Myth: Your council rates pay for everything your council does.

Reality: In many councils, rates fund only around half of operating costs. In Newcastle it’s approximately 43%, and in Lake Macquarie it’s around 50%. The remainder comes from grants, user charges and other income, highlighting why long-term funding reform is so important.

This financial pressure is further amplified when grant funding from State and Federal governments declines.

One example is the Federal Financial Assistance Grants. In 1996, these grants were equivalent to 1% of Commonwealth taxation revenue. Today, they have fallen to less than half that level.

The result is growing pressure on council budgets, forcing difficult decisions about how limited funding is allocated, whether that’s repairing potholes, upgrading playgrounds, maintaining community facilities or investing in other essential local infrastructure and services.

On top of this, councils continue to face cost shifting, where State and Federal governments require local councils to deliver services or meet additional obligations without providing the funding to do so. This has happened over years to the point where councils are calling for funding reform so they can continue to provide the infrastructure and services their community needs.

Councils are expected to maintain roads, parks, libraries, sporting facilities, waste services, community infrastructure and much more, while balancing growing community expectations and increasing costs.

If you want strong, financially sustainable local government, we need your help to advocate for funding arrangements that match the responsibilities you expect your councils to deliver.