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Tuesday, 25 November 2003
Page: 22831


Ms BURKE (6:12 PM) —I rise today to also welcome the Standing Committee on Economics, Finance and Public Administration report into cost shifting onto local government and to further the remarks I made in the House. At the outset I want to read into Hansard what is I think a rather remarkable thing that the chair of the committee, David Hawker, the member for Wannon, and I have just witnessed at the 2003 National General Assembly of Local Government. It is the 10th anniversary of the assembly. The chair of the committee made a very fine presentation about our report at that hearing and then answered some very difficult questions, I thought, exceptionally well. They were fairly tough questions, but I think he did the committee proud. At the end of that presentation the assembly moved an urgency motion, which I would now like to read into Hansard:

That the 2003 National General Assembly of Local Government:

Congratulates the Chairman, Deputy Chairman and Members of the House of Representatives Economics, Finance and Public Administration Committee on the bipartisan support in the Federal Parliament and the conduct of their Inquiry into Cost Shifting onto Local Government;

2. Applauds the Committee's finding that cost-shifting is imposing a serious financial burden on Local Government;

3. Supports the recommendations that call for:

a. formal recognition of local government by resolution of the House of Representatives;

b. a COAG summit on intergovernmental relations in 2005, and

c. an intergovernmental agreement between the three spheres of government on the roles and responsibilities of Local Government and funding sources to meet those responsibilities;

4. Notes that some recommendations are complex and will require further analysis, but that Local Government is committed to working collaboratively with the Australian, State and Territory Governments to fix cost shifting and the inadequate funding of councils in a timely manner.

That motion has just been moved at the National General Assembly of Local Government. I do not think that in my five years in this parliament, which is short compared to some, I have seen a report welcomed and endorsed so unanimously, particularly by the body that is the recipient of the report and on which the findings will have the most impact. That was very heartening for all members of the committee, and I did want to record that in Hansard.

The other remarkable thing about this report is that—while yes, it is bipartisan—it has been welcomed by the minister and the shadow minister and both sides of the parliament have endorsed it and stated that they are committed to working towards the resolutions in it. I want emphasise that, because I have never been involved in something that has raised expectations as greatly as this report has. Again, having been at the local government's national assembly, I think it would be traumatic, to say the least, if the government were to walk away from this report without a response—and it could be either side of the parliament in government post the election; of course, I am hoping it will be us. There has been far too much work put into this report. There have been far too many expectations and far too much hope pinned on it for something not to happen. I want to emphasise that we do not want to see this report—like a lot of others which I have been involved with—sit on a shelf and not responded to. That would just be too tragic. I think it would destroy the faith that local governments have placed in the federal government to deliver on some of the issues that they raised with us.

At the outset I will say a very big thank you to the members of the secretariat, who are really the driving force behind all committees. Anybody in this place who works on committees knows that that is the case. I want to thank Susan Cardell and Vanessa Crimmins for the amazing amount of work they put into the report. I also want to place on the record my thanks to Ryan Crowley, Katie Hobson and particularly Richard Webb from the Library who did much of the research and historical background that went into this report. This is a phenomenally thick report; there were over 400 submissions and there was a lot of detail to go into. If anybody gets a chance to read the report, chapter 6 has a fine historical line about the funding that goes to local government. Richard from the Library, who is a terrific resource, wrote that.

Ryan and Katie had the terrific job of getting us on and off planes. At times we were very unhappy with them getting us on and off planes, particularly the day in Tamworth when we were meant to be somewhere else. We ended up on six very small planes that were getting smaller. When I asked Ryan, who was looking out the window, where the tarmac was, he replied, `It is the grass verge down there.' That day I figured I really did hate the secretariat a lot because they were taking me to far-flung places that I did not want to go to. We were going into Barraba at that stage and we were running very late, not because of anything we did—


Mr Barresi —The poor people of Barraba!


Ms BURKE —The people of Barraba were delightful. There were about six or seven councils represented there, members of which had driven some phenomenal miles to meet with us. The day we went to Longreach the CEO of the Diamantina shire told us that he had driven for seven hours to meet with our committee—but it was okay because his wife needed a haircut. That spoke volumes to me about the importance of this inquiry and the importance that local government was placing on the committee to listen to them. I will be honest, on some occasions I did not want to listen to what was being told to me, and some local councils did not want to listen to what I was telling them. But at least there was a full and frank exchange of views, and it was fairly entertaining at some stages.

My favourite hearing, I have to admit, was in Perth where the CEO of the Shire of Yalgoo managed to get the word `shagging' recorded in the Hansard. He is probably the only man in the history of this parliament to do that. He gave us a fascinating insight into local government when he said that local government in Yalgoo is the last man standing: federal departments have gone, state departments have gone and the local government is the only one there. I would like to read from his presentation at the hearing. I think it sums up a lot of the problems that people were expressing to the committee. Mr Olsen, the CEO of the Shire of Yalgoo—anyone who can still tell me where it is, congratulations—says:

The problem with specific purpose grants is that they fall into programs that are usually designed by someone somewhere else, largely in Canberra or Perth, many of whom probably could not point to Yalgoo on the map. Occasionally, a program comes along that we take advantage of and when it fulfils our needs it is really wonderful—a lot of the time it does not. For example, we have a small community in the southern end of our shire, Payne's Find, which has very poor water. The supply for the water has been there for 90 years; the plant is at the end of its economic life and the water is rich in faecal coliforms and also in arsenic.

There is a community water program, which I was told on inquiring about it that it is meant primarily for farming communities and not for mining communities. The majority of people there are very small miners; it is not a big company. Presumably whoever designed the program thought that arsenic was better for miners than for farmers. That is the sort of problem that we face.

