HOUSE OF REPRESENTATIVES STANDING COMMITTEE ON ECONOMICS, FINANCE AND PUBLIC ADMINISTRATION INQUIRY INTO LOCAL GOVERNMENT AND COST SHIFTING
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The Hon. DUNCAN GAY (Deputy Leader of the Opposition) [9.21 p.m.]: The Federal House of Representatives Standing Committee on Economics, Finance and Public Administration has commenced an inquiry into local government and cost shifting. This is an important inquiry that is long overdue.
The Hon. Dr Brian Pezzutti: It's about time.
The Hon. DUNCAN GAY: As my colleague said, it's about time. The committee has received more than 250 submissions from individuals, community groups, councils and regional organisations across the country as well as from peak representative bodies for local government in the States and Territories. Some of those submissions are very interesting, and the fact that 65-or more than one quarter-of them come from New South Wales councils gives an indication of the concern about cost shifting in this State. Those 65 submissions represent more than one-third of the 172 local councils in New South Wales and they contain some common themes. Put simply, councils are fed up with the burden of unfunded mandates and the allocation of additional functions and responsibilities placed upon them by other tiers of government-mainly the New South Wales State Government. Lgov NSW-which is the new name of the Local Government and Shires Associations of New South Wales-made an interesting submission to the inquiry, and I commend the organisation for the content of its submission. In its introduction, Lgov stated:
If Local Government is to continue to meet the growing needs of NSW communities, it is essential that it has access to the required resources. It is becoming increasingly clear that the current financial base of NSW Local Government is inadequate to meet the growing demands being placed on it.
That is a fair statement, which is repeated in one form or another in all the submissions I have examined so far. A medium-sized North Coast council with an excellent track record stated in its submission to the inquiry that its ratepayers are expected to contribute about $1.6 million annually so that the council can comply with legislative requirements and additional responsibilities either imposed by or passed down from higher levels of government. The general manager of that council pointed out that $1.6 million from a total annual budget of $24.5 million represented some 6 per cent of the council's budget. It is a big ask to expect the council to then set its own works priorities. The submissions were received from councils ranging from the smallest to the largest in the State. A small council in the north-west of the State with just over 3,000 residents stated:
Local Government is increasingly being called upon to undertake what are currently "non-traditional" roles and this is exemplified in the delivery of health services. Council has recently had to outlay significant funds to attract a doctor to our town. Health services are currently the responsibility of State & Federal Governments not Local Government, yet Council was obliged to use ratepayers' funds to provide this most important "non core" service.
A major metropolitan Sydney Council with almost 64,000 residents stated:
There has been a significant and unsustainable level of cost shifting onto Local Government by the NSW State Government.
All the submissions list concerns about the extent of cost shifting from both the State and Federal governments to local government, but the overwhelming concern is about the actions of this State Labor Government. The House of Representatives committee is sitting in Canberra today and tomorrow and will then travel around the country taking evidence. I hope that the inquiry will formulate some sensible recommendations aimed at easing the burden on local government.
Just today I read some material from a coastal council informing a developer of what requirements he must comply with as part of a development application process. Of the 40 matters listed, just under half were required because of the policies of this State Government. Five were the result of Federal Government policies and programs. This becomes a de facto cost shift to local government because councils are expected to process and assess the documentation and to implement and regulate the policies. That is just one example of cost shifting and unfunded mandates. The submissions to the Federal inquiry contain hundreds of such examples, and I urge honourable members to acquaint themselves with those submissions. The Coalition has already announced the first stage of our response to the unfunded mandates issue in the form of a contract with councils. That concept has been welcomed by the councils that I have met over the past two months because it will require a Coalition government to negotiate with, and better inform, councils prior to the implementation of programs or policies. [Time expired.]