Regional SA councils struggling to pay for roads call for fairer funding model

Australia Broadcast Center

31-05-2025

South Australian councils say the system for funding road upgrades and maintenance is unbalanced and unfair.
Wakefield Regional Council is responsible for a 2,687-kilometre road network, which is longer than the distance between Adelaide and Perth.
The council has a lower-than-average population of 6,780 people.
It means the council has a lower annual revenue to fund road projects.
"Three or four years ago we did a complete analysis of our road network and we worked out we had a $16 million backlog of road upgrades waiting for us," Mayor Rodney Reid said.
He said the council created a program to address the backlog by allocating additional money every year for a 10-year period.
"Even then, after 10 years, we won't get it back to zero, that's the level of difficulty a regional council like us faces," Mr Reid said.
He said the funding demand for road upgrades and maintenance meant the council had to put off other projects.
"We've got masterplans for various sporting precincts and we can't really do anything on it unless we get specific funding for it," he said.
Councils receive money from the South Australian Grants Commission, which the state government funds.
The federal government funds the state government.
Mr Reid said he had written to the grants commission asking for a fairer system for regional councils.
The commission said it was examining the distribution process to ensure it was fair.
"The commission is currently looking at elements of this methodology, including the proposal put to it by the Wakefield Regional Council regarding the distribution of identified local road grants," a spokesperson said.
A state government spokesperson said the commission was an independent body that made recommendations for the distribution of grants in accordance with Commonwealth legislation.
South Australia receives 5.5 per cent of the identified local roads grants component of financial assistance grants.
However, South Australia's population represents 7 per cent of the nation's total population.
It has 11.7 per cent of the nation's local road network.
The Mid Murray Council has a population of 9,160 people and the second largest road network in the state at 3,386km.
Its chief executive, Simone Bailey, said regional councils did not receive enough funding from the federal government.
"A lot of that money from the feds is going to councils in the metro area, who don't need funding," she said.
A parliamentary inquiry is examining the sustainability of local governments, with an interim report from February highlighting a need for increased funding to Australia's 537 local governments.
Wakefield Regional Council received $4.7 million over five years through the federal government's Roads to Recovery program, while Ms Bailey's Mid Murray received $5.8 million.
The City of Onkaparinga in Adelaide's south, which received $20.9 million, is responsible for a smaller road network of 1,530km.
Ms Bailey said her council's cost-cutting measures, such as closing the Mannum Pool last summer, had hit communities hard.
"It was costing us $35,000, which, maybe to some other councils that's not much but for us, it's a lot," she said.
"We're not like city councils where we can have huge parking stations or other forms of income.
"It was one of the hottest, driest summers on record and the town of Mannum didn't have a pool."
A total of 0.51 per cent — $3.45 billion — is allocated to local governments in this year's federal budget, with some council funding put up for tender as competitive grants.
Southern Mallee Council Mayor Ron Valentine said a tender system favoured larger councils.
"It's prejudicial against small councils like ours because the big players in town, big growth councils, have professional grant writers, directors and all the support teams to be able to come up with really great glossy tenders," he said.
"Even if we wanted to put a tender in, it's problematic because we don't have all those assets to put to it.
"And then, there's no guarantee you're going to get the money."
Mr Valentine said he had raised his concerns with federal government representatives.
He said the government already knew who needed funding.
"What's not coming is enough money from the federal government to do it," he said.
Federal Minister for Regional Development Kristy McBain said the government had initiated the Parliamentary Inquiry into the Financial Sustainability of Local Government, which was the first of its kind in two decades.
"We look forward to receiving the final report of the inquiry," she said.