News and resources

Issue 38 December 2014

MAV President's Update - occasional report from Cr Bill McArthur, President of the MAV

Issue 38, December 2014

As the year draws to a close, I’d like to reflect on some of the challenges faced by local government in 2014, and how the MAV and our members have worked together to achieve some positive results for councils and Victorian communities.

A tight fiscal environment saw the introduction of program cuts and cost saving measures, combined with new revenue streams in both State and Federal Budgets this year. In particular, the loss of indexation for Federal Financial Assistance Grants was condemned by the MAV and councils.

However, sector advocacy still managed to secure a range of funding wins to benefit councils, and also provide more affordable outcomes for ratepayers and families. The Commonwealth Government agreed to continue funding its additional five hours of preschool in 2015, ensuring the continuation of affordable kindergarten programs for around 73,000 Victorian children next year. The new State Government also committed $50 million in capital funding for kindergartens, a good start towards better sharing the costs to maintain and build facilities to cope with increasing demand from our growing population.

Councils also received a further $5 million this year to cover the costs of collecting the State’s fire services property levy. MAV negotiations with Treasury ensured this annual funding will be indexed until a review occurs in 2017/18. A further $9.2 million was provided to renew the Rural Council Planning Flying Squad to assist rural councils to undertake planning work, and 64 councils will continue to have a resource to assist with better preparing our communities for emergencies, with advocacy securing a $9.1 million two-year extension to the Municipal Emergency Resourcing Program.

The MAV has recently been funded to continue our Prevention of Violence Against Women work with councils for a further two years, and $2 million in State funding is helping to improve maternal and child health data through our MCH IT project with 65 councils in response to concerns raised in an Auditor General’s report.

The recent state election was a strong focus of our advocacy efforts this year and our Call to Parties set out local government’s priorities to deliver stronger partnerships and engagement, and provide improved services and infrastructure for Victorian communities. We are continuing our work towards securing these outcomes with the new government, including meetings and briefings with new Ministers.

The sector united in calling for ongoing State investment in local infrastructure, and the new Victorian Government has committed $2 billion for country and suburban roads, and a $250 million Regional Infrastructure Development Fund including dedicated funds for the 10 regional cities and 38 rural shires. They have also pledged $100 million to upgrade community sports clubs; a $100 million Safer Cyclists and Pedestrian Fund; and $100 million for bus networks.

These are all positives for our communities and we’ll be seeking further details on the operation of these programs from relevant Ministers. On the flipside, Labor’s plan to bring in rate capping for rises above CPI is unanimously opposed by local government. As stated in my last President’s Update, our Finance and Rate Capping Taskforce is guiding the MAV’s advocacy work on this matter and we will be working constructively with the new Minister and within the broad framework proposed to advocate for councils’ continued discretion in setting their own revenue strategies.

Time and cost savings have also been delivered to councils through our collaborative procurement work, with councils participated in nine procurement tenders more than 400 times during the year. We were pleased to receive a section 186 Ministerial approval, which means that all councils are now able to access our procurement contracts irrespective of whether a council approved us as a tendering agent.

Our Local Government Funding Vehicle (LGFV) launched Australia’s first municipal bonds program last month, with 30 councils accessing cheaper borrowing rates than offered by major Australian banks. This ongoing facility provides a new means of accessing cheaper sources of funding for all Victorian councils by utilising economies of scale to issue municipal bonds on a regular basis.

Seventy-seven councils also accessed our Microsoft Licensing Software contract, and $2 million was saved by 70 councils through a collaborative VMWare Licensing contract. It has been particularly rewarding to see 55 councils participate in our energy efficient street lighting program, which will save councils and communities $451 million over the life of the new lights and reduce greenhouse gas emissions by 1.56 million tonnes.

We have summarised some of our work and achievements for the year into an infographic for members. Your support and collaboration have been greatly appreciated throughout this year.

Next year I expect will be a critical period for securing long-term financial sustainability for local government. There is a strong reform agenda, with a particular focus on a smaller footprint for the federal government, and reducing duplication and overlap of service delivery roles. We’ll be working closely with the ALGA to be influential participants in the Federation Review process, and a national campaign will be launched to seek restoration of indexation to Financial Assistance Grants.

At the state level, we’ll also be seeking an assurance that the new Premier and Minister will honour the strengthened Victorian State-Local Government Agreement, and we’ll need to bring our A game to secure outcomes to the State’s rate capping framework that don’t compromise either the financial sustainability of councils, or the services and infrastructure provided to communities.

Until then, I wish everyone a happy and safe festive season and I look forward to catching up with you at our strategic planning roadshows throughout February to discuss 2015 priorities, and to progress further wins for councils and our communities.

Best wishes
BILL