Funding for local government welcomed but long-term certainty needed

The peak body representing Queensland councils has welcomed funding commitments to support increased housing investment and regional development in the Federal Budget but says ongoing funding shortfalls threaten every day council services. 

Local Government Association of Queensland (LGAQ) President Mayor Matt Burnett welcomed a $2 billion boost for housing-related trunk infrastructure as well as additional funding to continue programs such as Growing Regions and Thriving Suburbs, among measures announced in the Budget. 

The earlier announcement that councils can expect to receive 80 per cent of their 2026/27 Financial Assistance Grant payment this financial year will also provide much needed certainty. 

But Mayor Burnett said councils still needed a fairer share of funding to support their day-to-day operations. 

“Councils need a permanent one per cent share of Commonwealth revenue to ensure their ongoing financial viability,” Mayor Burnett said. 

“Without this commitment from the Federal Government, councils will continue to struggle through uncertainty from year to year. 

“It’s great to see increased funding for housing enabling infrastructure, however the phasing out of the Local Roads and Community Infrastructure Program (LRCIP) will hit councils hard. 

“And while continued investment in active transport and regional development are welcome, they don’t deliver the baseline funding councils need to keep delivering essential every day services.” 

Mayor Burnett said the Federal Budget had also missed another opportunity to deliver increased investment in First Nations housing to address overcrowding. 

“Since the National Partnership Agreement on Remote Indigenous Housing ended in 2018, overcrowding in many of Queensland’s First Nations communities has worsened,” he said. 

“In the years since, First Nations councils and the LGAQ have repeatedly called for urgent investment to improve liveability in these communities.” 

LGAQ CEO Alison Smith said councils are delivering an ever-growing range of services with just three per cent of Australia’s overall taxes, highlighting the urgent need for more federal funding. 

“It is disappointing to see that councils and their local communities are continuing to see the local government core funding program, Financial Assistance Grants, decline as a percentage of total taxation revenue, slipping to 0.49 per cent,” Ms Smith said. 

“Running post offices, aged care, re-broadcasting free-to-air television and even operating morgues are just some of the services councils perform on behalf of other levels of government. 

“Our research shows this cost-shifting is forcing councils to cover a $360 million black hole every single year, up 378 percent in two decades. 

“While councils are being asked to do more with less, it makes no sense to continue reducing the share of taxation revenue being returned to local communities through Financial Assistance Grants or to end crucial funding initiatives such as the LRCIP, which supports local jobs and economies. 

“The LRCIP is estimated to have injected $668 million into the Queensland economy and supported almost 4000 fulltime equivalent jobs across the state, including almost 1300 direct jobs.   

“And when it comes to roads, no one knows the local road networks like councils and the Federal Government should be heeding their calls for more funding.” 

The LGAQ will be in Canberra next month with Queensland councils for the National General Assembly and will use that opportunity to keep campaigning for fairer local government funding.

For more information, please contact:

Martin Philip, Media Advisor
Phone: 07 3155 4003
Local Government Association of Queensland