Hunter MP Joel Fitzgibbon has criticised the federal government for announcing the latest round of Financial Assistance Grants without acknowledging the impact that a freeze on indexation will have on the funds for councils.
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Duty Senator for the Hunter John Williams issued a media statement last week to announce that Cessnock, Muswellbrook, Singleton and Upper Hunter councils would receive a share in more than $17 million.
“What Senator Williams didn’t tell readers is that, due to a budget decision to freeze the indexation of the grants, councils in the Hunter electorate will receive $8 million less over four years than should have been the case,” Mr Fitzgibbon wrote in a letter to the Mercury.
“This is a big hit on our cash-strapped councils and will mean less money for much needed local projects.
“These are standard annual allocations and it would certainly be a big story if our councils didn’t receive an allocation. Sadly, he failed to even mention Maitland.”
For the 2015/16 financial year, Maitland City Council was allocated $5.3 million for general purpose projects and $1.3 million for local roads.
Cessnock has been allocated $5.3 million from the general purpose fund and $1.5 million for local roads.
Upper Hunter Shire Council will receive funding of about $4.5 million.
Local governments across Australia will receive $2.3 billion this financial year.
Senator Williams said last week that more than $1 billion of the funding had already been paid to councils.
“Councils are free to spend this untied grant funding according to local priorities, including for infrastructure, health, recreation, environment, employment and roads projects,” he said.
Various federal governments have provided about $46 billion to councils across Australia as part of the Financial Assistance Grants program since it was first launched in the 1974/75 financial year.
In the 2014 budget, the Abbott government froze indexation of the grants until 2016/17.