Queensland councils back funding inquiry
Published on 10 November 2025
Queensland councils back funding inquiry - but the clock is ticking for reform
The peak body for Queensland councils has welcomed a re-instated Federal Parliamentary inquiry into local government financial sustainability but has urged the Commonwealth to commit to a June 2026 deadline for its final report and recommendations.
Local Government Association of Queensland (LGAQ) President Matt Burnett said the Inquiry into Local Government Funding and Fiscal Sustainability must deliver real reform that restores fair, untied funding to councils.
“The current funding model is broken. Councils across Queensland are doing everything they can to maintain community liveability, deliver essential services, and fill gaps left by other levels of government and the private sector - but many are now stretched to breaking point.”
The new Inquiry replaces the previous Inquiry into Local Government sustainability which expired at the end of the last term before delivering any findings.
LGAQ Chief Executive Officer (CEO) Alison Smith said it was imperative the new Inquiry had a firm reporting date of June 2026 to ensure it could deliver its recommendations and make appropriate budgetary provisions before the next Federal Election, so that councils were not left hanging for yet another term.
Ms Smith said councils were operating in an environment of growing expectations, rising costs and federal funding that has flatlined.
“Councils were promised fairer funding by the Federal Government in 2022, yet the percentage of taxation revenue, supplied to councils as untied funding, has continued to go backwards,” Ms Smith said.
“At the same time, cost-shifting from other levels of government has ballooned to more than $360 million annually in Queensland alone. This is unsustainable.”
The LGAQ will urge the committee overseeing the Inquiry to recommend restoring at least one per cent of Commonwealth taxation revenue back to local governments through Financial Assistance Grants, indexed annually to provide certainty and sustainability.
This and seven other recommendations were made to the previous and unresolved Inquiry in a submission the LGAQ provided in March 2024, including that the Federal Government establish a new allocative, permanent funding program for local governments to build and maintain essential community infrastructure, following the cessation of the Local Roads and Community Infrastructure Program on 30 June 2026.
“Every dollar of untied funding helps councils invest in what their communities need most, whether that’s local roads, parks, childcare centres, or resilience measures. It’s the most effective way to deliver national outcomes locally,” Ms Smith said.
“A fairer funding deal for councils means more liveable communities in every corner of Queensland and across the nation.
“It means regional and rural towns don’t fade out of existence. It means cities can grow sustainably and affordably. It means First Nations communities can preserve their cultural heritage and determine their own future.
“As Australia’s most decentralised state, Queensland’s councils are the most diverse in the nation from the largest in area and budget to the smallest and most remote.
“No matter where you live, community liveability is critical, and councils are at the heart of delivering that.
“But councils can’t do it alone. Each level of government has an important role to play, and the system only works when it’s in balance.”
The LGAQ will be consulting with member councils to provide updated data to the committee as part of the Inquiry process, including initial results from the LGAQ’s 2025 Cost Shifting Survey. The LGAQ would welcome the opportunity to appear before the Committee on behalf of Queensland councils and strongly urges the Committee to hear directly from as many Queensland councils as possible.
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