Local government peaks welcome ongoing funding for key roads, bridges and regions programs but say inaction on financial grants means councils face a shortfall.

Councils have welcomed Budget 2018-19’s continuation of funding for schemes such as Roads to Recovery, Bridges Renewal Program and Black Spot Program but say it should have addressed the inadequacy of the financial assistance grants, which is contributing to crippling local infrastructure backlogs.

Local government peaks are disappointed the Federal Government ignored their calls to boost financial assistance grants to 1 per cent of Commonwealth tax revenue.

Last year’s budget restored indexation to the grants but councils are still dealing with a shortfall caused by the three-year freeze on base payments.

That freeze is equal to a permanent reduction in the funding base of 13 per cent, according to the peaks, which impacts provision of community infrastructure and services such as libraries, pools and early childhood centres.

However, last night’s budget did include an early payment of 50 per cent of the 2018–19 financial assistance grant, providing a “cash injection of more than $1.2 billion” to give councils the opportunity to start work immediately on new projects.

The budget contained $29.7 million for local community infrastructure, but it did not deliver on local government’s call for a four-year $300 million a-year community infrastructure program.

Australian Local Government Association president David O’Loughlin said while the budget had a strong focus on upgrading key freight routes it was silent on the “first and last mile connectivity issues.”

“We know almost every freight journey starts and ends on a road built, owned and maintained by local government and with the freight task set to double by 2020, the nation can’t afford to have a substandard local road network and we can’t afford to upgrade it on our own,” Mayor O’Loughlin said.

Local roads: $1.2 billion shortfall

Acknowledging the budget returned funding for the Roads to Recovery program to pre 2015-16 levels, Local Government NSW president Linda Scott said research had shown that councils nationally would face an annual shortfall of $1.2 billion if government simply maintained local roads to 2025.

“Continued under investment in local roads acts as a brake on the economy, hindering not only local and regional social and economic development but the development and productivity of the nation,” Cr Scott said.

Similarly, South Australian local government peak president Lorraine Rosenberg said councils in her state were left with a “$20 million question mark hanging over their future roads budgets” with additional funding from last year’s budget soon due to expire.

“A key focus for the LGA this year will be advocating to all South Australian federal MPs to support the continuation of supplementary road funding for SA in 2019-20,” Mayor Rosenberg said.