LOCAL GOVERNMENT INFRASTRUCTURE
Mr KEVIN ANDERSON:
My question is directed to the Minister for Local Government. What is the Government doing to help New South Wales councils invest in their most important local infrastructure projects?
Mr DONALD PAGE:
I thank the member for Tamworth for his question. I congratulate the member on the wonderful work he is doing in the electorate of Tamworth and his keen interest in infrastructure, particularly in regional areas. We just heard from the Treasurer that a key focus for this Government is improved infrastructure whether at State or local government level. By way of background, members may or may not be aware that the former head of Treasury in New South Wales did a study into the economic sustainability of local government in 2006, and found that about half the councils in this State were struggling financially. He also found that as a result of that economic struggle there was a significant infrastructure maintenance backlog in local government areas. That was in 2006. Those opposite had six years to address that issue but what did they do? Nothing.
Order! I remind Government members that the Minister does not need their assistance.
Mr DONALD PAGE:
By contrast, The Nationals and the Liberals, through the then shadow Minister, recognised that local government has serious issues to deal with in infrastructure backlog. The Government announced before the last election that should we be elected we would put in place an infrastructure renewal scheme which would provide interest-rate subsidies for councils if they choose to borrow money to improve their infrastructure backlog. The Government indicated it would provide a subsidy of 50 per cent of whatever interest was being charged on those loans.
Unlike the former Government, which always made promises and then underperformed, this Government only promised to provide 50 per cent infrastructure subsidy. But we are providing higher than that—we are providing the first 4 per cent on loans.
At the moment the majority of loans are around 6 to 7 per cent, so the Government has made promises and then over-delivered. The Government will provide the first 4 per cent of any loan that a council takes out to overcome infrastructure maintenance backlogs. That was announced by the Treasurer in the Government's first budget—and what a good Treasurer he is. The Government announced $70 million over five years would go towards the payment of interest subsidies. One of the strengths of this scheme is that it provides for a broad range of assets. Whatever projects a local government has—swimming pools, libraries, road, water supply or sewerage—those projects will all be eligible under the scheme. The Government expects that, depending on interest rates over the next couple of years, this will unlock about $750 million to $1 billion worth of additional investment in infrastructure across the councils of this State. I think that is commendable.
In terms of the criteria that apply, as I said a moment ago, obviously it will be a broad range of products and infrastructure, but also the loans will typically be of $1 million or more. However, if a smaller council has two or three projects and they want to combine them to make a $1 million project that is okay. I am pleased to announce that after having launched the scheme in the middle of January, 76 councils have expressed interest in participating in this scheme. Indeed, three of them are from the electorate of the member for Tamworth—Narrabri, Tamworth and Warrumbungle. Seventy-six councils—that is half the councils in New South Wales—have expressed an interest in participating in this scheme.
Ms Linda Burney:
But have they applied?
Order! I call the member for Canterbury to order.
Mr DONALD PAGE:
I will come to that. About 66 of those expressions of interest have been for one single project of $1 million or more and the balance of 10 councils have combined three or four projects to make up $1 million. Those councils expressing interest have until 30 March to put in their applications. Given the infrastructure backlog we have in this State we will see many of the councils that have expressed an interest and other councils—now that they realise they are on a good thing, being able to have the first 4 per cent paid on their loans—will have their applications in by 30 March. For the edification of members opposite, this has been warmly welcomed by the Local Government and Shires Associations. I have not got time to read out the press release. [Extension of time granted.
I will put on the record the supportive comments made by the Local Government and Shires Associations. In a press release dated 11 January Mr Ray Donald stated:
The Local Government and Shires Association of New South Wales have welcomed the commencement of the New South Wales Local Infrastructure Renewal Scheme.
President of the Shires Association of New South Wales, Councillor Ray Donald, has acknowledged and thanked the Minister for Local Government—
I did not write this—
for launching the scheme which honours an important election commitment to local government in New South Wales.
He stated further:
This subsidy, as part of the scheme, aims to encourage councils to make greater use of borrowings to accelerate investment in infrastructure backlogs.
President of the local government association, Councillor Keith Rhoades, stated:
The LGSA have strongly advocated for the provision of low interest loans by the New South Wales Government to help councils deal with critical infrastructure backlogs. We are pleased that the latest scheme specifically targets these backlogs.
That is a strong endorsement from the local government sector. I take the opportunity to commend and thank the local government sector for their cooperative approach to the new Government.
Order! I call the member for Maroubra to order.
Mr DONALD PAGE:
The relationship between the local government sector and the previous Government was poisonous. When I came to this position the stories I heard about the disrespect that the former Government had for the local government sector were shocking. As a result of the Destination 2036 exercise, where we put all the local government players together, there has been a cooperative relationship.
Order! I call the member for Lakemba to order.
Mr DONALD PAGE:
The Government recognises that there are serious issues with regard to the sustainability of local government in this State and we need to work with the local government sector to ensure that we have long-term sustainability of local government. The Government wants local government to be as strong as it can be. Even five years ago—and the situation is worse now—half of them were struggling financially.