Council welcomes Federal grant and the return of indexation

Hawkesbury City Council has received a $4.2 million Financial Assistance Grant for 2016/2017 to help deliver vital services and infrastructure to the Hawkesbury.

The Australian Government has provided Financial Assistance Grants to local government since 1974–1975, the Mayor of Hawkesbury, Councillor Mary Lyons-Buckett explained.

“The Financial Assistance Grants are a regular source of income received by Council and we will continue to use the funds for programs and projects such as services, roads and infrastructure renewal as we have in previous years,” the Mayor said.

There was a freeze on the indexation of the grants in 2014 which placed significant pressure on Council’s budget.

“According to the Australian Government’s own estimates, its 2014 budget move to freeze the indexation of Financial Assistance Grants cost local communities across Australia more than $600 million worth of services and infrastructure over the three years,” Councillor Lyons-Buckett said.

“As part of the 2017/2018 Federal Budget, the Australian Government announced the reinstatement of indexation to Financial Assistance Grants from 1 July 2017, honouring their commitment to local communities.

“Whilst Council welcomes the return of the indexation to keep pace with costs, it will still take Councils a long time to recover from the freeze because it has permanently reduced the base level of the Financial Assistance Grants payments.”

Background

The Financial Assistance Grant program is provided under the Local Government (Financial Assistance) Act 1995 (the Act). The Financial Assistance Grant program consists of two components:

  • a general purpose component which is distributed between the states and territories according to population (i.e. on a per capita basis), and
  • an identified local road component which is distributed between the states and territories according to fixed historical shares.

Both components of the grant are untied in the hands of local government, allowing councils to spend the grants according to local priorities.

Visit here for more information about the grants.

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