Councils in new funding strife

Paul Bell

COUNCILS across Australia could suffer significant financial trouble unless the nation holds a Constitutional referendum on the financial recognition of local government, according to the Local Government Association of Queensland.

LGAQ president Paul Bell said negotiations between the Federal Government, the Coalition, independents and Greens should include setting a date for such a referendum.

“On the basis of minority government, the independents and Greens are now crucial,” he told the LGAQ conference.

The previous Labor government had supported a referendum in the next term of Parliament, but the Coalition’s pre-election commitment was dependent on public support, he said.

Cr Bell said a High Court decision last year found the Commonwealth may not have the power to directly fund local government, putting at risk about seven per cent of local government revenue.

“Both major parties have recognised there is now a risk of a constitutional challenge to established programs such as the government’s Road to Recovery and the Coalition’s proposed Bridges Renewal Program.

Cr Bell said there was more chance of winning a referendum on financial recognition than on more sweeping calls for institutional recognition of local government, which would give councils status comparable to state governments under the Constitution.

“Experience shows that voters are more likely to support amendments that fix a known problem such as this,” Cr Bell said. He promised a grassroots education campaign next year.