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NT Grants Commission Annual Report 2007-08

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NT Grants Commission Annual Report 2007-08 ????? Annual Report 2007-08 Northern Territory Grants Commission 1 NORTHERN TERRITORY GRANTS COMMISSION Annual Report 2007-08 ISSN 1835-4440 Letter to the Minister Mr Robert Knight MLA Minister for Local Government Parliament House DARWIN NT 0800 Dear Minister In accordance with section 16 of the Local Government Grants Commission Act, I have pleasure in presenting to you the Annual Report for the Commission on its activities for 2007-2008. Included in the report are the financial statements for the year ended 30 June 2008. Yours sincerely Robert Beadman Chairman 16 September 2008 Annual Report 2007-08 NORTHERN TERRITORY GRANTS COMMISSION 1 Contents Foreword 4 The Commission 6 Background 7 Relevant Legislation 7 Organisation and People 8 Membership 9 Members’ Profiles 10 Administration and Staffing 11 Summary of Activities in 2007-2008 12 Review of the Financial Assistance Grants Methodology 13 Annual Conference 13 Executive Officers’ Meeting 13 Visits to Local Governing Bodies 13 Public Hearings 13 Financial Data 14 Data Collection Returns 14 Annual Financial Statements 14 Submissions 14 Payments 2007-2008 14 Estimated Entitlement 2007-2008 14 Entitlement 2007-2008 14 Cash Entitlement 2008-2009 15 Communication with Councils 15 Revenue and Expenditure Assessments of Local Governments 15 Recommendations 16 Chairman’s Letter 17 Recommendation 1 Schedule of Estimated Entitlement 18 Recommendation 2 Schedule of Under/Overpayment 2007-2008 19 Recommendation 3 Schedule of Cash Payment 21 2 NORTHERN TERRITORY GRANTS COMMISSION Annual Report 2007-08 Contents Schedules 22 Schedule 1 Population 23 Schedule 2 Northern Territory Grants Commission Cost Adjustors and Key Drivers 2008-2009 23 Schedule 3 Councils Local Road Lengths 24 Schedule 4 Reconciliation of Local Government Income and Expenditure 25 Schedule 5 Local Government Income 2006-2007 26 Schedule 6 Actual Local Government Expenditure 2006-2007 28 Schedule 7 Assessed Revenue 2006-2007 30 Schedule 8 Summary Standardised Revenue 34 Schedule 9 Standardised Expenditure 36 Schedule 10 National Distribution and Shares of Financial Assistance Grants 2008-2009 37 Schedule 11 Visits to Local Governing Bodies 38 Public Hearings to Councils 39 Schedule 12 Local Governing Bodies that Failed to Lodge their 2006-2007 Annual Financial Statements by the Date Specified 39 Appendices 40 Appendix A National Principles For The Allocation Of General Purpose And Local Road Grants 41 Appendix B Methodology and Formula Factors 42 Methodology 42 Population 42 Revenue Raising Capacity 42 Expenditure Needs 43 Cost Adjustors 43 Formula 44 Application of Cost Adjustors 45 Appendix C Revoked Local Governing Bodies 46 Appendix D Re-Structuring Orders to Establish New Councils 47 Appendix E The Australian Classification of Local Government (ACLG) 48 Appendix F Northern Territory Local Governments by Classification 49 Appendix G Northern Territory Map of Shire Areas 50 Appendix H Auditor-General’s Report to the Minister for Local Government Northern Territory Grants Commission For The Year Ended 30 June 2008 51 Annual Report 2007-08 NORTHERN TERRITORY GRANTS COMMISSION 3 Foreword Foreword Section 16 of the Local Government Grants Commission Commission to assess the needs of the local governments based Act 1986 requires that the Commission report annually to on real Territory averages leading to a more realistic distribution the Minister for Local Government on its activities during the of the financial assistance grants. The data is also forwarded to year, and in particular its activities relating to Commonwealth the ABS for use in government finance statistics and national financial assistance to local governing bodies. accounts. In this process a very good working relationship has been established between the relevant staff of ABS and staff I am pleased to present the twenty-second annual report on of the Commission. behalf of the Northern Territory Grants Commission. The report contains information on the distribution of funding provided The collection of the financial data for the 2007-2008 financial to the Northern Territory’s local governing bodies under the year, will be the last year where the Annual Return will be Commonwealth’s Local Government (Financial Assistance) completed by the 63 existing councils. For the 2008-2009 Act 1995, as well as details on the objectives, performance financial year the annual return will be completed by eight and future directions of the Commission. My hope is the report councils and eight new local government shires. conveys sufficient relevant information on the Commission’s The rolling program of Commission visits to communities and programs and performance during the year to enable