Federal funding of local infrastructure projects: E-Alert May 2011

On 18 May 2011, the Auditor-General published the Australian National Audit Office's (ANAO) report on The Establishment, Implementation and Administration of the Council Allocation Component of the Regional and Local Community Infrastructure Program.  This report highlighted the fact that there have been delays in Councils delivering infrastructure projects which received funding from the Australian Government, and this may impact the funding of future projects.

The Regional and Local Community Infrastructure Program (RLCIP) was announced in late 2008 / early 2009 as a part of the Australian Government's response to the global financial crisis as a measure to support local jobs during the crisis and recovery phase, and to provide long-term benefits to communities through the provision of improved infrastructure.  The ANAO report examined whether the Council Allocation component of the RLCIP had been effectively designed, implemented and administered.  It found that by the middle of March 2011, more than 71 per cent of projects had been completed, with a further 6 percent of projects underway.  It also found that the rate of project delivery has been slower than anticipated with progress in the hands of councils.  As a result of the delays in delivering projects, the ANAO recommended that:

• grant applications be required to include a profile of planned expenditure and progress reports are to include revised expenditure profiles; and
• the Department of Regional Australia, Regional Development and Local Government (the Department) regularly evaluates the need for, and the optimal timeframe of, subsequent rounds of projects having regard to any delays with the commencement and completion of projects funded in earlier rounds.

These recommendations, which were accepted by the Department, highlight the need for future infrastructure projects to be delivered on time and on budget in order to receive Federal funding, and the fact that the Department may look at whether previous projects were delivered on time when determining funding of a local infrastructure project.

On a similar topic, the Minister for Infrastructure and Transport, the Hon Anthony Albanese MP, stated in relation to the release of the National Urban Policy, Our Cities, Our Future: a national urban policy for a productive, sustainable and liveable future on 18 May 2011, that the Federal government would be supporting State, Territory and local governments in making strategic investment and planning decisions in line with the National Urban Policy's goals of sustainability, productivity and liveability.  This policy underlines the intention of the Federal government to be involved, in partnership with State, Territory and local governments, in the planning and management of Australia's cities.

Maddocks are experts in the areas of Local Government, Planning and Construction Law.  If you require further information or insights into how this may affect your council, our team is well placed to assist.

Stan Kondilios | Partner

Direct 61 2 8223 4102

stan.kondilios@maddocks.com.au

Patrick Ibbotson | Partner

Direct 61 2 8223 4169

patrick.ibbotson@maddocks.com.au

Mal Fielding | Partner

Direct 61 2 9225 6201

mal.fielding@maddocks.com.au