A national and international review of potential alternative income streams for financially strapped rural communities has found that there is no “silver bullet” that can boost council incomes.
“The truth globally is that to ensure equitable access to the services small communities need and deserve, state and federal governments need to step up,” Rural Councils Victoria Chair Cr Mary-Ann Brown said.
The report – Alternative Sources of Income for Local Government – found no single idea or even group of ideas from across Australia or overseas can generate significant alternative revenue for small councils representing small communities.
The report – by SGS Economics and Planning was commissioned by Rural Councils Victoria. It examined options across Australia and similar jurisdictions, including the UK, Canada and New Zealand.
Internationally only two councils, one in Canada (City of Saint John) and one in NZ (Hauraki District Council) managed to raise more than 5 per cent of income from “other” (non-rates, non-fines, non-government) sources.
Rural Councils Victoria Chair Cr Mary-Ann Brown said:
“This report highlights that while some opportunities for raising additional revenue exist, these are extremely limited, require levels of resourcing beyond the capacity of many rural councils, and will not resolve broader structural funding challenges.
“The report found that the majority of local governments across the UK, Canada and New Zealand also have low levels of ‘other’ income sources and maintain reliance on funding from government grants.
“The report makes it abundantly clear that state and federal governments need to do more to support small rural councils, which have smaller populations, low rates bases and huge geographic areas to service.
“Unlike metropolitan councils and regional cities, the report points out that rural councils don’t have the traffic volumes to raise funds through parking fees and fines or the population density to sustain small enterprises.
“In an era of surging inflation and natural disasters, small rural communities urgently need additional resources for roads, aged care, childcare, libraries and other community services.
“The report underscores the need to review the minimum general purpose grant allocation from government, to ensure that the resources go to the communities that need it most.”
“We are currently bringing the report and its findings to the attention of state and federal governments.”
“We will advocate for more government funding to support rural communities as a matter of urgency,” Cr Brown said.
“State and federal Governments must review the improvement program outlined in KPMG’s 2017 Report of the Rural and Regional Councils Sustainability Reform Program to inform future projects and programs to address improved equity across all councils in Victoria.
“One of the key recommendations of the KPMG report (recommendation 56) was that governments support the long-term sustainability of rural and regional councils through dedicated programs of support.
“In its response to the KPMG report, the Victorian Government said it supports the long-term sustainability of rural and regional councils through dedicated programs of support.”
“Rural communities need urgent action that back up this promise,” Cr Brown said.
