Speeches: 2004
President's address
The Butcher Report sought to encourage the Commonwealth, state and local governments, and regional industries, to establish a national framework for investment in local roads of regional significance. Butcher recommended a two pronged approach. First, it called on the Commonwealth to kick in $700 million over five years - or $140 million a year - for the maintenance of local roads under the control of all councils, rural and urban. Second, it called on the Commonwealth to establish a regional transport infrastructure fund to provide local government with the capacity to respond to regional economic activity.
Address to National Local Roads Congress
Councillor Mike Montgomery
President, Australian Local Government Association
12 July 2004: Adelaide
- Mayor of Barossa, Brian Hurn
- President of the Local Government Association of South Australia - Councillor John Legoe
- Martin Ferguson - Shadow Minister for Transport and Infrastructure
- fellow delegates
- ladies and gentlemen
Five years of the National Local Roads Congress
As conferences go, the National Local Roads Congress is a young one. This is just the fifth Congress. But it is also the largest – with more than 530 delegates registered to attend.
In fact the Congress has gone from strength to strength, attracting more delegates each year to discuss and debate key transport issues and local government roads.
But the success of this Congress cannot be measured simply in terms of turnout.
This is a working Congress, established not as a gabfest, but as a forum to fight for local roads.
As such, it is worth reflecting on what we have achieved so far.
The very first Roads Congress was held in NSW in my home town of Moree.
It was convened because we wanted to get action to address the deteriorating state of local roads, particularly regional roads.
The Butcher Report
That Congress established a steering committee to develop a plan to address the road funding crisis.
That plan was set out in the Moree Rural Road Funding Report – better known today as the Butcher Report, after the chair of the steering committee, Ted Butcher.
The Butcher Report sought to encourage the Commonwealth, state and local governments, and regional industries, to establish a national framework for investment in local roads of regional significance.
Butcher recommended a two pronged approach.
First, it called on the Commonwealth to kick in $700 million over five years - or $140 million a year - for the maintenance of local roads under the control of all councils, rural and urban.
Second, it called on the Commonwealth to establish a regional transport infrastructure fund to provide local government with the capacity to respond to regional economic activity.
We wanted the Commonwealth to provide $600 million of new funding over the five years for this purpose. An additional $600m was sought from three sources, the states, local government and the private sector.
The total Butcher package involved $1.3 billion from the Commonwealth and $600m from other sources – making a total investment of $1.9 billion over five years
That was the ask.
How have we fared?
Well, here we are, five years after Moree. How have we done?
The Moree Congress was held in March 2000. By the end of the year, the Commonwealth had announced that it would provide $1.2 billion over four years to councils through the Roads to Recovery program.
And in January this year, it announced that the program – with some modifications - would be extended for a further four years at a cost to the Commonwealth of a further $1.2 billion.
I might add here that we were delighted that Labor in opposition agreed to match the original R2R commitment. More recently, Martin Ferguson announced that Labor was committed to the introduction of a Roads to Recovery-style program should Labor win the next election.
In total, the Commonwealth's Roads to Recovery package is now worth $2.4 billion over eight years.
That equates to $300m a year from the Commonwealth, well in excess of the $260m a year sought from the Commonwealth by Butcher.
And there is no requirement for matching funds from either state or local government, merely a commitment to maintain their funding in real terms.
Roads to Recovery funding has been applied to all councils, metropolitan and regional - though the bulk of it has been allocated to regional areas.
For example, of $1.2 billion allocated under the current program, $850m – or just over 70% - will be spent on local roads in regional areas.
By any measure, you would have to say that the exercise we embarked upon at the first Congress five years ago has been an extraordinary a success story.
And I'd like to pay tribute to the work of everyone here today who has worked so hard to make this long running campaign bear fruit.
I also want to thank all of you who contributed to the campaign to have Roads to Recovery renewed for a further four years. This was no easy task.
Renewal of Roads to Recovery
In July last year, our intelligence was telling us – in no uncertain terms – that we were facing an uphill battle.
Yes, John Anderson, Wilson Tuckey and – more recently – Ian Campbell - were strong advocates for renewal. But there were equally strong voices that were steadfastly opposed to this course of action.
That's why we needed to turn backbenchers on all sides of Federal Parliament into advocates for renewal.
Our combined lobbying efforts have paid off. There is now a small army of federal MPs and senators who are – in every sense of the word – friends of local government and local roads.
And they have good reason to be.
Roads to Recovery is an outstanding example of an effective Commonwealth/local government partnership.
It is producing very real and tangible results for Australian communities.
It is replacing dangerous bridges and upgrading intersections.
It is repairing roads and improving traffic flows.
It is boosting economic development, creating employment and improving the lives of countless Australians through 12,000 projects from our city centres to remote communities.
By renewing the Roads to Recovery program, John Anderson and Ian Campbell met many of the goals we set in Kalgoorlie last year.
We wanted Roads to Recovery renewed for a further four years.
And we wanted the funding to continue to go directly to councils to be spent on priorities set by councils.
