What are the Financial Assistance Grants?

Local government Financial Assistance Grants are general purpose grants that are paid to local councils under the provisions of the Commonwealth Local Government (Financial Assistance) Act 1995. This legislation also details how the total amount of grant funds is determined and how the funds are to be distributed between the States and Territories.

Financial Assistance Grants are un-tied in the hands of local government, allowing councils to spend the grants according to local priorities.

Refer to page 142, Operating and Capital Grants, Central Coast Council Delivery Program and Operational Plan 2018-19. Available at www.centralcoast.nsw.gov.au

Can Central Coast Council decide how to spend the Financial Assistance Grants?

The Financial Assistance Grant is an untied grant which Council is able to use on local priorities. This funding allows Council to provide services to the community free of charge or at a subsidised price such as play grounds, life guards patrolling our beaches, libraries, sporting facilities, skate parks, parks and reserves.

How does Central Coast Council determine priority areas for spending?

Council’s Operational Plan details delivery of essential services and capital works in the priority areas, which were outlined in the first Community Strategic Plan for the Central Coast. The priority areas are the outcomes of engaging with the community and they are what the community wants to see Council deliver on.  These are the road network, water and sewer service and infrastructure, protecting and enhancing the local environment, community facilities and open space and recreation.

Refer to page 138, Financial Overview, Priority Areas, Central Coast Council Delivery Program and Operational Plan 2018-19. Available at www.centralcoast.nsw.gov.au

How has Central Coast Council included the Financial Assistance Grant in the budget?

Council has included the Financial Assistance Grant in the Operational Plan for 2018-19 and it forms part of the Operating Grants and Contributions income which represents 8% of Council’s overall operating income.

Refer to page 139, Financial Overview 2018-19, Operating Income, Central Coast Council Delivery Program and Operational Plan 2018-19. Available at www.centralcoast.nsw.gov.au

Council includes the Financial Assistance Grant as part of General Revenue as it is an un-tied grant which Council is able to allocate to local priorities. General Revenue funds both operating expenditure to provide essential services and projects within the capital works program.  Within the 2018-19 capital works program Central Coast Council has $167.5 million in general revenue funded projects.

Refer to page 147, Capital Works Program, Central Coast Council Delivery Program and Operational Plan 2018-19. Available at www.centralcoast.nsw.gov.au 

How are the Financial Assistance Grants distributed by the Federal Government?

Local government grant commissions in each state and the Northern Territory recommend the distribution of the funding under the Financial Assistance Grant program to local governing bodies in accordance with the Act and the National Principles for allocating grants.

There are two components to the Financial Assistance Grants:

1. The general purpose component is distributed on a basis that takes into account each State’s share of the national population.
2. The local roads component is distributed on the basis of fixed shares of the national pool

The NSW Grants Commission distributes the grants based on national principles under the provisions of the Commonwealth Act and NSW principles. Financial Assistance Grants are a regular source of revenue for local government throughout Australia and are budgeted for based on information provided by the Commonwealth Government and NSW Grants Commission.

When is the payment of the Financial Assistance Grant?

The Financial Assistance Grant payments are usually made by way of quarterly instalments commencing in mid-August each year. This is followed by instalments in mid-November, mid-February and mid-May. There is a historical trend of prepaying the Financial Assistance Grant in June which is confirmed when the Federal budget is announced.