State deals blow to local councils

COUNCILS battling to balance their own budgets in the wake of revenue shortfalls, were king-hit yesterday by the news the State Government was slashing their water and sewerage infrastructure subsidies.

The subsidy cut would slice $4.5 million from Ipswich City Council's budget in the next financial year and $23 million in 2010-11.

Mayor Paul Pisasale was confident that Treasurer Andrew Fraser would take with one hand and give with the other.

“This might just be a temporary issue until the State Government gets over their budget problems,” he said.

“There's got to be a formula in there to deal with growth.

“We understand that one lot of subsidies has gone.

“What I'm saying is 'don't leave us out on a limb'.

“We'll be cutting back growth if we don't get the infrastructure.

“I don't think it's time to panic yet.”

Cr Pisasale said he would not be passing infrastructure costs on to the Ipswich ratepayer.

He promised that rates, including water, would not rise beyond 10 per cent in the June 30 budget.

“I think people would expect me to keep the rise under seven per cent,” he said.

“I've always been fair and kept rises close to inflation.

“It's not looking good at the moment but we haven't had all the discussions and we're waiting for the state budget.”

The Local Government Association of Queensland (LGAQ) said the price of a new house could jump $5000 if Mr Fraser went ahead with scrapping the 40 per cent subsidy in today's Queensland budget.

The move would make housing less affordable and cost jobs in the housing industry, which is already struggling, said LGAQ acting president Councillor Bob Abbot.

“Queensland is the only state where local government has responsibility for providing water and sewerage and that subsidy is needed to offset the cost of new infrastructure,” he said.

“Councils will have to pass on this additional cost to developers and ultimately home buyers will be forced to foot the bill.”

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