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National Press Club -

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VOICE-OVER: Today at the

National Press Club, the

President of the Local

Government Association, Geoff

Lake. The third tier of

Government is convinced it's

never been more engaged with

the Commonwealth, is looking to recognition in the Constitution

to reflect that. Councillor

lake outlines his ambitions for

National Press Club local government in today's

National Press Club address.

(Bell rings)Ladies and

National Press Club and today's gentlemen, welcome to the

National Australia Bank

address. It's a great pleasure

to welcome for the first time

here today Councillor Geoff

Lake, President of the

Australian Council of Local

Government. When he rose to

the presidency about 16 months

ago at the age of 28, it represented a

change for the local government represented a real generational

movement, but in his home State

of Victoria, he'd already

achieved that by becoming

President of the Victorian Municipal Association of

Victoria at the age of 24. So

he comes to the job highly

experienced. He's a councillor

in the city of Monash in Melbourne

Melbourne and a city which has

achieved some notoriety in

various ways over the years,

but it doesn't rate today.

Local government overall has

come to occupy a much more

prominent place in Australian

democracy in recent times, and

that's despite an overall trend

towards greater centralisation. towards greater centralisation. 565 mayors, greatly reduced

over recent years, now have the

opportunity to meet the Prime

Australian Council of Local Minister annually at the

Government and Geoff Lake

himself is a full member of the

Governments along with the Council of Australian

Premiers and Chief Ministers,

and today, all the State

elements of the Australian

Council of Local Government are Council of Local Government are

represented here today. The

ACT, of course, which depending

on your point of view it has no

local government, or only local

government is a member of the

association, as well. One of

the objects of the association

and one which Geoff Lake has

been pursuing very actively is constitutional recognition for

local government and he's

already presided over a major

conference deciding how that

should be

should be done. He's called

his address today,

strengthening democracy in

Australia, the challenges and opportunities for local

government. Please welcome,

Geoff Lake. APPLAUSE

Well, thank you Ken and good

afternoon everybody. I'm very

pleased to be here this

afternoon. I'd like to begin

by acknowledging the traditional owners of the land by acknowledging the

on which we're meeting today

the Ngunnawal people and also

as Ken indicated in his

introduction, it's my

understanding that I think this

might be the first time that

somebody from local government

has addressed the National

Press Club and it's something

that we believe is probably a

little bit long overdue.

Today, I'm here to highlight the roles that

the roles that councils play in

government and more Australia's system of

importantly, the role that we

might play in the future. Now

pretty much everybody has a

view about local government.

Perhaps it's based on Bob Jelly

from 'Sea Change' or Col

Dunkley from 'Grassroots' or famous

famous councillors from that

infamous documentary 'Rats in

the Ranks' but it's more likely

that you've had direct dealings

with your local council

yourself and I hope your view

is more influenced by those dealings than those other

characters I just mentioned,

because it seems these days

local government is everywhere.

It has always been the roads,

the foot paths, the drains, the

street trees, the parks, the gardens and the local golf street trees, the parks, the

course, but in the past 50

years or so, local government

has popped up in many more

places than just those. It is

now typically also a provider

of early childhood services,

kindergardens, immunisations,

aged care, libraries, art

galleries, family counselling

and community health. It's

still the authority that

predominantly determines the

look, feel look, feel and development of our neighbourhoods and usually

it's at the heart of regional

economic development and

tourism strategies. If we were

to list all of the things done

by councils today, we'd come up

with a list of more than 150

services, although no two councils would be exactly

alike. Today in my address I

plan to do three things. I

want to give you a want to give you a better

appreciation of what local

government in Australia in 2010

is all about and how it has

evolved in recent times. I

want to give you an idea of our

key challenges and in

particular, our funding and constitutional limitations and

finally I want to make some comments about the importance

of community involvement in the

planning process. In the

course of discussing these

areas, I'll outline some areas

for reform that would improve

not only how local government

works, but also the broader

functioning of Australia's

system of government. Local

government has been represented

here at the national level

since 1947 when the Australian Council of Local Government, or

ALGA for short, was formed in

response to local government's

increasing relevance on

national issues. Today, it remains

remains the peak body for local

government nationally,

representing autoof the 565

councils across Australia. As

its president, as Ken indicated

in the introduction, I

represent local government on the Council of Australian

Governments COAG, and also on

13 other ministerial councils,

and this positions local

government right alongside key

Federal and State decisionmakers.

decisionmakers. Now it was

fitting that Australia's Prime

Minister back at the time of

ALGA's formation was Ben

Chiefly. Ben Chiefly is often

remembered as one of Australia's great prime ministers however what people

tend to overlook now, is as

well as being the train driver

who rose through the ranks to

become Prime Minister, he was

also a

also a great champion of

grassroots community action and

local involvement. Now it's

hardly remarkable that Chiefly

was a councillor before getting

into Parliament. Many of our

current members of Parliament

cut their teeth in local

politics too. Arthur Fadden,

and earl Gorton are other prime ministers who have served in

local government. However, the fact fact that Chiefly continued as

a counterproductive during his

time first as Treasurer and

then also as Prime Minister is

astonishing. You see, Ben Chiefly understood the

importance of the local. He

wanted to be just as involved

in decisions that affected his

locality where he lived in

Bathurst as the decisions that

he was involved in that

affected Australia's wider war

effort and its post-war

reconstruction. He found that

his capacity to shape issues as

Treasurer and then as Prime

Minister was enhanced by his

understanding of service

delivery at the local level.

