By Julian Bajkowski and Paul Hemsley

Australia’s 565 councils and shires have been handed their third federal minister for Local Government in as many months on the back of an inevitable reshuffle following the second incarnation of Kevin Rudd as Prime Minister.

Member for Ballarat, Catherine King has been elevated into Cabinet under a simplified portfolio of Minister for Regional Australia, Local Government and Territories after being promoted from the cross-portfolio outer ministries of Regional Services, Local Communities and Territories which were lumped together with her duties as Minister for Road Safety.

(Click here for the full Rudd Ministry)

Ms King, reportedly previously a Gillard supporter, replaces now Deputy Prime Minister Anthony Albanese who has added the challenging and complex portfolio of Broadband, Communications and the Digital Economy to his existing role as Transport and Infrastructure minister as well as being the Leader of the House.

Mr Albanese most recently took on the Regional Development and Local Government portfolio after veteran Labor minister Simon Crean quit the post for the backbench after he instigated an abortive and damaging spill that failed to produce a leadership challenge.

Although not fortuitous for Mr Crean – who has announced his retirement from Parliament – the Labor elder’s removal from the front bench acted to propel Ms King to a full minister after serving in Parliamentary Secretary roles.

With only a short time until the election, Ms King’s has taken over ministerial duties at a highly volatile period in local government as councils across Australia anxiously attempt to keep the prospect of referendum on financial recognition in the Constitution alive without certainty of an election date.

The fortunes of the referendum being held at are directly dependent on the naming of the date because of the relatively small window of time allowed for in enabling legislation for the poll – with an early election almost certainly ending any prospect of a popular vote on direct funding for councils.

"Our advice has been that a referendum would have to be held no sooner than two months after the passing of the Constitution Alteration Bill in the Senate and no later than six months,” said Australian Local Government Association (ALGA) president Felicity-ann Lewis.

However just a week prior to resuming Prime Ministerial duties, Mr Rudd told Government News through a spokesman that the then back-bencher “supports the government’s work to bring this [the referendum] to the Australian people”.

The spokesperson said “Mr Rudd is proud of the increased engagement with local government that has occurred under this government including vital partnerships to build community infrastructure and save jobs during the Global Financial Crisis.”

So far ALGA has welcomed Mr Rudd's “acknowledgment that the referendum for Constitutional recognition of local government will be one of the main factors considered in any decision regarding the date of the 2013 federal election.”

But the other “main factor” that is more likely to ultimately influence the poll date is which day the government reckons will maximise its electoral chances, regardless of the referendum.

The question that councils and shires are now necessarily asking is how long they will have to wait to find out whether or not they can start spending $10 million in federal money freed-up for the ‘vote yes’ campaign along with a matching amount in the form of a campaign war chest mustered by ALGA.

“The timeframe for passing the referendum legislation was very tight to allow the Government to meet the 14 September election date and moving the date forward may create administrative problems around the referendum date which cannot be resolved," ALGA President Felicity-ann Lewis said.

"Australians should have the right to vote at a referendum to include local government in the Constitution and ensure the continuation of direct, federal funding for community infrastructure and services.

But many of those in the Liberal Party beg to differ after they staged a Senate mini-rebellion and walkout that not only broke with the Coalition’s stated position of support for the referendum, but prompted Opposition Leader Tony Abbott to concede that no action would be taken against objectors.

On the night of the leadership change former Howard Government Industrial Relations minister Peter Reith took to Twitter to pan the referendum’s chances of being held.

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