The Rudd Labor Government will deliver nearly $1.86 billion to Australia's local governments through financial assistance grants in 2008-09.

This funding will provide much-needed support to councils so they can provide their local communities with basic infrastructure and services such as local roads, swimming pools and sporting fields, child care, aged care and community services and cleaning and garbage collection.

The Government is committed to strengthening local communities and working closely with local government.

The $1.86 billion in funding is 4.5 per cent higher than in 2007-08, and maintains the value of the grants.

It includes $1.3 billion in general purpose grants and $571.5 million for local roads.

All of the grants are untied, meaning councils can spend them on the priorities determined by their local communities.

The Government will also provide councils with funding under the Roads to Recovery program.

South Australian councils will receive an extra $14.2 million in 2008-09, as part of a package over four years to 2010-11 to address South Australian councils' disadvantage under the local roads funding arrangements.

South Australia's disadvantage under the funding formula was documented in the 2003 House of Representatives inquiry into local government funding arrangements.

The Government will also deliver on its election commitments to local government. These include:

•  establishing a new Council of Australian Local Governments to work directly with local government on issues of national significance;


• setting up a mechanism for considering Constitutional recognition of local government; and


• including a nominee with local government experience on the board of Infrastructure Australia.

Note:

1. This table is based on an estimate of the factor used to calculate the 2008-09 grant pool. The estimated escalation factor will be determined in June 2008 along with the final determination for the 2007-08 grant pool. The grants paid in 2008-09 will be adjusted by the amount of any variation between the 200708 estimate and the actual grant pool entitlement. This adjustment is expected to be an additional $16.5 million.

2. The differences in the percentage grant increases are due to differences in the estimated population growth of the states and territories. General purpose grants are allocated between states and territories on the basis of population, whereas they receive fixed shares of the local road grants.

3. Does not include South Australia's $14.2 million supplementary local road grant in 2008-09, which will be paid separately.