Now, the idea of Kevin Rudd

dashing home to Brisbane to

attend his local council

meeting on a Tuesday night is

something that's quite probably

unimaginable to all of us. But

like Ben Chiefly, Kevin Rudd is

a strong believer in the

importance of local government.

In just two years in power, he

has done more to develop a

formal partnership between the

Commonwealth and local

government than any other.

Over the past year, he's given

councils an unprecedented $1

billion in extra funding for

community infrastructure. He

has established the Centre of Excellence for local government

and he has invested in local

government reform. In 2008, he

founded and Australian Council

of Local Government which is an

annual meeting of him and other

Cabinet ministers and also the

565 mayors from across the

country. Now these new

arrangements make a lot of

practical sense, given the national issues that are

currently on his agenda. List any of the Rudd Government's

key priorities at the moment,

whether it's climate change

through to the National

Broadband Network and it's

pretty much pointless beginning

a conversation about any of

these that doesn't include

local government. Local

government has a key role to

play in many national policy

issues today, and without our

engagement, effective reform or

roll-out in any of these areas

is going to be very difficult

to achieve. In a country like

Australia with our three levels

of Government, vast geographic

areas and centralised taxation

system, it's essential that all

governments are able to work

together effectively. Indeed,

there are very few policy

issues facing Australia which

can be solved solely at one

level of government. Under the

Rudd Government, we have seen

COAG go from an annual talkfest

to a sharper, more

reform-focussed body which now

meets four times a year. You

can call this co-operative

federalism or you can call it

something else, I'll just call

that a good thing. Of course,

the COAG process, though, is

not perfect and developing it

into a more robust and

effective forum must remain a

priority. But co-operative

federalism requires more than

governments merely meeting

together, and one of the main

stumbling blocks is Australia's

constitution. Despite local

government having existed in

Australia since the 1840s, it

is not mentioned anywhere at

all in the nation's

constitution. Now that's a

problem I'll explain shortly,

but before I get to that, I

just want to get straight what

this is not all about. Despite

the way that some people refer

to it, and Ken referred to it

this way in his introduction,

this is not about mere

recognition for local

government in the constitution.

To seek constitutional change

simply in order to see the

words " local government"

somewhere in the constitution

is little more than an

indulgent frolic and one, I

think, invites an impression of

local government being a bit

too self-absorbed, or to put it

another way, a little like the

small man syndrome. It is a

cause in which I have little

interest, but let me explain

the problem which does exist

and which does need to be

addressed. You may recall from

last year academic Brian Pape

challenged and constitutional basis of the Federal

Government's $900 payments to

taxpayers as part of the

stimulus package. Now although

the High Court ultimately

upheld the validity of these

payments, in doing so their

reasoning has created

significant uncertainty for

direct funding provided by the

Commonwealth to third parties

in other areas where it can't

be tied to a specific head of

power under the constitution,

such as those powers listed

under Section 51. The High

Court's reasoning suggests that

the money paid by the

Commonwealth directly to local

government is unconstitutional.

That is also the view of

Professor George Williams who

is one of Australia's leading

constitutional scholars and

lawyers and who has provided

legal advice on this matter to

local government. That's why

when Federal funding to

councils was commenced back in

the 1970s by the Whitlam

Government, the funds were challenged into local

government through the States

to overcome this limitation.

Plainly, this is an inefficient

way to transfer funding. Since

2001, though, there's been a

preference by the Commonwealth

to specific program funding

which involves payments

directly to councils. This now

amounts to hundreds of millions

of dollars which councils

receive each year directly from

the Commonwealth for programs

such as investment into local

roads. We see this development

as a good thing and one which

makes logical sense as we see

little point in State

Government being the middle

man. But Pape now stands for

authority for the proposition

that the Commonwealth lacks the

constitutional power to provide

funds directly to councils.

And let's just stop for a

second and think about that.

The High Court's decision

suggests that by continuing to fund local government directly,

the Commonwealth is breaking

the law. This is a real issue

and it deserves attention, and

it's ridiculous that in 2010,

after more than 30 years of Commonwealth funding to local

government, that not only is

there still a need to maintain

this extra bureaucracy to get

money to local government via

the States, but the move to

direct funding over the past

decade may also need to be

rolled back. The constitution

is meant to enable Government

at the national level but in

this instance it fetters it.

