Council
12 July, 2024
Council funding a concern for C’mite
CORANGAMITE Shire Council has voted to enter a submission into the inquiry into Local Government Funding and Services at last month’s Ordinary Meeting of Council.
Council made the submission following recent correspondence from State Legislative Council – Economy and Infrastructure Committee chair Georgie Purcell, who outlined the terms of reference for the inquiry.
The inquiry will examine the financial sustainability and funding frameworks of local councils, as well as council service delivery and the effects of government cost shifting.
Specifically, the inquiry will investigate:
The effects of cost shifting from the state and federal governments to local councils in an examination of vertical and horizontal fiscal imbalances;
Whether local councils are adequately delivering on their core service delivery objectives;
The overall revenue structure of local government; and
Whether the existing revenue structure is sustainable and appropriate, or if alternative models of funding would be more sustainable and appropriate.
Councillor Ruth Gstrein voted in favor of the motion, mentioning an unconfirmed hearing to be held in Camperdown sometime in August this year.
“I think this is a great opportunity for council moving forward,” she said.
“There is a lot of concerns, and we’ve talked a lot about annual action plans and budgets and the service delivery of councils.
“We do have limited opportunities for raising funds, and that’s why there is so much taken in rates.
“Forty-six per cent of income is in rates. I think our dependence on grants is getting slimmer and slimmer and we don’t have any other real ways of raising revenue other than fees and charges.”
Corangamite Shire Council’s submission will look at the differences in income streams between metropolitan councils, who have access to parking revenue, and rural and regional councils.
Cr Gstrein said cost shifting was a major concern for council.
“We’ve done a piece of work several years ago on the impacts of cost shifting in Corangamite Shire and it comes down to things like library funding; it used to be 75 per cent state government and 25 per cent local – it’s completely flipped the other way,” she said.
“School crossing supervisors are the same, where they’ve been heavily subsidised in the past, and they’ve just gradually pulled services back.
“They’re just a couple of examples but, at the end of the day, there’s services that are much-loved by the communities and when you put them in place they’re very hard to scale back.”
Cr Gstrein referred to a report conducted in 2015, which broke down a tax dollar into the distribution in cents to each of the three levels of government.
She said, of every tax dollar, the federal government gets 81 cents, the state government receives 16 cents, and local councils receive the remaining three cents.
“It’s about those decisions that we have to grapple with every year when we’re doing our budget; we do an awful lot with that three cents,” Cr Gstrein said.
Cr Laurie Hickey said the terms of reference for the inquiry were crucial for council to discuss.
“The four areas are very pertinent to our business and the way the Corangamite Shire go about their business, in particular the cost shifting from the other levels of governments and also the inquiry into the revenue structures of local council,” he said.
“I’d love to be at the Camperdown
sitting when we’re able to go through those.
“Unfortunately, it’ll be an apology, but it’d be very interesting to sit and work through that as well.”
Cr Nick Cole said the inquiry was a “good thing” to “try and sort out” the funding disparity.
“With a lot of these things, the government make the big announcement, get the photographic opportunity and then we are left holding the bathwater basically,” he said.
“They built the bath – we have to keep filling it and those costs are getting more and more, especially when you consider that a lot of the regulations and red tape are coming from state government driving up a lot of the costs as well.
“I reckon we’re doing a better job.”