THE McGowan Government has announced a new lending facility so local governments can access short-term loans to help them with their cash flow.
WA local governments have already missed out on being able to take advantage of the Morrison Government’s Jobkeeper program, which the WA Local Government Association (WALGA) last month said could affect about 6300 local government employees.
Yanchep News Online last month asked Local Government Minister David Templeman if the McGowan Government was going to consider a job retention allowance for WA councils and shires such as that introduced by the NSW government.
Mr Templeman was also asked if the WA government would announce any new shovel-ready projects or bring forward any projects for the City of Wanneroo and the Shire of Gingin to help them during the Covid-19 crisis.
On April 30 a Department of Local Government, Sport and Cultural Industries spokeswoman said the focus of the WA state government was to work with local governments to provide stimulus and relief direct to businesses and the community.
“The state government is assisting local governments by removing barriers, including those that enable local governments to access funding,’’ she said.
When announcing – with Treasurer Ben Wyatt on May 7 – the introduction of a $100m short-term lending facility to support local governments through Covid-19, Mr Templeman said councils had a key role to play in supporting communities in responding to and recovering from Covid-19.
“A consequence of the necessary social distancing measures in place is that many local governments will receive less revenue in 2019-20 and into 2020-21 than they had budgeted for and will need to draw on cash reserves,’’ Mr Templeman said.
“The introduction of a new short-term liquidity facility will provide local governments a valuable tool in managing their liquidity through this crisis.
“I’d also encourage local governments to utilise their borrowing capacity, including for example, leveraging DCPs, to bring forward works to support local jobs in response to the pandemic.”
On April 17 WALGA president and City of Wanneroo Mayor Tracey Roberts said a decision by the LGIS board to deliver up to $9 million in one-off savings to participating local governments next financial year would help many local governments achieve their ambition of a zero rates increase this year.
All but one local government in WA are members of the LGIS scheme that covers workers compensation, liability, property and bushfire volunteers.
Mrs Roberts said the advantages of the mutual model and the ongoing participation of local governments had put LGIS in a position to offer additional support to councils during the Covid-19 crisis.
“The LGIS board has preferred a conservative approach to the management of the scheme’s funds and it is the wisdom in that approach and the strength of the mutual which has enabled this response,” she said.
The final amount of savings to be provided to member local governments would be finalised with the end of year results but the reserves component would ensure it was at least $7m in savings.
She said to provide context for individual local governments to estimate their probable benefit from the proposed $7m to $9m in savings, last year the LGIS scheme returned a $6m surplus to member councils.