It's hardly controversial to

suggest this money ought to

flow seamlessly. The current

position frankly, makes no

sense at all and it's an

example of where the Australian

system of government is

outdated and needs reform.

Local government believes that

a referendum should be held

during the next parliamentary

term to consider whether a new

financial power should be

inserted in the constitution to

expressly enable the

Commonwealth to fund councils

directly. We see this as a bit

of a no-brainer and fitting

into a broader package of constitutional reform that's

consistent with the sort of

changes that both sides of

politics have recently been

talking about. It's as easy as

amending Section 96. That's

the section which sets out that

the Commonwealth may grant

financial assistance to the

States in such terms and conditions as it thinks fit,

and all we need to do is simply

add the words " and local

government". When it comes

zoltion change, we understand

that the starting position for

Australian voters and their

politicians is, if it ain't

broke, don't fix it. However

this is an example of where it

is broke and where it does need

fixing. The current arrangements are nothing indeed

than a house of cards. The

consequences of a legal

challenge for local government

would be disastrous, not only

would a successful challenge

invalidate current and future

direct funding, but it would

also render all past payments

to councils illegal and require

that money to be paid back to

the Commonwealth. It would

bankrupt every single council

across the country. It's

absurd that one level of

Government, the Federal one

which collects the most

taxation in this country, can't

give it directly to the level

of government which collects

the least without breaking the

law. The Rudd Government

supports a change to the

constitution to clean this up.

So do The Greens and the

Opposition has so far indicated

its principle support too, and

this is all with good reason.

Given that the past 50 years

has seen an explosion in the

size, scope and role of local

government. Whereas once all

councils did pretty much was

build and manage physical-local

infrastructure such as building

roads and collecting rubbish,

today as I've already said,

local government is typically

delivering more than 150

services across a huge spectrum

of people services. However,

when we talk about local

government today, we're talking

about a range of very diverse

sizes. Councils like the city of Brisbane with more than a

population of a million people

and a budget which rivals that

of the State of Tasmania.

While on the other hand,

councils like west Pilbara in

WA, which is the land size of

Japan, but a population of not

many more than the number of

people in this room today. But

regardless of size, councils

are there quietly working away

around the corner at the local

park, the local swimming pool,

the regional art gallery. If

you or someone you know has a

AWB, it's typically the council

which provides the first form

of government support in that

new baby's life, whether it be

through maternal and child

health services, through to

kindergarden and preschool.

For our elderly parents and

grandparents, councils provide

the sort of care and assistance

that enables them to remain in

the home for longer. Hundreds

of thousands of books are

borrowed every week from public

libraries which are run by

local councils. This

grassroots entrenchment is our

point of difference from State

and Federal Government, neither

of which have anything like our

embedded presence in just about

every community across

Australia. Now I'm not

suggesting for a second that we

do it all perfectly, because we

certainly don't, but local

government has always been there in Australia, right in

the thick of it, of where

people live and we always will

be and most importantly, local

government offers tailored

services and amenities to what

communities want. However,

while there's been this expo

innocential increase in growth

in local government's roles and

responsibilities there's been

no change to the way we fund

local government. Councils are

still predominantly funded by a

property tax, rates, collected

in the same way as it was 100

years ago. There's a

compelling case that the way

that we fund local government

today is antiquated and in need

of reform and rejuvenation.

While it's still the rate payer

who picks up the tab, the

correlation between the people

services that councils now increasingly provide and

property is rapidly

diminishing. Simply, the tax

base has not kept base with the evolution of the local

government system itself. As

services have been switched and transformed from the State to the local level, State

governments have got the

benefit of getting these costs

off their books, but local

government has had to rely on

its very narrow property base

as its only form of taxation in

order to meet these new costs

and that's not fair, given that

these new people services have

little to do with property, it

would be much more equitable to

meet these costs by a transfer

of general tax revenue such as

income and consumption tax

that's collected by other

levels of government and that being transferred to the local

level. But not only is local

government improperly funded

it's also inadequately funded.

At present, local government

only recieves about 15% of its

total revenue from general

taxation transferred from the

other levels of government and that's predominantly from the Commonwealth. Local government

is a $25 billion industry and

it employs more than 170,000

people. Communities have a

right to expect a more solid

funding base for local

government. In our view, this

is something that the Henry tax

review should be considering.

