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Federal Government Financial Assistance Grants preserved for NSW Councils

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Other Media Statements [Minister for Regional Development. Territories and Local Government] [Minister for Transport and Regional Development]

M e d i a

[Michael Ronaldson, Parliamentary Secretary] [Departmental]

R e l e a s eTHE HON ALEX SC Minister for Regional Development, Territories and 1 S56/98 4 June 1998


The Federal Minister for Local Government, Alex Somlyay told the joint NSW Local Government and Shires Association seminar in Sydney today that unfavourable views run in some local government circles that the Federal Government has reduced financial assistance to local government simply don't stand up to examination and scrutiny.

He said the Federal Budget is appreciated by local government in NSW. The NSW local government association leaders, Councillor Peter Woods OAM of the Local Government Association of NSW and Councillor William Bott of the Shires Association of NSW have jointly signed a letter to me endorsing the major wins for local government in this Budget.

"The Government has fulfilled its commitment to restore full indexation to the financial assistance grants. Every year the Commonwealth provides around 80% of all government funding to local government.

"In 1998-99 the Commonwealth will provide $1,229 billion to local authorities throughout Australia in financial assistance grants. This represents an increase of $24 million over last year and includes, as promised, adjustments for both inflation and population growth.

"I want to say something very frankly about the decision not to restore the FAG's (financial assistance grants) base in this Budget. This decision was taken in line with the continuing need for the local government contribution to national savings. Councils were quarantined in 1996/97 and made their contribution in 1997/98 and again in this coming financial year.

"Despite these adjustments, FAG's paid to NSW in 1998/99 will be $397.7 million, an increase for NSW of $7.5 million. No one likes making sacrifices, and I understand the complaints being made by some councils, but the fact is that we are now on the brink of sharing in the benefits of these sacrifices. The result of the 1998/99 Budget, the $2.7 billion surplus is the product of this sacrifice," Mr Somlyay said.

He said the political process including pre Budget representations from the ALGA (Australian Local Government Association) and State organisations produced two real valuable wins for local government. The Government has budgeted for $5.4 million to continue the Local Government Development Programme in 1998/99.

"The $3.7m National Bridges Survey will be funded from general revenue, not taken from FAG's or LGDP payments made to urban and regional councils. In a tight budgetary environment this is an excellent result for local government," said Mr Somlyay.

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Further information: Graeme Hallet (Minister's Office) 02-6277 7060 16/10/1998