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Federal Financial Assistance Grants to Councils have increased.



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M259/2001 5 September 2001

FEDERAL FINANCIAL ASSISTANCE GRANTS TO COUNCILS HAVE INCREASED

Federal Financial Assistance Grants to Councils have risen, contrary to reports in the media today, Federal Local Government Minister, Senator Ian Macdonald said.

Responding to reports of a motion carried by the Local Government Association of Queensland, Senator Macdonald said that he supported the LGAQ's efforts to negotiate with the State Governments for a fixed share of GST growth revenue, however that move was unrelated to Federal grant funding which has increased.

"Overall, Federal Financial Assistance Grants to Councils rose by around $46 million this year, an extra $9.6 million for Queensland Councils," he said.

"The facts of Financial Assistance Grants to Councils speak for themselves.

Year Federal Funding Nationally ($billion)

Federal Funding for Queensland ($ million)

Increase to Qld this year

Increase to Qld under Howard Govt

1995/96 $1.165bn $212.5m

Up $9.6 m Up $45m 2000/01 $1.328bn $247.3m 2001/02 $1.375bn $256.9m

"This doesn't include the extra $250 million over four years that Queensland Councils will receive as part of the Federal Government's Roads to Recovery programme."

Senator Macdonald said that the independent Commonwealth Grants Commission had recently found that while the Federal Government's contribution to Local Government revenue had increased overall since the 1970's, State contributions had decreased from around 15% to just 7.1%.

"In Queensland, the State contribution has declined from 26% to 7% of local government revenue," Senator Macdonald said.

"So it makes good sense that the LGAQ should ask the State for more revenue to cover the shortfall and a share of the GST growth revenue is the logical source of that funding."

Media contact: David Moore 0417 774 724