Port Stephens Council calls on federal government to restore indexation on financial assistance grants

Port Stephens Council wants the federal government to drop one of its budget saving measures that’s prevented $600,000 from being spent on roads and services.

Each year the council applies for more than $5 million financial assistance grants.

The federal government froze indexation on those payments in the 2014-15 budget that’s stopped those grants growing with inflation.

“On average, Port Stephens Council would receive an additional $200,000 annually as a result of indexation in the federal assistance grant,” the council’s financial services section manager Tim Hazel said.

“Council has an asset maintenance backlog of $15.5 million of which local roads make up 72 per cent. Council uses every available source of [rates and grants] untied revenue to reduce this amount annually.”

The council also uses its financial assistance grant to help maintain services to the wider local community.

Mr Hazel said these community wide services includes included; providing volunteer assistance and disability respite services; maintenance and upgrades to public halls, pools, cemeteries and playgrounds; delivering public libraries and surf lifesaving services; offering community group grants and individual scholarships; and supporting emergency response services and their facilities.

“The indexation would greatly assist council in ensuring these programs remain in operation if not at a higher level of service,” he said.

“Aside from rates the other major source of untied revenue for council is the federal assistance grant.

According to the peak national body for local government, the Australian Local Government Association (ALGA), the three-year freeze to indexation continues to have a significant impact on councils, particularly those in rural and remote areas.

“The Government promised to end the freeze and ALGA has urged them to honour their promise in the coming budget and ensure indexation is restored to Financial Assistance Grants in 2017-18,” ALGA president David O’Loughlin said.

“We need certainty in the federal budget this May that indexation will be restored to this critical funding and that our local councils will have the resources necessary to provide the level of services that every Australian community deserves.”

The financial assistance grants indexation freeze on all payments to councils nationally was expected to save nearly $1 billion when implemented in 2014.

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