Our core goals have largely been met and we thank them – on behalf of the communities we serve – for their efforts and for their work.
Steering Roads to Recovery through Cabinet late last year was no mean feat.
Outstanding issues – R2R2 Strategic Component
However, with every rose there comes a thorn. And here I switch from our broad strategic goals to operational issues.
Our thorn takes the form of the Commonwealth's reluctance to set regional or even state allocations for the $400m strategic component of the renewed Roads to Recovery program.
As you will be aware, under Roads to Recovery Mark 2 – or R2R2 as it is now known - councils will continue to get two thirds of the $1.2 billion in much the same way as under the present program.
But one third – or $400m – will be made available to councils for strategic projects of regional economic and social significance.
This funding will apply to regional and outer metropolitan areas to – and I quote from the AusLink white paper - 'enhance the ability of regional industry and communities to compete in the national and global marketplace'.
The Australian Government says it will not allocate funds on a regional or state-by-state basis. They have, however, said the funds would be – and again I quote - 'fairly distributed'.
This is an uncertain outcome.
The Commonwealth had consulted with ALGA and state local government associations about how the strategic component might work.
Our strong and united message was clear: we wanted the funds to be allocated on a regional basis, within set state shares.
Simply saying the funds would be 'fairly distributed' will be cold comfort for many councils.
One small consolation has been the Government's concession that it will recognise that some large, remote councils will constitute a region in themselves.
Ian Campbell has undertaken to discuss this issue further with local government and we will all be keen to hear what he might say on this matter later today.
Broader funding issues
I want to move on now to the broader issue of local government financing and where new opportunities might lie to help us address the continuing shortfall in road funding.
Roads to Recovery is providing substantial assistance to councils to address the road maintenance backlog. But – with a $640 million a year funding gap – Roads to Recovery is – as the program review found – only helping to slow the rate of decline in local roads.
Even with Roads to Recovery, the job is far from finished.
So, where do the longer term solutions lie?
I think there are two approaches.
Fair share of taxation revenue
First, ALGA has argued long and hard that we need to replace the current, archaic system of financial assitance grants with access to a fair share of national taxation revenue. That means growth funds.
Under the current arrangements, councils are squeezed from all directions. We face increasing demand for the provision of new human services, but are expected to maintain and improve our traditional, property based activities.
At the same time, we face a growing infrastructure crisis. Local government owns and maintains assets now worth more than $100 billion, including roads, bridges, libraries, pools, cultural facilities, sport stadiums, entertainment complexes and airports. Much of this infrastructure dates from the post-war period and is in dire need of repair or renewal.
We need access to a fair and decent source of growth funds. The state governments have already been down this path. They have successfully made the switch from flat-lining Commonwealth financial assistance grants to a secure share of national taxation revenue via the Goods and Services Tax.
In fact, the states and territories will be almost $9 billion better off by 2008 as a result of the GST.
The same kind of change can - and must - occur for local government.
Specific Purpose Programs
The second approach follows the path already blazed by Roads to Recovery.
Roads to Recovery is seen in Canberra as a highly successful way of delivering important transport outcomes at the local level.
Already, the Commonwealth is looking at how similar programs can be devised to deliver better outcomes in areas such as human services and environmental protection.
Specific purpose programs funded by the Commonwealth could deliver more money to local government for core functions that also meet federal priorities.
I hope that both these approaches to local government financial issues will be addressed in the reponse of the major parties to David Hawker's cost shifting report – Rates and Taxes: A Fair Share for Responsible Local Government.
We will, of course, hear today from two federal heavyweights.
Shortly, we will hear from Labor's Infrastructure and Transport spokesman, Martin Ferguson, a long-term and very welcome participant at this Congress. In fact, it will be his fourth.
Later today, we'll hear from Ian Campbell – a strong advocate – as we've heard – for the Roads to Recovery program.
The proximity of the election makes their contributions here today particularly significant.
They can be assured that we will hang off their every word.
The Congress will – of course – cover more than just AusLink and Roads to Recovery – critical though they are.
We will also discuss regional transport security, regional road programs, road safety and community transport.
We will hear examples of best practice from councils and transport organisations from across the country.
We will also have the opportunity to share our mutual experiences during the less formal parts of the program.
There will be many opportunities to question our speakers, to engage in discussion and participate in debate. I encourage you to do so. This is your Congress. Make full use of it.
Finally, I'd like to thank the Mayor of Barossa, Brian Hurn, for having us here in this remarkably beautiful and significant part of Australia.
We look forward to enjoying your hospitality.
I'd also like to thank our sponsors, the Federal Department of Transport and Regional Services, McArthur Management Services and the South Australian Department of Transport and Urban Planning. This Congress would not have been possible without your generous support.
So, please, enjoy the Congress, participate in the debates and – at the end of the day – let's keep doing what we do best – fighting for the transport needs of our commuities.
Thank you.
Councillor Mike Montgomery
2004 National Local Roads Congress
12 July, 2004
Tanunda, South Australia
