Prime Minister Kevin Rudd suprised local government by announcing a further $245 million investment in local government community infrastructure and sector reform initiatives at the Australian Council of Local Government (ACLG), held today in Canberra.

Of the funding, $220 million will go to assist councils build and modernise community facilities, including town halls, libraries, community centres, sports grounds and environmental infrastructure.

A further $25 million will be allocated over two years to a Local Government Reform Fund to help councils better manage their infrastructure and plan for future needs in their communities.

The Fund will fast-track local government infrastructure financial and asset management and planning under nationally consistent guidelines. 

“Today's announcement is great news for every community across Australia", ALGA president Geoff Lake said.

"It shows that the Australian Government is serious about backing up its new partnership with councils with real financial investment into local government."

The overall investment takes to $1 billion the Australian Government’s total investment in the Community Infrastructure Program since November 2008.

"This is the most significant advancement in local government funding in almost a decade,” Cr Lake said.

"We know that local government across the country faces a growing infrastructure funding deficit of more than $14.5 billion and that somewhere between 10 to 30 per cent of councils are facing bankruptcy unless there is urgent reform to local government funding.

“This extra money announced today is another step in the right direction to begin to turn this financing crisis around."

Mayors and Shire Presidents from Australia's 565 councils met with the Prime Minister, cabinet ministers and other members of Parliament as part of the second gathering of the ACLG.