Not just how tax revenues are

collected but also how they are

shared between the three levels

of government for the benefit

of all Australians. Given the

substantial growth in service

delivery over the past 50

years, local government is

stretched to breaking point in

meeting these demands while maintaining local

infrastructure. A 2003

parliamentary inquiry

demonstrated that the impact of

cost shifting by the States

onto local government was

between $500 million and $1.1

billion per year. That came as

no surprise to people involved in local government. Of

course, ultimately all levels

of government serve the same

common stakeholder who doesn't really care who delivers a

service as long as that service

is delivered in the most

efficient and effective manner.

However this lack of adequate

funding for local government is significantly affecting the

sector's ability to meet the

needs of local communities and

the demands of State and

Federal government. A recent

report by price Waterhouse

Coopers which was commissioned

by local government, concluded

as a result of this substantial

growth in services delivered at

the local level, the estimated

infrastructure funding backlog

across councils was $14.5

billion, which amounts to a

funding gap each year somewhere

in the order of about $2

billion. The report also

concluded that somewhere in the

vicinity of 10-30% of all

councils currently are

unsustainable. Now the $1 billion from the Rudd Government for community

infrastructure as part of the

stimulus package was a great

start. However, it's only a

first step and more funding is

desperately needed if local

government is going to be able

to meet its broader range of

services which are expected of

the modern council. Now it

wouldn't be a speech about

local government if I didn't

have something to say on the

topic of planning. Planning is

complex, it's controversial and

it's political and it's hard to

talk about at the national

level because it differs in

every State and indeed also it

differs within States, however

what doesn't change is the

fundamental importance of

community involvement in

planning. In recent times,

though, all over the country we

have seen State governments

undermining the community's

right to be consulted and have

a say in planning. To the

development industry and State

Government planning officials

who believe planning can be

done by the application of a

simple check list, or a

Statewide set of principles, I

say you're in la-la land.

Planning is not a science which

can be determined in a

laboratory simply by mixing a

few elixirs together. It's

adversarial and it's hard work.

I want to make something very

clear here today. Local government won't roll over on

so-called planning reform and

let clumsy State governments

continue their trend of stripping out community

involvement from the planning

process. In the past few

months, we have even begun to

see governments talking about

planning process reform as the

solution for affordable

housing. This is utter

nonsense. It may suit

governments to talk about

action on affordable housing

through reform of planning

processes as the Treasurers did

in their meeting last week, but

this is the biggest fraud going around in Australian politics

today and they should be called

to account on it. You can

create the most efficient

planning system in the world

and it won't have any

significant impact at all on

affordable housing. Affordable

housing is far more influenced

by macroeconomic policies on

the demand side of the

equation. Things like tax

concessions, monetary policy

settings and also the lending

practices of the banks. A bit

of talk about planning process

reform and engaging in a bit of

old-fashioned council bashing

doesn't equal tough action on

affordable housing. The

problem when other levels of

government talk about planning

reform is that they almost

always start from a position

that community involvement in

planning decisions is bad, that

local variance in planning is

bad and that both ought to be

curtailed. Even Ken Henry has

jumped on board recently when

he dismissed local planning

policies as a maze of

regulations and as

idiosyncratic. Planning reform

ought to be directed at process

and efficiency improvements,

not recasting the whole

democratic process on which

planning sits. We say to State and Federal Government, do it

with us, not to us. Incentivise it, subject

councils to data and accountability, reward good

performance - we're open to all

of that. But don't simply look

to the low-hanging fruit of

hastily and ill-conceived

planning reforms. We certainly

don't seek community control of

planning and we do not suggest

that neighbourhood objections

should always prevail, but it

is a fundamental right to have

a say in how one's community

develops and if State and

Federal Governments don't heed

this message they might have to

hear it at the ballot box.

Perhaps through a campaign such

as Your Rights at Home run by

local government at the next

election. Does it sound

familiar? Similar issues are at

stake. In defending community

and council involvement in

the message that local planning, I don't want to send

government sees little room for

change or improvement in our

processes, or in our affairs

more generally. We do, and

that's why we've agreed to

suspend some of our planning

processes as part of the

ongoing roll-out of projects

funded under the stimulus

package. Moreover and increasingly, local government

is directing more of our

Statewide and nationwide

resources towards streamlining

and modernising planning

processes. I'm a strong

believer in the community

having a right to be able to

access information on the

performance of their public institutions and local

government should be no

different. I support the

concept of developing a My Council-style website so

residents and ratepayers are

able to compare how their

council is performing compared

to other like councils. Data

is so important and targeting

where reform is most needed.

