While the 2018-19 Federal Budget includes a significant investment in large-scale infrastructure projects, the future of the local roads South Australians use every day remains uncertain.
LGA President Lorraine Rosenberg said it was disappointing that supplementary local road funding for SA was not confirmed beyond the coming financial year.
“South Australia has 11% of Australia’s identified local roads, and 7% of its population, but only receives 5.5% of federal local roads funding,” Mayor Rosenberg said.
“Last year’s Budget included a two-year $40 million commitment to supplementary road funding that addressed the unfair share of federal funding SA councils receive.”
“However, this additional funding will expire after 2018-19, leaving SA councils with a $20 million question mark hanging over their future roads budgets.”
“A key focus for the LGA this year will be advocating to all South Australian federal MPs to support the continuation of supplementary road funding for SA in 2019-20 and beyond.”
“A commitment from the Commonwealth to make this funding permanent would enable our councils to better plan for strategic road upgrades, and put them on a level playing field with councils interstate.”
Commonweath funding is a critical part of local government’s revenue mix, and any shortfall received by SA councils often needs to be supplemented with additional rates. It is a priority for councils nationally to ensure that the value of Commonwealth Financial Assistance Grants (FAGs) are set at an adequate level.
South Australian councils have been allocated around $160 million in FAGs in the 2018-19 Federal Budget – an increase of $4 million on 2017-18. This funding is untied, meaning it can be used by councils to address local priorities.
Mayor Rosenberg said despite the recent return of annual FAGs indexation, more needed to be done to grow the total value of these grants.
“Over the past two decades the relative value of FAGs has decreased significantly – from 1% of national taxation in 1996 to 0.55% today,” Mayor Rosenberg said.
“Local government collects just 4% of Australia’s taxes, and over time the total value of FAGs grants should be increased to its previous level to ensure councils are adequately resourced to provide the services and facilities their communities need.”
The LGA will undertake a detailed review of the 2018-19 Federal Budget to identify opportunities for South Australian councils to bring investment to their local communities.