Ahead of the 2023 Federal Budget Regional Capitals Australia is making a call for funding shortfalls in infrastructure grants to be addressed by the federal government.
Cr Kylie King, Chair of Regional Capitals Australia said the cost of infrastructure delivery was becoming a shave or shelve concept as cost blowouts crunch local government budgets.
“Due to the extraordinary rise in the cost of infrastructure delivery, our member councils who have received federal grants for important social and economic infrastructure, are having to make the tough calls on the future of projects,” Cr King said.
“If the Federal Government does not play its part in assisting with these cost blowouts, our members have only two options – shelve the project and return the grant money or shave funding from other important local initiatives to meet the shortfall” she said.
“We are concerned that due to the size of the budget shortfall many projects will fall in the shelve category and regional Australians will miss out on important infrastructure required to meet the demand of our growing cities” Cr King explained.
In one case study cited by Broken Hill City Council, the proposed CBD Revitalisation Project was designed to include a new library and archives facility in addition to upgraded public infrastructure in the heart of the city, however with the project facing a significant shortfall due to cost escalations, the Council is now forced to try and seek alternative funding options to ensure the project can go ahead.
In another example at the City of Wagga Wagga, the proposed 5 kilometre Dunns Road upgrade has been affected by increases in materials and metal prices resulting in a budget shortfall of over $2 million.
According to Infrastructure Australia, public infrastructure projects including small capital projects, face a shortage of 214,000 skilled workers and in 2023 labour demand is projected to peak at 442,000 or more than double the projected available supply.
The RCA Pre Budget Submission 2023-24 also seeks to ease the burden on regional councils who often struggle to complete onerous business case requirements.
“Regional Australia is punching above its economic weight at the moment, but when supply chains and labour markets are tight we need to find a more efficient way so grant dollars can go further in our local communities” Cr King explained.
REGIONAL FUNDING NEEDS A RETHINK
