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LGA welcomes return of FAGs indexation and supplementary road funding for SA

9 May 2017

Councils and communities will benefit from millions in additional funding with the return of Financial Assistance Grants (FAGs) indexation and supplementary road funding for South Australia, announced in the 2017/18 Federal Budget.

LGA Executive Director Public Affairs Lisa Teburea said the FAGs indexation freeze – which has been in place since 2014/15 – has cost SA councils $36 million over the past three years, and wiped 13% off the total value of the fund.

“These grants are particularly valuable as they are un-tied, meaning councils can use this funding to provide the facilities and services most needed by their ratepayers,” Ms Teburea said.

“The Government’s decision to freeze indexation on FAGs in its 2014/15 budget has had a significant impact on South Australian councils, with regional communities – where the grants make up a higher proportion of councils’ total revenue – the hardest hit.”

“The LGA has worked with the Australian Local Government Association (ALGA) to advocate for the re-instatement of FAGs indexation, and we are thrilled our advocacy has helped contribute to this positive outcome.”

In 2017/18 South Australian councils will receive a total of $156 million in Financial Assistance Grants.

Ms Teburea said the announcement of $40 million over two years in supplementary road funding – to assist South Australian councils to maintain and upgrade the State’s road network – was another significant win for South Australian communities.

“South Australian councils manage 11 percent (75,000km) of the nation’s local road network, have over 7 percent of the nation’s population, and yet receive only 5.5 percent of Identified Local Roads Grant funding,” Ms Teburea said.

“This was rectified in 2004/05, through an annual ‘top-up” supplementary payment of around $18 million per annum to South Australia.  However, this payment was removed in 2014/15.”

“Over the past three years we’ve continued to advocate for the return of this payment, and we appreciate the Federal Government restoring fair and equitable road funding to South Australian councils in this year’s Budget.”  

“We also acknowledge and value the support of ALGA in identifying the return of this funding as a priority in their 2017/18 Federal Budget submission.”

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