Getting data collection uniform

and meaningful across key local

government indicators makes

sense and ought to be a

priority and using it to

highlight the most innovate ive

approaches and to target where

improvement is needed is in

everybody's interests. This is

something that I want to see

local government drive as a

sector on a bottom-up basis

rather than waiting for other

levels of government to impose

it on us from above. Now let

me finish by returning to where

I started with Ben Chiefly. In

1947, in the midst of trying to

convince the nation of the need

to nationalise the banks, Ben

Chiefly faced a local

government election. He faced

government election. He faced

a Country Party candidate who

campaigned against him on the

basis he was too busy taking on

the bankers on Colins Street

and he'd lost touch with local

issues in his community. It

was a message that resonated

with voters and Chiefly was

defeated. It must have been a humiliating experience for a

Prime Minister. We now talk

about John Howard as being the

second Prime Minister, the

second incumbent Prime Minister

to be rejected by his local

constituency, but this isn't

correct at all. Chiefly is, in

fact, the second Prime

Minister, although it wasn't

his parliamentary seat which he

lost. Local government

mattered to Ben Chiefly,

because Ben Chiefly appreciated

its importance and the

grounding and perspective it

gave him on national levels.

However, and in my mind the

best part about the Ben Chiefly

story was that in the end even

a Prime Minister is not immune

from local issues and local

democracy in action. It is one

of the great things about local

government which still exists

today - direct accountability.

By 1947, Chiefly had personally

achieved a blending of the

local and the national that was

well ahead of his time. In

different ways what Chiefly

pioneered personally has been

built upon by successive

particular those governments governments in recent times, in

led by Whitlam, Hawke, Howard

and now Rudd to a point where

local government now has a

valuable contribution to make

on many important contemporary

national issues. But the

world's changed a lot in that

time and if local government is

to continue to meet the needs of local communities both today

and into the future, we must

fix the constitutional

impediments holding local

government back. We must fix

the funding base and we must

protect the right of

communities and councils to

participate in the planning

process. Not only is all of

this in Australia's national

interest, but much more

importantly than that, it's all

in all of our personal

interests, as well. Thanks very much. APPLAUSE

Thank you very much. We have

our usual period of questions

today. Councillor, Matthew Franklin from the 'Australian'.

I'm interested in the issue of

planning that you raised and

what you describe as the

attempts by the State to deny

local consultation and to sort

of sideline councils. Last

week, I asked Wayne Swan about

this issue and yesterday I

asked Tanya Plibersek about

this issue and said "What is

your response to the Local

Government Association's

criticism?" They said "That's

a matter for the States". Now

given that it was as you said

in your speech relaxation of

planning requirements linked to

the Rudd stimulus program, how

do you feel about the fact that

they seem to be wiping their

hands of what you describe as a

significant problem? Well, I

think they're being a little

bit dishonest by saying this is

nothing to do with the Federal

Government. The Federal

Government is driving to some

extent planning reform through

the COAG process. It's on the

agenda there. It's been

discussed at COAG. It was discussed last week at the

Treasurer's meeting and it's

been discussed at multiple

meetings of Housing Ministers,

Local Government Ministers and

Planning Ministers. I sit on

all of those forums except the

Treasurer's meeting, but

they're right to say that this

is an issue for State governments. It's State governments ultimately that

determine the planning process s that exist within their

particular jurisdictions. So

ultimately our beef I guess is with State governments. We want to see State governments

understanding that the

bureaucrats that they have sitting in their State

Departments are simply not up

to the task of taking over planning from local government.

The talent - I'm a bit

parochial about this, but it's

true - the talent in planning

on the Government side of

things exists in councils not

in State governments, and if

we've learnt nothing else from

the last 12 months as we've

seen an increased number of

projects taken over by State

Government planning

departments, we have seen

processes lengthen, we have

seen sloppy decisions, we have

seen communities ridden

roughshod over in the clamour

to get developments improved

and out the door. Local

government does it better. The

community understands that, and

local government will fight to

assert that right at COAG with

the Federal Government, but

most particularly with State

governments. You mentioned in

your address that councils

wanted more money from the

Commonwealth, effectively from

the tax base and yet you're

saying that you don't want

Commonwealth intervention in

areas of planning. How do you

reconcile those two things? On

the one hand saying you want

the money on the other hand

saying you don't want anything

imposed on you from the Commonwealth? Well, we support

Commonwealth interest and

development in cities and

planning, but we don't want

them to come down to the mi kro

and start telling us how a planning application on the

ground should be assessed. I

think that the formula that the

Prime Minister is articulating

on health is relevant and

applicable to our interests in

planning and the other things

that are inherently things of a

community interest and a local government concern. He talks

about in health, Federal

funding but local control. We

say to him "We will sign up to

targets, we will sign up to

reforms, but we don't want to

have these reforms

prescriptively delivered to us

from above and particularly

where those reforms equate to stripping out community

involvement from planning" as

many of the reforms that are

currently being discussed

through the COAG process do.

