Councils under funding pressure

Published on 07 July 2025

Local government sustainability is well and truly in the spotlight this week with the North Burnett Regional Council making the difficult but necessary decision to adopt a bottom-line rates increase of 22 per cent.

“We have been telling Federal and State governments for a number of years that the increasing pressure on councils to maintain services to their communities while they struggle to generate sufficient revenue of their own from cash-strapped communities is not a sustainable and viable model - and the North Burnett Regional Council’s decision brings that into sharp focus,” Local Government Association of Queensland (LGAQ) Chief Executive Officer Alison Smith said.

“In city halls and shire chambers across Queensland, councils are fighting an almost impossible battle to make sure their communities have the critical services and facilities they deserve while keeping rates and charges as low as possible.

“But while rivers of gold flow to the Commonwealth when we all pay everything from income tax to fuel excise to the GST, the level of government that provides most of the things communities use most often – your council – gets the least.

“Councils receive just three cents in every dollar of taxation revenue, compared to 80 cents in the dollar for the Commonwealth and roughly 17 cents for the State Government.

“At the same time, councils are having to do so much more with less or their communities miss out.

“Many are caught in the vice between rising costs in areas like construction, labour, materials, State Government imposts like the bin tax and the flatlining of Federal Financial Assistance Grants.

“While the Commonwealth takes the cream of taxation for high-profile, big ticket items, councils are left with the crumbs to battle to provide the on-the-ground, day-to-day services and infrastructure communities rely on to be liveable.

“It means some councils are facing tough choices like reducing services or raising rates and charges just to keep providing the core services their communities need and deserve.

“Our research also shows that councils are having to fill a $360 million blackhole every year from cost-shifting where local government is having to step in as the provider of last resort for facilities and services that are the realm and responsibility of the Federal and State governments or the private sector.

“Councils everywhere are having to step in and provide critical services beyond their core responsibilities because communities need them but the other levels of government and private sector have either pulled out or pulled back.

“Our research found this can be anything from councils running the local childcare so they can still attract a workforce by supporting families in the community, paying for rebroadcasting so residents can access free-to-air TV and radio, purchasing buildings so there is a home for critical health services, providing undertaking and morgue services, housing, to running the post office, the service station, the bakery - because if councils don’t do it their communities will go without.

“But councils have reached a tipping point.

“Communities and councils deserve their fair share and that’s why our advocacy for fairer funding is so important.

“Only through fair funding to councils will Queensland communities secure the liveability they all deserve.”