Byron Shire Council is urging the Australian Government to take meaningful action on Federal Assistance Grants, advocating for an increase from the current 0.5 per cent of tax revenue to 1 per cent. 

The call comes at a critical time, as local communities across the country are grappling with the ongoing housing crisis and its aftermath.

“Local governments are facing increasing pressures to provide more services while managing growing infrastructure demands, and making proper investment in local councils is essential for improving the quality of life for everyone, no matter who they are,” Byron Shire Mayor Sarah Ndiaye said.

The proportion of national taxes allocated to local government has shrunk over time, according to an SGS Report (2024) into Long-term trends in Australian Local Government Financial Sustainability.

“Financial Assistance Grants represented 0.83 per cent of Commonwealth tax revenue in 2000.  They declined to 0.62 per cent by 2008 and have dropped down to a meagre 0.5 over the past 5 years,” the Mayor said.

“It’s a disgrace that successive Australian Governments have allowed the Federal Assistance Grants — the only untied source of annual funding for local governments — to flatline at such an embarrassingly low level for so long, while per capita expenditure from both State and Commonwealth governments has soared,” she said.

“It’s outrageous that in the lead up to the election, neither of the major parties are talking about the very thing that would have the most meaningful impact on people’s quality of life on a daily basis.”

The Mayor’s comments follow insights gained at the recent Country Mayors Association NSW conference and a report from the NSW Auditor General reiterating this ongoing challenge. 

She is calling on other councils across the nation to join her in highlighting the unfair imbalance in funding that forces local governments to beg for grants and funding every election cycle just to maintain basic amenities and infrastructure. 

“Local governments are now expected to manage more services than ever before, from roads and rubbish to libraries, parks, childcare, and even airports, cemeteries, and some health services. 

“We are the safety net for our communities and the services of last resort for the most vulnerable,” Mayor Ndiaye said.

“Local governments employ over 200,000 people across more than 400 occupations, and we manage assets worth $640 billion with an annual operating spend of $38 billion. We’re responsible for managing one-third of Australia’s public infrastructure and 77 per cent of the national road network."

In addition to these existing challenges, local governments are now being burdened with the increased demand for services due to the impact of climate change, particularly in areas like Northern Rivers, where climate disasters are becoming more frequent.

“The Federal Assistance Grants, first introduced by the Whitlam government in 1974, were designed to help local governments fund essential services. However, at 0.5 per cent, the current level is simply not sustainable for us to continue delivering the services and infrastructure our communities rely on,” Mayor Ndiaye emphasised.

“It’s time for the Australian Government to ‘get real’, stop tinkering around the edges trying to lure votes with sugar hits and make meaningful change. We need serious investment in local government — a move that will ultimately improve the quality of life for all Australians.”