We don't want that kind ofm

icro managing and we continue

to put those arguments in COAG

and as I said, if we don't get

the traction through those

intergovernmental forums we

will look to other options,

such as introducing hopefully

the view of the community and

encouraging them to express

their view in the context of

either an election or in

general through public comment. How would you describe

your reception at COAG? Well,

I've been to I think five COAG

meetings now since I became

president, and... well, let's

be honest, a lot of the

discussions at COAG are not

always, it doesn't always have

local government right in the

centre of them. They tend to

be discussions between the

Federal Government and the

States. But I found at each of

those COAG meetings there's

been at least a couple of areas

where there is a very clear

level of interest and

contribution for local

government to make and I've

tried to make that contribution

and I've got to say, the Prime

Minister and the premiers and

the Chief Ministers are very

receptive, very welcoming of

me. We had dinner the night

before COAG meetings. I'm

included in that. The Prime

Minister sends one of those big

the airport, which I don't white cars to pick me up from

think my predecessor got, so

I'm very grateful for that. So

I'm treated as a fair dinkum

member of the team, but I understand that local

government has its place. We have a contribution to make on

some issues, but not every

issue. Pleased to hear it.

issue. Pleased to hear it. 17

minutes into your speech you

talked about how you wanted the

reform of the way consumption

taxes are handed out to

different layers of Government.

We have the Commonwealth Grants

Commission and the States are

bickering to get their share of

the GST carve-up. Are you

saying now that local

government should now be

included in the Commonwealth

Grants Commission with the GST

carve-up and how do you

governments are going to anticipate that the local

compete with the States to get

their biggest share of the GST

funding when there's already

enough argy-bargy as it is

right now? I didn't say that

local government seeks a share

of GST, but I did say that money raised through income tax

or the GST is a more suitable

way of paying for people

services than property

taxation, which is essentially

how local government has to pay

for people services at the

moment. So we're calling for

reform of how the tax dollar is

distributed across government. The Federal Government collects

most tax in this country.

State Government, I think,'s

dependent on about 50% of its revenue coming from the Federal Government. Local government

is far more self-sufficient I

guess than State Government.

We collect more of our own

revenue than the States do. We

will leave to the States and to

the Commonwealth the detail

around how local government

could be better funded. We

ultimately don't mind, but what

we are saying very clearly is

that general taxation revenue,

be it consumption tax or income

tax or any of those other

sources, company tax, those are

the source s that ought to be

paying for people services and

that is the money that

communities across the country

desperately require so they can

access the sort of services

that they've got a right to

have delivered at the local

level. You said that the

talent in planning, in answer

to your first question, resides

or exists in local government

not in State Government. I

think implicit in your speech

was the suggestion that there's

a lot of talent that resides

there too in terms of services,

delivery of services. I'm sure

that a lot of their members,

perhaps all of them, look on at

amazement as the horror after

horror emerges over the

insulation program, the

delivery of that, the schools

building program. If local

government had been more

actively engaged, more

involved, if you're involved at

all, in fact, in the delivery

of those programs, do you think

that we might have avoided some

of those problems? It's hard to

comment directly on what's

happened with the housing

insulation scheme, but one

thing I can say with some

confidence is that local

government's core business, in

fact everything that we do is

about service delivery and it's

about implement ation on the ground so, the competitive advantage of local government

government is that we have the over the other two levels of

ability to roll things out in a

way that Canberra will never

have in local communities, and

also in a way that State

governments perhaps to a

greater extent than Canberra,

but certainly compared to us

also don't have through every

nook and cranny of every

community across the country.

We certainly, I think, have a contribution to play when it

comes to the roll-out of

difficult new areas of service

delivery. But I come back to

the whole central point of the

thesis I've tried to express

today. Local government is

chronically underfunded, it's

underresourced. It's a logical

service delivery vehicle for the Australian system of

government, but it can't fulfil

those sorts of roles on current

policy settings. It needs

reform , it needs rejuvenation

and with that rejuvenation

there is significant

possibility for better service

delivery in Australia. This

question's about funding as

well. A lot of councils lost a

lot of money during the GFC.

You're talking about sources of

funding for local councils but

through some bad investments,

particularly in organisations

like Lehman Brothers, they lost that money. Now yesterday they

won the High Court right to sue

Lehman Brothers overseas. I

was interested in your response

to that, but plus also how

councils can reduce the risk of

being exposed to such losses in

the future. What sort of steps

have been taken? Well, I guess

the steps they could take is

stick to triple A invest-rated

products which I understand the Lehman Brothers was at the

time. This is a difficult

area. I believe public

institutions managing public

money need to be very careful

and probably conservative in

how they invest public funds

and certainly, there's an

obligation on local government

where it has lost money through

investments that have failed to

pursue every possible legal

avenue to try and claw some of

that money back, and the great

thing as I understand it by the High Court's determination yesterday, is that there are