So I think that was the sum total of what we saw time and time again. The programs were there but they were not designed specifically for the people receiving them. Time and time again we heard that program delivery is wonderful but in particularly small regional remote communities—I think 80 per cent of Yalgoo's population is Indigenous—it is not specific to them. We kept hearing that local government is about local expectations. I took exception to this. If anybody wants to go through the transcripts, I said that a lot of what local council is about is about managing those expectations; that they are the ones who know those expectations. General purpose funding is the way to go for most of these councils so that they can use that funding on the ground for themselves. But it should come with strings attached. One of the distressing things about the inquiry was discovering that money goes into a large pot, whereas the federal sphere of government actually have no way of accounting for that money. I find that quite distressing, so the report does say, `Yes, here is a radical new form of funding model, but that funding model must have an appropriate acquittal mechanism so that we can actually audit that process.'

In yesterday's Herald Sun, there was an article called The age gap grows. It talked about a report that ALGA commissioned and just handed down and, again, it highlights the issues we were finding across the countryside. I would like to quote from Kate Jones's report. She says:

The growing generation gap between the city and the country will put councils under a huge financial burden, a report has found.

... ... ...

Alga president, Mike Montgomery said the ageing balance was a financial threat to country councils.

“We will be faced with sharply increasing demand for human services, growing pressure to provide more sustainable age-related infrastructure, such as aged care facilities and community amendments,” Councillor Montgomery said.

“And there will be a restricted ability to raise revenue through rates and users charges.”

We also found that communities are providing more and more human services. They have moved from the traditional rates, roads and rubbish and have gone into human services, predominantly in aged care. In my state of Victoria, councils are the major providers of home and community care packages. The financial shift from both state and federal government onto local councils is becoming a huge impost upon them. We need to find ways forward to resolve these problems.

As I said in my address to the House when we tabled the report, it seems a bit absurd that the report's major findings—considering we were talking about cost shifting—concern developing a new, and I would say radical, form of funding. But that is where the evidence led us. That is where we have gone. We have not ignored cost shifting. We have put in parameters that hopefully will ensure that cost shifting is a thing of the past, because we cannot afford the duplication and we cannot afford the waste; nor can we afford communities saying no to funding because they know in three years time that someone will pull the pin and they will be left carrying the can. Local government is fairly averse to saying, `Yes, we'll take on a road safety officer,' having the position funded for three years and then saying to the community, `We're terribly sorry. We're now getting rid of the road safety officer.' What happens then is that they bear the cost, and they cannot continue to do it. But councils need to get smarter. They need to take more responsibility. Just because your community says, `Let's do something,' does not mean they have to do it.

I was mortified to hear at one of our hearings—and I will not name names—that a council had bought a private school. They had purchased a private school. I have now been told subsequent to the hearing that they have purchased another private school, because the community was up in arms that this private school was going under. That is commercial reality; I am terribly sorry. But the good people of this community put so much pressure on the council that they have now bought two private schools that are not functioning. They are not making money. They are losing council money. I would not say it is the council's responsibility to run private schools but the community expected it, so the council did it.

In another place I was again taken aback to be told, `We had to roll SBS out to everybody in the town, because everybody in metropolitan areas has got SBS.' Did you actually do an analysis of who would be watching SBS in your predominantly Anglo-Saxon community? Did you do an analysis of the take-up rate? Did you do an analysis of cost sharing? `No, we just decided everybody should have it, and so we went and purchased it at a massive expense to the local council.' So I think councils need to take more responsibility for the actions they take.

We heard a lot about infrastructure rundown. This is true, and it needs to be addressed. The report makes some significant recommendations in that area. But, again, councils sometimes make choices to let infrastructure run down. Having a nice community festa is a wonderful thing, but not at the expense of your drains going down the tube or roads not being sealed or graded. It is difficult; it is hard.

Some of these costing choices are not glamorous because people do not see them, but they certainly see them when their drains and sewerage areas are blocked up to kingdom come and everyone is crying foul at the council for not spending money. We are all working off a finite financial resource, but we must find the means of doing it.

Again I would like to quote from some of the committee's transcript. Councillor Chong, the Mayor of Whitehorse, one of the municipalities in my electorate, said at the introduction to the Boxhill hearing:

Past state and Commonwealth governments of both political persuasions are responsible for this.

that is cost shifting—

Significantly for local government, the damaging effect of cost shifting has been to make councils a service delivery arm of other spheres of government. In so doing, it has reduced the discretionary capacity of local government to fund local priorities and has placed impediments to a council's ability to get on with the business of community capacity building and developing its local community.

I think that is true. In some respects, councils are buying into funding rounds and saying, `We will now run a drug/alcohol program because we think we can do it, or we can do that because funding is offered.' That is not the way to go. We heard from very brave council CEOs who have now rejected funding and particularly in-kind funding. They say, `We will give you $100,000 if you are prepared to match $100,000.' It is all nice and good, as one councillor said on record, to have a beautiful functioning and attractive toilet block but, if it is not what the community needs, then why should we go there? The money could be better used elsewhere.

I recommend the report to the House. I hope everybody reads and digests it. We have raised an enormous number of expectations through the good offices of our country. Local government is a genuine arm of government and we have recognised that. We have said to them: `You are not some add-on or some second-rate group of individuals; you are performing a specific role of government.' I hope some deliberate and genuine action is taken in respect of this committee inquiry. I recommend the report to the House and place on record my thanks to the chair, David Hawker, for all the excellent work he has done in ensuring that we have a bipartisan report. Either side could have taken cheap political shots in this but neither party did.