Australian Local Government Association

For information about ALGA's analysis of the Budget regarding Key points please contact:

Larissa Karpish
Assistant Director, Ageing, Finance and Economic Policy
Phone: 02 6122 9427   
larissa.karpish@alga.asn.au

Fact sheet 1: Key points

• Financial Assistance Grants (FAGs) to local government will increase in 2005-06 to $1,626 million (consisting of $1,126 million General Purpose Grant and $500 million in local roads grants). This is $86.5 million above the current financial year, and in real terms an increase of 1.6%. It also includes the $9.6 million underpayment from 2004-05.
• In 2005-06, FAGs represents 0.81% of total Commonwealth taxation revenue. This will decrease to 0.78% by 2008-09.
• Total direct funding for local government in 2005-06 will be $2,066 million. This includes FAGs, Roads to Recovery and other Specific Purpose Payments (SPPs).
• This is in the context of a Federal Budget surplus of $8.9 billion
• As part of Auslink, Roads to Recovery was renewed for four years from 2005-06. An additional amount of $300 million per annum will be made available to local government for upgrading and maintenance work on local roads. A further $150 million over 5 years will be allocated for local land and transport infrastructure of strategic regional importance.
• The Australian Government has extended the Blackspot road safety program. It will provide $90 million over two years from 2006-07 to continue the Road Safety Black Spots program. The program seeks to identify and address dangerous locations on Australia's roads.
• $2 billion has been committed to establish an Australian Water Fund. This is a major investment in water infrastructure, improved environmental knowledge and water management. This includes the $200 million over five years for the Community Water Grants program.
• A number of initiatives have been introduced to help local government implement emergency management strategies. These include $1 million in 2004-05 to develop a plan for emergency management at the local level; $30 million over four years for a grants scheme to strengthen emergency preparedness and capacity at a local level; and $2 million over four years to establish an Office of Local Government Emergency Management.
• The government has committed $103 million for the Indigenous Housing Initiative.
• As part of its election commitments, the Australian Government announced the Rural Medical Infrastructure Fund. The Government will provide $15 million over three years to rural councils to help them establish community medical facilities and recruit and retain general practitioners. Funding will help meet the cost of purchasing and fitting out facilities required for general practitioner services.
• The Australian Government has also introduced a Regulation Reduction Incentive Scheme. This is a competitive grants program to encourage local government to reduce regulatory complexity and compliance requirements for home-based businesses ($43.6 million over three years).
• The Australian Government has provided additional Specific Purpose Payments for Tasmania. The Strengthening Tasmania scheme ($12.6 million over four years) is to be used for projects to enhance infrastructure, community facilities and services.
• As part of the Australian Governments commitment to additional childcare place, local government will receive an additional $21.4 million over four years.
• The Regional Partnerships program will be extended by $4.8 million over two years to contribute to regional infrastructure and community projects that were committed to during the election campaign.