some avenues open to the very

small number of councils that

have been hit hard by

investments during the global

financial crisis and they

should be congratulated for

asserting the rights of their

ratepayers to try and claw that money back. But I think the

message out of all this,

there's issues around rating

agencies. A triple A rated

product should not fail. There

need to be answers there. This

is not to do with public

administration, this is to do with rating agencies and I

suspect it will be a long time

into the future before we see

another sort of mammoth failure

in such highly-rated investment products as a result of the

experience of the last couple

of years going forward. That's

a good thing. Another

question, since you raised the

economic stimulus issues

before, or there was a question

about it before, I had a visit

some time last year from an

association of councils from

South East Queensland and they

were noting that Kevin Rudd was

saying, " We need our economic

stimulus to be rolled out

quickly, we need shovel-ready

projects" , these guys said

"We've got lots and lots of

shovel-ready projects, why

don't you just fund them

instead of schools or at least

give Australia chunk of the

money?" Was that a phenomenon

that you observed is a national

phenomenon and that is if the

Government had chosen of, it

could have put stimulus money,

instead of being in schools or

insulation it could have been

in infrastructure. The

Commonwealth put $1 billion

into councils and if you were

to look at all of the

components trnd stimulus

package, the $1 billion spent

by local government probably

stands out as the component

that has worked the best.

Compare it to schools, social

housing, compare it to the

ill-feted housing insulation

scheme, it's been a very

different story with local

government. Almost every

council across the country has

met delivery timelines, has met

deadlines and the best part of

it all is that local councils

have had complete control over

the sorts of project s that

they've been funding and

delivering in their local

community. This hasn't been a

faceless bureaucrat in

Canberra, no offence to our

friends in the local government

department who have determined

which projects ought to be implemented at the local level.

Councils have come up with

those, they've been funded

through Federal money and it's

a great model for how further investment into community

infrastructure should go in the

future. So if Kevin Rudd wants

to get some more money out the

door, or perhaps some of those

areas that haven't been able to

spend their money to time, he's

only got to pick up the phone to local government and we'll

help him out. Just on a

slightly different topic,

there's a growth summit happening in Brisbane today being run by the State

Government and among other

things, they're discussing how

the city is going to deal with

a population of four million, which is double Brisbane's current population. Kevin

Rudd's come out and said he

supports a big Australia, so

I'm interested to know that seeing as local government is the area that's going to feel

the strain of this, but also in

some respects perhaps the

infrastructure charges and benefit from things like

rates, do you support a big Australia and what do you think

we need to do to plan for

it? First of all, I

congratulate Premier Bligh by

taking up the initiative that local government has been

championing for some time in

Queensland. The Queensland

Local Government Association,

the city of Brisbane and the

South East Queensland group, other councils that make up the

they've been talking about the

need for a population plan in

that part of the world for more

than five years now and it's

great that the State Government

has finally come on board and

they're giving it the attention

that it deserves. As far as my

own view, I think population

growth is great for the

economic vitality and the

social vitality of communities.

It's obvious I think in the

cities. You only have to walk

around the streets of

Melbourne. It's a very

different place to what it was

20 or so years ago. I can just

remember that far back. But

more so, walk around the

streets of Mildura or

Shepparton, where large numbers

of Afghani refugees have

settled in those communities

and what it's done to those

communities has been quite

magnificent. The communities

are united, it functions well

and it's also been a real boost

to regional location s that can

do with a bit of extra

population growth. So my

personal view is population

growth is not something to be

too worried about it. It needs

to be properly managed and I

think the example being set by

the councils in the south-east

corner of Queensland is a

terrific example of where -

forget amalgamation, encourage

local government to get

together on a regional basis to

begin the dialogue as has

happened in that area through

the leadership of Campbell

Newman and that shows you what

regional-based approach rather is capable in a more

than going down that murky road

of council amalgamations. You

were talking earlier in your

speech about what could happen,

you were saying councils under the constitution aren't

recognised and if some other

absecure academic goes to the

High Court and challenges

council funding they'll all go

bankrupt, it'd be Armageddon.

I was really worried when I

heard all that. Then you

called for a thing called a

referendum N Australia, very

few referendums get the supports of most States in

Australia. We had the 1967 one on recognising Indigenous

people, the 1946 referendum on

giving Canberra the power for

Federal income tax. So that's

the challenge, how are you

going to run a referendum

campaign to get the majority of

States to support the idea of

making councils constitutional,

considering that most people

think that that may lead to

higher rates and people are

already adverse to higher

taxes. You have big odds

against you already, how would

you counter those? In the

interests of full disclosure,

I'd better let you know that a

question dealing with local government has been tried

before. In fact, on two

occasions, 1974 and 1988 and

spectacular failure on both

occasions. So we start with

the challenge ahead of us,

however I think the thing

that's different this time is

that it simply makes sense.

