Rate capping legislation | China’s National Sword | 2018-19 Federal Budget | Council Elections No Images? Click here Vol 3: Issue 17 - Monday 7 May 2018 Big thanks to all who attended our coastal forum. Your insights and comments help shape our way forward and most particularly our thinking around the governance structures for coastal management in local government. Work is complete on our data for recycling and councils’ needs, both short and long term. We have now approached the State with a good backing of facts and figures and are hopeful for a response that will protect the future of kerbside recycling in SA. LGA President Mayor Lorraine Rosenberg Rate capping legislationSouth Australia’s new State Parliament was opened on Thursday, which means that the Government will soon introduce its rate capping legislation into the Lower House to meet their first 100 days of government commitment. Last week I wrote to the Minister and asked him to defer debate on this Bill until the spring session of Parliament in September, to allow the LGA to thoroughly consult with our member councils on the details of their proposal. This would allow the Government to introduce the legislation as promised, and wouldn’t interfere with their intention to bring a rate capping scheme into effect in the 2019-20 financial year, should they have the support of the Parliament. There is a long standing protocol in relation to government legislation impacting on local government to consult with the LGA and councils before parliamentary processes commence. As a sector we understand and are opposed to the concept of rate capping, and members have varying views about what it will mean for their councils. We need to thoroughly understand the detail of what is being proposed by the government and consult with council on the specifics of the proposed model before finalising a sector position on the legislation. Prior to the election the Liberal Party committed to capping the fees and charges collected by councils in addition to capping rates. This will add an additional burden and a level of complexity that must be fully considered. I will keep you updated on this Bill and any consultation opportunities through my weekly newsletter. China’s National SwordA market analysis report commissioned by the LGA has identified that at this point in time councils are facing increases in costs of up to $8.8 million per annum as a result of China’s National Sword policy. This figure is based on a $63 per tonne increase in the cost of processing recycled materials, with South Australian councils collecting 140,000 tonnes of kerbside collected comingled recyclables each year. The primary concern of the local government sector is to ensure the ongoing sustainability of the recycling industry in South Australia - and preserve the community’s trust and faith in the recycling process - through this period of transition. We are seeking strong action by the State Government to establish a local reprocessing and remanufacturing industry here in South Australia that will ensure the long-term viability of the system. In the meantime, the best method of equitably assisting councils to continue providing cost-effective waste management services to communities is through a freeze on any further increases to the solid waste levy. This levy is scheduled to increase from $87 per tonne to $100 in metro areas on 1 July, and the Government should not be imposing increased levy rates on councils at a time when they are already facing increased costs due to market forces beyond their control. A freeze to the Solid Waste Levy would save South Australian councils around $4.5 million in 2018-19. Given there is already over $100 million accumulated in the Solid Waste Levy fund, councils and other members of the waste management sector who have been disadvantaged by these developments should have the opportunity to apply for funding from the Green Industry Fund to help manage increased costs. Similar to the approach taken interstate, grant funding should be provided following the submission of a business case. The LGA commissioned market analysis report also concludes that the cost to dispose recyclables to landfill becomes lower than the cost to transport and process these materials when transporting co-mingled recyclables over 360 kilometres. In assessing applications for grant funding particular consideration should be given to regional councils for whom the cost of transporting recyclables for processing is very significant. In conjunction with Green Industries SA the LGA will hold a workshop on 5 June where we will consider opportunities to develop local recycling markets, and develop a true circular economy. More information on this event can be found on our website. 2018-19 Federal BudgetTomorrow night in Canberra the Treasurer the Hon Scott Morrison MP will hand down the 2018-19 Federal Budget. From a local government perspective our priorities in this year’s Budget are finding a permanent solution to SA’s unfair share of road funding, and an increase to the quantum of Financial Assistance Grants. South Australia has 11% of the nation’s local road network, and 7 percent of the nation’s population, but only receives 5.5% of the Identified Local Roads Grant funding. In recognition of this anomaly, SA has traditionally received around $20 million per year in supplementary road funding to address the unfair share of Commonwealth road funding received by South Australian councils. This was removed in the 2014-15 Budget, before being reinstated for two years from 2017-18. There is no guarantee of this funding beyond 2018-19, and we are advocating for the allocation to be made permanent to provide councils with certainty of funding for maintaining their local roads. The total value of Financial Assistance Grants (FAGs) as a percentage of national taxation has declined from around 1% in 1996 to 0.55%. FAGs are particularly valuable for councils as the funding is untied, meaning it can be put towards local priorities. While we acknowledge and appreciate the return of FAGs indexation in last year’s budget, councils collect just 4% of national taxation, and we believe that over time the total value of this fund should be returned to its previous level to ensure we are resourced to provide the services and facilities our communities need. SA Councils will become even more reliant on Financial Assistance Grants should the State Government be successful in capping our ability to raise revenue. Rate capping is a state imposed cost shift onto the federal government from the state government, and we continue to make our Federal MPs aware of this in the lead up to the federal election. ALGA has been doing a great job advocating on behalf of all councils and I thank my colleagues from interstate LGAs for their ongoing support for South Australia’s supplementary road funding. I wrote to Deputy Prime Minister and Minister for Infrastructure the Hon Michael McCormack MP in March to highlight these issues on behalf of our sector and am hoping we get some positive news tomorrow night! The LGA team will be working with ALGA on a thorough analysis of the Federal Budget and you can stay up to date on what it all means for local government at www.lga.sa.gov.au/federalbudget from around 9.00pm tomorrow night. Council ElectionsJust six months to go until the 2018 Council Elections, so it’s a good opportunity to take a look at how the process is playing out in the UK. Hopefully we don’t see some of these humorous mistakes repeated in SA in November... For further information or to submit |