Local Government’s important contribution to national productivity

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Local Government plays a key role in the provision of a range of services and infrastructure that underpin local and regional economic development and make an important contribution in achieving higher productivity nationally. Local government employs just under 189,000 Australians (around 10 percent of the total public sector), owns and manages non-financial assets with an estimated written down value of $354 billion (2013–14), raises around 3.5 percent of Australia’s total taxation revenue per annum and has an annual operating expenditure of around $33 billion (2013–14), just under six percent of total public sector spending.

Local roads, in particular, are an essential component of the national road network and enhance not only local and regional productivity but in aggregate make a significant contribution to state and national productivity.  

Economic development and productivity is a focus for almost every council. They contribute significantly to the productivity and economy of their regions – and nationally – by focusing efforts in three key strategic areas:

  1. Creating and maintaining the investment environment by ensuring the availability of appropriate physical and social infrastructure and lobbying on behalf of local and regional communities for sufficient community services such as education and training, health and wellbeing, community safety and emergency services.
  2. Facilitating new local investment by actively promoting business development through local economic development facilitation, strategic planning, working with business associations/main street organisations and active involvement with tourism or other business activities.
  3. Attracting external investment through the creation of new business and capital by collaborating with regional bodies such as Regional Development Australia, Austrade and developers to attract and create new businesses and investment.

Local Government is a natural leader in local economic development because councils know their local business communities, workforce and comparative advantages better than anyone else. Local people and businesses are the key to economic growth and development. In this regard, councils are perfectly positioned to work with local stakeholders to drive a bottom-up, place-based approach to achieve prosperity.

The Australian Local Government Association’s 2016–17 pre-budget submission, available on alga.asn.au, focuses on opportunities for the Federal Government to partner with Local Government to invest in an innovative and prosperous future for all Australians.