Opening Address: Australian Local Government Association—2015 National General Assembly



15 June 2015

National Convention Centre, Canberra

Thank you Troy (Pickard, Chair ALGA), for the kind welcome.

Members of the ALGA Board, Mayors, Councillors, ladies and gentlemen it is a great pleasure to officially open the 2015 ALGA National General Assembly. The Prime Minister sends his regrets that he is unable to be here, as well as his best wishes for a constructive three days.

Before I continue, I was saddened to learn of the sudden passing of Mayor Barry Jarvis and I would like to pay my respects to his family, friends and colleagues. Mayor Jarvis was a proud advocate for local governments in Tasmania and actively served his community with distinction. I was pleased to meet with Mayor Jervis on a number of occasions and I look forward to continuing Mayor Jarvis' work with the Local Government Association of Tasmania in the future.

May I just say, it's a pleasure to be here today—as a former Mayor I appreciate the opportunity to meet with you, listen to your concerns and work together to build a stronger Australia, from the local level up. In the last 12 months alone, I or my Office have met with well over 100 councils from across the country to discuss local issues affecting local communities.

Which brings me to the theme of your conference this year: 'Closest to the Community: Local Government in the Federation'. I am sure that over the next three days there will be robust discussion as you take the opportunity as a sector to think ‘big picture’ about the role and future of local government in the Federation.

There is an now unprecedented opportunity for us to rethink the way we as governments do business and serve our communities. The Government is providing the forum to discuss change through our White Papers on the Reform of the Federation and Taxation.

Our Federation has served our national well for over 100 years and shown some flexibility to deal with issues of concern over the years. But the balance of constitutional responsibility and revenue raising capability has becoming increasingly grotesque.

It would be better if States (and Local Government) did not have to keep demanding more money from the Commonwealth for services they have the constitutional responsibility to deliver. Reforming the Federation is vital if we are to deliver our publicly funded services to the Australian people more effectively, more efficiently and more fairly. Tomorrow you will have the opportunity to learn more on the subject from Dr John Bannon AO who is on the Prime Minister's Expert Advisory Panel for the Federation White Paper. Troy and ALGA have been active participants in the Reform of the Federation White Paper process, serving on the Steering Committee and contributing to the Federation Reform Roundtable discussions, along with local government representatives from across the country.

A Green Paper setting out options for reform will be released later this year, and I encourage you to provide written submissions on the proposals put forward. This is a once in a generation opportunity for Local Government to secure its role in the governance of our nation—so use it well.

The White Paper on the Reform of the Federation will be delivered in the first half of 2016.

However, reforms to the Federation and the division of spending responsibilities are unlikely to be effective unless we also consider how they are funded. That is why a Taxation White Paper process is occurring in tandem with proposals for reforms to the Federation. The Government launched the Tax discussion paper on 30 March 2015. The formal submissions process for the discussion paper closed on 1 June 2015—I hope you have all lodged your submissions.

The next step will be the release of an options paper in the second half of 2015, which will undergo further community consultation ahead of the release of the final White Paper.

The Prime Minister has described the parallel processes of the Federation and Tax white papers as a 'once-in-a-generation opportunity'. I know that there is some anxiety amongst local governments about this process—let me say again, my advice is to get involved.  Actively engage in the process and shape what comes out of it.

Make no mistake—this Coalition Government is committed to local government—but you must also make a constructive contribution for yourselves, not just about what you want from other tiers of government, but also what you can contribute as partners in the task of government in this country.

The 2015–16 Budget demonstrates this Government's continued commitment to working with councils right across Australia to deliver the infrastructure and services you require for more prosperous communities. I know the decision to temporarily pause the Financial Assistance Grant indexation was an unpopular one—I can assure you from our end it was not one we wanted to make. The Coalition when elected inherited $123 billion of cumulative deficits. We've got that down by about $40 billion and under the circumstances that's the responsible thing to do. The indexation pause has contributed to the important task of budget repair—but we have a long way to go.  It is for this reason the Government is committed to the temporary pause of indexation. The pause is temporary, and Councils will still receive $9.45 billion across the forward estimates.

It is worth noting that when looking at accumulated tax revenue across all levels of government, local government's proportion of total tax revenue has been steadily increasing over the last six years. This Government's main focus in on growing the funding pie which is why we are investing, at unprecedented levels, in productive infrastructure that generates economic returns and returns dividends to individuals, families, businesses, industries and governments.

Our economic plan is to create jobs and stimulate growth across all of Australia. Our plan includes reducing business costs, opening opportunities through free trade agreements, cutting taxes and building vital infrastructure—at a national and local level. In the last 12 months, despite the Government's Budget repair task, local governments have benefited from over $1 billion in extra funding in expanded and new programmes.

