Grants for local government

There are a number of sources from which councils receive grant funding.

Victoria Grants Commission

On average, general (or Financial Assistance) grants make up about 8% of a council’s income. These funds are allocated by the Victoria Grants Commission, which is an independent statutory body operating within Local Government Victoria, in the Department of Planning and Community Development.

The Grants Commission’s main function is to allocate general revenue assistance provided by the Commonwealth government to Victorian councils, in accordance with the Local Government (Financial Assistance) Act 1995 and the approved national distribution principles.

The Commission can only provide funding to local councils. Grants Commission funds are not available to businesses, individuals or community groups.

The Australian Government provides general revenue assistance also called Financial Assistance grants to the states and territories for passing on to local councils. These are divided into General Purpose Grants and Local Roads grants, both of which are untied (which means that councils can determine how they spend these grants themselves).

General purpose grants are given to the states and territories according to population, with Victoria being allocated 24.8% of the total last year. Victoria’s share of local roads grants is fixed at 20.6% of the annual total. The Grants Commission then divides up the total available General Purpose Grants and Local Roads Grants among councils, using formulas that reflect the national distribution principles and factor in the local circumstances of each council.

Read more about the Victoria Grants Commission.

Other recurrent service grants

Councils also receive a range of recurrent funds from state or federal government to help pay for the operational costs of particular services or activities. Examples include:

  • home care services (home help, respite care, meals on wheels, senior citizens centres etc)

  • child care programs (family day care, occasional care, centre based care, maternal and child health)

  • public libraries

  • neighbourhood houses

  • immunisation programs

  • school crossing supervisors

These funds usually have specific conditions attached to them and may require some additional or matching contribution from rate revenue or users.

Project Grants

Councils also apply for “one off’ or fixed term government grants to fund a range of specific projects. These include capital or “bricks and mortar” projects that involve building something and establishing new programs. Examples include:

  • Community facilities (eg new public library building, swimming pool, park, road or bridge)

  • New programs (eg public environmental education programs – recycling, weed eradication, water management; recreation and leisure initiatives (eg. walking school bus, women in sport, access for all abilities)

  • Special “one off” events (either statewide - eg the 2006 Commonwealth Games, or local – eg the Rescue 2006 - the world surf lifesaving championships at Geelong and Lorne

These funds usually have specific conditions attached to them and require some additional or matching contribution by the council and/or the community. Councils often work in partnerships with their communities to develop funding applications for these project grants.

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