Councils say they’ve been left in the cold by the federal government’s infrastructure policy statement, which prioritises nationally significant projects that are beyond the reach of local government.

Infrastructure Minister Catherine King says the statement, released on Tuesday, commits the government to taking a ‘strategic view of infrastructure investment’ focused on “nationally significant land transport projects in partnership with our stakeholders”, including those with contributions starting from $250 million.

ALGA president Linda Scott says that isn’t fair on councils who are struggling to provide basic local community infrastructure.

“Currently, not one of our 537 Australian local governments is able to provide a $250 million co-commitment for a single infrastructure project,” Cr Scott said.

“Local governments call on Minister King to explain how the federal government will partner with us to improve the resilience, safety and productivity of our local infrastructure and see funding for local governments and our local communities increase in this review.”

Release of infrastructure investment review

The statement came ahead of the government’s release on Thursday of the independent strategic review of the Infrastructure Investment Program, which will see scores of council projects no longer getting federal funding.

See the full list here.

Ms King said the independent review found while local government programs are a critical funding mechanism for local roads and infrastructure, they are administratively burdensome and lack sufficient funding or certainty.

“The Commonwealth Government’s response to these recommendations will be announced in coming days,” she said.

Reshaping how projects are funded

Ms King says the new policy direction will ensure properly planned and targeted infrastructure gets the goods.

“The Albanese Government will invest in the projects that …. shape our cities, our regions and our nation,” she said.

She says it will also reshape how the Commonwealth funds projects by preferencing 50:50 funding with the states and territories.

To be considered, projects will need to have at least two of the following characteristics:

• Federal Government contribution of at least $250 million; and/or
• alignment with Government priorities as articulated in the Infrastructure Policy Statement; and/or
• situated on or connected to the National Land Transport Network and/or other key freight routes; and/or
• supporting other emerging or broader national priorities – such as housing or critical minerals

Local works better than megaprojects: report

Cr Scott said more needs to be done to address the growing need for local government infrastructure as cost of living pressures bite.

“We welcome Minister King’s commitment to improving productivity, liveability and sustainability through infrastructure spending, but she must explain how her review will result in increased local government infrastructure funding, not cuts,” she said.

Cr Scott noted that research published by the Grattan Institute this week said taxpayers would get better value for money if the government redirected funding away from ‘megaprojects’ towards local community infrastructure needs, such as roads.

Recent research commissioned by ALGA also showed a flatlining of per capita local government expenditure over the past decade despite rapid population growth and increasing demand for volume, quality and reliability in public services.

“By international standards, investment in Australian local governments is small, forcing councils to operate with very modest resources, according to SGS Economics,’ Cr Scott said.

“Allowing for the differing scope of local government across nations, Australian local governments’ share of GDP ranks amongst the very lowest of comparator nations.”

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