The Coalition Government has delivered on its commitment to double Roads to Recovery funding under the $2.1 billion programme in 2015–16. This coming financial year alone Councils will receive $700 million in Roads to Recovery funding. Further, under the new Roads to Recovery legislation that the Coalition Government introduced there is no sunset clause for the Roads to Recovery programme—it is permanent. This is the same legislation that Labor and the Greens voted against in the House of Representatives—delaying last year's payments.

The expanded Black Spot and Heavy Vehicle Safety and Productivity Programmes will deliver an additional $400 million over two years from 2015–16—much of it to Local Government. In addition to these expanded programmes the Government has delivered a number of new initiates including the National Stronger Regions Fund and the Bridges Renewal Programme. For National Stronger Regions we received 405 applications that were seeking total funding of over $1.2 billion.  51 projects across the nation received funding totalling $212.2 million—many were Council projects. The Bridges Renewal Programme received 216 eligible proposals from local government seeking $128 million. The result was that 58 of these projects totalling $39 million in funding were approved.

With so many Councils present this morning, I would like to take the opportunity to provide broad feedback on first round applications for both programmes. For both programmes, it was the more strategic or ‘big picture’ proposals that were successful. These applications contained good strong evidence of the project's economic benefits and the disadvantages being addressed, as well as the productivity gains and broader community benefits the project would bring. Applicants who were unsuccessful in the first round had several avenues to get feedback. I hope many of you took advantage of this opportunity—including yesterday's briefing sessions. Writing winning applications for the money on offer may not be easy. Your Regional Development Australia Committees are an excellent resource. I encourage you to seek their assistance in developing applications for subsequent funding rounds.

The Government is committed to making sure these funding opportunities hit the ground where they are most needed.  We are adjusting criteria for future rounds of these programmes to help ensure the projects chosen are best able to achieve the intended objectives of the fund.

I am very pleased to be able to use the opportunity of the National General Assembly to announce the opening of Round Two of the Bridges Renewal Programme. Our experience with the first round showed that State Government projects were better able to meet the criteria for the programme. Their projects generally could demonstrate the bigger traffic counts and therefore stronger economic benefits. Last mile local projects could not be competitive. Therefore, this $100 million second round of the Bridges Renewal Programme will be exclusively available to local government. Bridges Renewal Round Two will open on July 1 and close on August 31. I encourage councils to work with their RDA committees and state road agencies in developing their proposals and to consider how their project will complement their RDA regional plan.

It is important that the investment of both the Government and local government is directed to those projects with the greatest potential in terms of productivity and community benefits.

Round Two of the National Stronger Regions Fund opened on 15 May and closes on 31 July 2015. This programme was established to promote economic development in Australia's regions, with a particular focus on assisting disadvantaged regions to achieve growth.

It presents a key opportunity for local councils in areas suffering disadvantage to realise a project that will make real difference to their community.

I want to emphasise that this program is designed to assist disadvantaged communities on low average incomes, high unemployment, low socio-economic circumstances, or particular local disadvantage—by helping to fund projects that will specifically address the disadvantages. It is an economic programme, not a social programme.

Some minor amendments have been made to the guidelines to better reflect the objectives of supporting economic growth and sustainability of regions, particularly disadvantaged regions.

We have made it easier for local government to participate by:

  • quarantining $25 million for projects worth less than $1 million to give the programme broader reach; and
  • applicants can submit two applications per round.

One year after we announced a record $50 billion investment in infrastructure, bulldozers are moving earth and cranes are dotting skylines. We are getting on with the job of delivering an infrastructure package that is improving road and freight rail links in every state and territory—projects in the biggest cities and small local communities. Our investment is boosting our economy by creating tens of thousands of jobs, increasing capacity on our freight routes, and importantly, reducing congestion and improving safety for all road users.

We are breaking new ground on major projects around the country—including the Gateway upgrade in Brisbane, the Toowoomba Range Crossing, WestConnex and NorthConnex in Sydney, the Perth Freight Link in Western Australia and the South Road Upgrade in Adelaide. We have started work on a $3.6 billion upgrade of the roads in Western Sydney, one of Australia's fastest growing region. This year's budget includes all the money that will be required to complete the four-laning of the Pacific Highway, which we are on schedule to complete by the end of this decade. Those travelling the Bruce Highway will pass by dozens of projects which are part of our $8.5 billion 80/20 partnership with Queensland to bring the state's major north-south  highway up to standard.

Despite what you may hear from our critics about the Government's commitment to freight and urban rail, $3.4 billion is committed in the budget for investment on freight rail, intermodal and urban passenger rail projects to 2018–19. This includes $1.6 billion towards freight and intermodal projects in New South Wales, South Australia and Tasmania and preconstruction activities to help get our nation's most important freight rail project—the Melbourne to Brisbane Inland Rail—underway.

And there is nearly $1.8 billion to continue urban passenger rail projects in Victoria and Queensland. This is in addition to the urban rail projects to be supported through our $5 billion Asset Recycling Fund which is dedicated to providing incentives to invest in new productivity enhancing infrastructure. The fund encourages states and territories to recycle existing, mature infrastructure assets, providing the private sector including the super funds an opportunity to invest in brown field infrastructure with confidence, or to partner with governments to deliver new projects.

