Alannah Mactiernan (Perth, Australian Labor Party) Share this | Hansard source

Local government in Western Australia will be losing $102.4 million as a result of this great surprise. We have been told by the Prime Minister, Mr Abbott, that this is the budget the community voted for. I can tell you that local government throughout Western Australia do not believe that they voted for this budget. There was no indication whatsoever that their funding would be cut.

There is a structure in place so that when political parties contest elections they have a clear indication of the state of the budget. So this idea that, after you come into parliament, you suddenly have no idea what the state of the budget is—and that that justifies you making all of these fundamental changes—is just complete rubbish. The state of the budget was absolutely known by the coalition before the election. Yet they made no mention of these really quite profound changes that are going to affect communities in Western Australia across the board—and which will have a particularly significant impact on small rural communities.

There are a number of communities that are dependent on these Financial Assistance Grants for 30 per cent or more of their local government income. These include Derby-West Kimberley, Dalwallinju, Karijini and Upper Gascoyne. Then there are places like Mount Marshall, Mukinbudin, Murchison and Koorda, all of which are dependent on Financial Assistance Grants for 50 per cent or more of their income. These grants play a very significant role in these communities. Quite understandably, then, the shires in these regional areas are immensely concerned about what has happened. Greg Powell, the CEO of the Shire of Merredin, had this to say:

Rural and remote communities are, in many cases, already struggling with declining populations, drought and other detrimental socio-economic factors. Placing the expectation on the local community to either cover the shortfall in funds or accept a decline in services is grossly unfair given that our local residents have already paid taxes to the Federal Government and expect an adequate level of that revenue to be returned to Councils to provide local services and infrastructure …

Mr Webster, the CEO of the Shire of Wagin, has said:

A decision like what has occurred will either increase shire rates & charges or reduce the services to the communities. It will also have a long term impact on programs that local government often undertake from these funds for their communities.

The impact is not confined only to those rural areas. It will also affect shires like Swan and Bayswater in my electorate. Francesca Lefante, who is the CEO of the City of Bayswater, had this to say:

The failure to index the FAGs will mean the City of Bayswater’s ability to provide services, such as libraries and family-oriented community facilities, will be put under great pressure as we struggle to meet the needs of a growing and ageing population. This is a blow for local communities already bearing the brunt of greatly increased charges for utilities and cuts to services in the areas of health, education and seniors’ concessions.

We have heard some interesting commentary today. The previous speaker, the member for Herbert—who at least did speak about local government and not about ties and live exports—even contested whether or not these Financial Assistance Grants were something that should be provided by the federal government. Financial Assistance Grants were first introduced in the mid-1970s by the Whitlam government. This was the first time the Commonwealth had ever directly recognised local government. The formula was then reset by the Keating government in the mid-1990s. The grants are a very clear recognition that the majority of taxation accrues to the federal government and that there must be a fair sharing of this revenue. The suggestion from the member for Herbert that the government may be looking at walking away from this is remarkable. (Time expired)

See this speech in context