You said the concern might be

in communities that constitutional change of the

sort that we see, of the kind

that we seek could lead to

higher rates. In fact it's the

exact opposite is true. If we

don't have constitutional

change and we have an academic

who comes in and challenges the

current arrangement if you can

cobble legal standing together

to do so, then we have a situation where local

government can't deliver the

same service s that it

delivered last year to their

communities and the impact is

either you strip those services

out or more likely - 'cause

these aren't just discretionary

services, these are essential

services provided to local

communities - it's the poor old

rate payer that has their rate

bill loaded up quite

significantly to cover that

shortfall. When we talk about

constitutional change, we're

not talking about anything

earth shattering, we're not

tinkers with State sovereignty.

State Government also still be

able to come in and sack

councils if they wish, abolish

councils, change local

government, but what will

happen is there will be a

straightforward means for the

Federal Government to do what

it has been doing for the last

35-odd years and that is pass

funds from its level to local government. I don't think that's particularly

complicated, I don't think it's

controversial. Yes it will be

hard to get it up at

referendum, because referendums

always are, but I think local

government with its presence in

every single community across

the country is in a pretty good

position to give it a red-hot

go. Let's leave the media

questions for a moment and

here's one from Lachlan

McIntosh. ALGA is a partner

of ours, it's a reclaiming and

recycling organisation for rural chemicals and the

containers. We actually pick

up about two million drums a

year and pick up some councils

which local government is left

with doing, and I think it's in

the area where the heavy

lifting is and as you say,

rubbish is no longer rubbish,

it's now recycling. It's now a

new product and while it can be

dealt with locally, it has to

be processed nationally. It

has to be removed nationally

and so councils while left with

I guess the business at the

farm end and the farmers and

the chemical companies are

paying and contributing to

this, so they're part of the

thing, the community in general

benefits from the clean-up.

How do you translate... I mean

you talk about broadening the services into regional and then

into State, it seems to me that

the three levels of Government

make it very difficult for

local government to actually

recycle the product. E-waste

for instance, thousands of

televisions out there as well

as drums, but there needs to be a national approach to saying,

" We're going to fund this

nationally to make it happen".

You're left with the hard work,

but you also need to talk to a

bigger audience about what has

to be done. The game has

changed. Rubbish just doesn't

get left in the pit anymore.

You've got to open that door,

how can you open the door to

doing more nationally as well

as picking up stuff locally? I

think we've got a great

opportunity with our

involvement in intergovernmental decision

making forums, the ministerial

councils. That is the classic

issue that those forums are set

up to achieve and we're on the

Environment Ministerial council

and those are the sort of

issues that are being discussed

at the moment and it's a

logical issue for local

government not just to

participate in the debate but

actually lead the debate and

lead the agenda, because I

think you're right, government

in this country can't exist

over the next 50 years in the

same way that it's just always

existed. There are massive efficiencies out there to be

found and the way to find those

efficiencies is not through

governments acting with a ring

fence around themselves and in

isolation from what other

levels of government are doing, but it's through collaboration,

it's through working together

and it's through being prepared

to look at things through from

a fresh perspective and not necessarily argue or maintain

that something must be done a

certain way, 'cause it's always

been done that way, or perhaps

it may, you know, be done

better by a different level.

They're the sort of challenges

and the sort of debate s that

modern local government in 2010

in. is fairly keen to play a part

in. A final question. I'm

with the Australian Automobile Association today. Congratulations on the success

that local governments had in

the funding and interaction

with the Rudd Government over

the past few years. I'm

curious in this election year

what you think will be the

priorities in your election

campaigning over and above Your

Rights at Home and I'm

wondering whether or not road

safety and safer roads are an

important part of your election

strategy. There's no bigger

issue for local government on

the expenditure side than local

roads. Typically roads account

for about 30% of local

government spending at a

national level For a rural

council it's more than 50% of

their individual budget and I

find people don't know this,

but councils actually manage,

run and build 80% of the entire

road length across the country.

Like I think we think of State

and Federal Government of being

in charge of the roads.

They're only in charge of a

very small bit and probably the

cheaper bit. We face huge

problems maintaining local

roads. We're looking to the

Henry tax review for some

outcomes in that area, and

we're also asking the State and

Federal Governments for

increased assistance. Climate

change we're active in. We

need more assistance at the

local level, targeted or built

up from a Federal level but

targeted locally for helping

communities deal with things

like sea level rise and also

natural disaster mitigation in

rural areas and also, of

course, there's the issues I've

talked about, which are more

funding for local government,

commitments to pursue a

referendum at some stage during

the next parliamentary term and

also as you mentioned and

alluded to, a commitment around

community involvement in

planning. Thank you very

APPLAUSE much. Thanks.

Geoff Lake, thank you very

much for joining us for this

past hour. It might have been

a bit late in having a formal local government representative

talk to us, so here's a

membership card, you can come

back again and tell us how it's going fairly shortly. Thank you again. Thank you. Closed Captions by CSI