The complementary use of alternative financing options for new projects being funded under the Asset Recycling Fund will help address impediments to private sector investment, reduce the upfront call on government resources and maximise the returns. The ACT and NSW Governments have signed asset recycling agreements, with proceeds being used to fund public transport projects such as the Capital Metro light rail project in Canberra; and the Sydney Rapid Transit and Parramatta Light Rail. Discussions are being progressed with most other states and territories about accessing this programme.

The 2015–16 Budget is investing heavily in the regions with a range of new programmes and initiatives that build on the Coalition Government's existing commitment to supporting long-term growth and resilience in regional and rural communities.

This Government is—and always has been—a champion for small business because their innovation, investment and enterprise are key drivers of productivity. Small business powers local employment and regional economies. A new $5.5 billion Jobs and Small Business Package will assist new small businesses to invest, grow and create new jobs. A $4.4 billion Families Package will ensure that families are able to access affordable and flexible child care.

We are pleased also to introduce the new Stronger Communities Programme. For two years $150,000 in Australian Government funding will be available in each of our 150 federal electorates for small capital projects. Grants between $1,000 and $20,000 will be available to local governments and community based not-for-profit organisations. Local MPs will be responsible for consulting with communities to identify high priority projects that will deliver social benefits including community participation and social cohesion. More information about this programme will be available soon.

Realising the potential of northern Australia remains a key Government commitment.  Very soon we will be announcing our White Paper on Northern Australia which will represent the most ambitious plan ever to develop the opportunities of the north. The $5 billion finance facility announced in the budget demonstrates something of the scale of what we have in mind.

The new $100 million Northern Australia Beef Roads Fund will make targeted upgrades to key roads necessary for transporting cattle. The Fund will improve the productivity and resilience of cattle supply chains in northern Australia and underpins the future viability of the cattle industry which has long been a pillar of the northern economy. Importantly, it will draw on CSIRO modelling of the cattle supply chain to identify which road improvements will make the biggest financial impact.  The initiative will commence in July 2015 and run until in June 2019.

In addition to new Budget funding, the White Paper on Developing Northern Australia is bringing all the threads for a future northern Australia together. It will focus on transport infrastructure, developing water resources, attracting more investment and reducing red tape. It will be a plan not just for the immediate future, but for decades to come.

This Government's commitment to local government is real demonstrated by the programmes I've just outlined:

  • $9.45 billion in Financial Assistance Grants;
  • $2.1 billion Roads to Recovery Programme;
  • $1 billion National Stronger Regions Fund;
  • $300 million Bridges Renewal Programme;
  • Additional $200 million each for the Black Spot and Heavy Vehicle and Safety & Productivity Programmes;
  • $100 million for beef roads; and
  • $45 million under the Stronger Communities Fund.

We maintain our commitment to all Australians, wherever they live.

Last month the Prime Minister released Australia's first National Infrastructure Audit, undertaken by Infrastructure Australia. The audit provides an overview of the challenges and opportunities that exist for Australia's infrastructure planning and development. It highlights the growing congestion in our major cities and its impact on our productivity and liveability and the challenge for our transport infrastructure to cope with future demand. In 2011 the cost of traffic delays on roads in the six largest capital cities was $13.7 billion. Infrastructure Australia projects this figure to grow by around 290 per cent to $53.3 billion in 2031 if we don't take action. Therefore ensuring we are managing the infrastructure we already have in the best possible way, and being creative and innovative in planning and paying for future infrastructure with greater involvement by the private sector are crucial.

Local Government has a big role to play in driving and facilitating the continued growth in our economy through their approach to land use planning and corridor preservation. Councils have a history of managing their community plans well.  But we can all be smarter about how we plan for our long term infrastructure needs.  Council plans will be far more effective if there is a coordinated effort that includes the state and territory government level, so there is an awareness of your local issues and agendas at that level. They are after all your immediate partner. “Closest to the Community”—you must think strategically about how your planning and your budget can be most effective. It is only when we collaborate and think beyond boundaries that we can achieve the best outcomes for the communities that we collectively serve.

Thank you again for the opportunity to open the ALGA 2015 National General Assembly. For 175 years local governments have played a vital role in the life of our nation. What started as Adelaide Corporation in 1840 to enable colonial governments to deliver local services, particularly building and maintaining roads, has grown to 560 local councils continuing to maintain roads in addition to managing social, cultural, economic and environmental issues.

Local government is a valued partner in the Government's drive to achieve greater productivity and economic strength across the nation and for the benefits to be realised at the community level. I congratulate Troy and his team on the wide-ranging agenda set for this year's National General Assembly and on the selection of such high calibre speakers. I look forward to seeing many of you tomorrow evening when I have the privilege of announcing the winner of the National Award for Excellence in Local Government.

I declare the 2015 National General Assembly officially open.

Thank you.