any their outstations were postponed for the 2007-2008 year agency, organisation or individual so interested to assess its due to the Northern Territory’s local government reform which operations and functioning. was being undertaken and the Commonwealths’s emergency Following the Northern Territory Government’s announcements response. Only 2 locations were visited this year with public about local government reform the Commission issued a hearings being held in Darwin and Alice Springs. In the future, discussion paper to invite comments from interested local visitations will be on a shire and municipal basis. governing bodies on the options available to the Commission in On behalf of the Commission, I wish to record our appreciation developing a methodology that adapts to the changed structure. for the valuable cooperation and assistance that we have The paper highlighted the need for the Commission to re-visit received during the Commission’s work throughout the year and amend the cost adjustors that are used in the methodology. from most local governing bodies, and in particular, those A total of five submissions were received from councils and they visited during the year. The Commission would like to express supported a review of the cost adjustors to suit the structure of its thanks to the Darwin and Alice Springs councils for the use the new shires. of their facilities during the Commission’s public hearings. The original review of the methodology commenced in The Commission is grateful for the executive support and 1998 and was completed in 2006-2007. That review assistance of Mr Abdus Sattar and Mrs Donna Hadfield of then highlighted the need for a regular process of continued the Local Government Division, the Department of Local improvement in further refining the revenue and expenditure Government, Housing and Sport, combined with the assistance categories and appropriate cost adjustors. Hence, New Local and services provided by the regional offices of the Department. Government has proven that the methodology needs to be I would also like to take this opportunity to acknowledge the reviewed again to ensure the expenditure categories and efforts of my colleagues, Mr Nick Scarvelis, Ms Frances Kilgariff, cost adjustors are appropriate for the structure. Mr Maurie Ryan (resigned October 2007), Ms Anne Perry The new method for the collection of local government and deputies Mr John Bailey and Mrs Margaret Vigants. financial data and performance information introduced in Their assistance has been very much appreciated. November 2003, has proved successful and was used again in 2007-2008. This collection process will continue in future years with consideration being given to collecting data at a lower level than originally anticipated. This process of data collection has been invaluable to the Commission. The data collected on the returns is now used by the Commission instead of personal incomes and a hypothetical Robert Beadman spread of expenditure across categories. It has enabled the Chairman Annual Report 2007-08 NORTHERN TERRITORY GRANTS COMMISSION 5 The Commission The Commission Background The Local Government (Financial Assistance) Act 1995 also requires each state and the Northern Territory to have a local On 1 July 1986 the Australian Government begun a process government grants commission. In accordance with that of yearly appropriations to the State/Territory Governments for requirement, the Northern Territory legislated for a statutory, distribution as financial assistance grants to local governing independent commission, the Northern Territory Grants bodies within the respective jurisdictions. A subsequent review Commission, in June 1986. of the enabling legislation led to the current Act, the Local Government (Financial Assistance) Act 1995. Even though Role of the Northern Territory Grants Commission around 15 per cent of the Northern Territory population lived The Northern Territory Grants Commission is established as an in areas outside recognised local government boundaries, the independent statutory authority under the Local Government Commonwealth legislation provides, among other things, for Grants Commission Act. Its primary role is to allocate financial the total Northern Territory population to be taken into account assistance grants provided by the Australian Government to in determining its global financial entitlement, relative to the Northern Territory local governing bodies in the form of general other Australian States. purpose grants and local roads grants. Under section 6(1) of the Act, the Commonwealth Minister, after consulting with the relevant State Ministers and with Relevant Legislation bodies representative of local government, must formulate The Northern Territory’s Local Government Grants Commission national principles. Act governs
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