VICTORIA GRANTS COMMISSION ANNUAL REPORT 1986

Annual Report

of the

VICTORIA GRANTS COMMISSION

for the

Year ended 31 August 1986

Ordered by the Legislative Assemb(v to be printed

MELBOURNE F D ATKINSON GOVERNMENT PRINTER 1985-86 No. Ill

4818(f1) VICTORIA GRANTS COMMISSION ANNUAL REPORT 1986

The Hon. J. L. Simmonds, M.P., Minister for Local Government, 480 Collins Street, , V/C. 3000.

As Members appointed under section 3 of the Victoria Grants Commission Act 1976, we have the honour to present the tenth Annual Report of the Victoria Grants Commission, in accordance with section 17 ofthat Act.

D. V. MOYE, Chairman

L. F. CHEFFERS, Member

D. M. FULLER, Member M. A U1brick Secretary

October, 1986 VICTORIA GRANTS COMMISSION

MEMBERS

D. V. Moye, B.Ec., H.D.A.(Hons.), Chairman L. F. Cheffers, L.G.E., M.I.E.Aust., F.I.M.M., M.B.S., O.A.M. D. M. Fuller, T.P.T.C.

STAFF

M. A. Ulbrick, B.Ec., Dip.Ed. Secretary A. Bashtannyk Assistant Secretary J. Chow, B.Ec. C. Rowe, B.A.(Hons.) F. McHarg, B.Sc. Computer Systems Officer J. Gibbons Confidential Secretary

LOCATION

The Commission's offices are on the 15th floor, State Insurance Building, 480 Collins Street, Melbourne (postcode 3000). TABLE OF CONTENTS Page No. ROLE OF THE COMMISSION...... ix

CHAPTER 1. THE YEAR'S ACTIVITIES...... 1 General Revenue Allocations for 1985-86 ...... 1 General Revenue Allocations for 1986-87 ...... 1 Inspections...... 2 Submissions...... 3 Annual Return of Information...... 3 National Inquiry into Local Government Finance...... 4 The Local Government (Financial Assistance) Act 1986...... 6 Implications for Victoria...... 7 Conference ofState Grants Commissions...... 8 Other Meetings, etc...... 8 Members...... 9 Staff...... 9

2. THE BASES OF THE 1986-87 ALLOCATIONS...... 10 As-of-Right Entitlement...... 10 Horizontal Equalisation...... I 0 Local Government Restructure...... 11 Acknowledgements...... 12

APPENDICES I 1985-86 Determinations...... 13 11 Transmittal Memorandum and Determinations, 1986-87 ...... 18 Ill Municipalities Inspected 1985-86 ...... 25 IV Distribution of Rateable Property, Rate Income, Rating and Population 1975-76 to 1984-85...... 26 V Tax Sharing Funds for Local Government Authorities 1974-75 to 1986-87 ...... 28 ROLE OF THE VICTORIA GRANTS COMMISSION The Commission consists of a Chairman and two other members, appointed by the Governor in Council for a period of not more than five years. At least two mem­ bers of the Commission shall have a knowledge and understanding of local govern­ ment and members are eligible for re-appointment at the expiry of their terms of appointment. The principal role ofthe Commission is to determine, on or before 31 August each year, the allocation to municipalities in Victoria of general revenue grants from the Commonwealth to the State for local government authorities under the provisions of the Commonwealth's Local Government (Financial Assistance) Act 1986 and under the Victoria Grants Commission Act 1976. To assist the Commission in this role, the Victoria Grants Commission Act provides that: "10. (I) Each municipality shall supply the prescribed information to the Commission- (a) on or before the day fixed by the Commission by notice published in the Government Gazette; or (b) in the case ofa particular municipality on or before such later date as is fixed by the Commission for that municipality. (2) Where a municipality has not complied with sub-section (1) the Com­ mission shall nevertheless allocate to the municipality its 'As-of-right Entitlement'." The Act also provides that: "13. The Commission or any member thereof may carry out such inspec­ tions, conduct such hearings, take such evidence and generally make such investigations as the Commission thinks necessary for the purpose of properly carrying out its functions under this Act." In relation to proceedings before the Commission the Act stipulates that: "15 A municipality may be represented in proceedings before the Commis­ sion by Councillors or the municipal clerk or the municipal engineer or full-time officers of the municipality and not otherwise." The Act also provides that the Minister for Local Government may "on his own motion or at the request of the Commission make written submissions to the Com­ mission as to any factors which appear to the Minister to be of special significance in relation to all or any municipalities in the relevant financial year" (section 14). In so doing, the Minister is required to publish notice of a submission in the Government Gazette, to lay copies of the submission before both Houses of Parliament and make copies available to the public. No submission has been made under this provision to date. In addition, the Commission is required to "enquire into and report upon any matter relating to local government finances which is referred to it by the Minister" (section 16). Such a reference was made to the Commission in November 1984; it was concerned with the prospective financial advantages of restructing local government in Victoria. The Commission reported to the Minister on the matter in July 1985. No further reference has been made to the Commission under this provision. The Commission was convened on eighty-three days during the year ended 31 August 1986. Section 17 of the Act requires the Commission to report to the Minister by 30 November each year on the activities of the Commission during the preceding year ended 31st August. This Report is in compliance with that requirement. Chapter I THE YEAR'S ACTIVITIES

GENERAL REVENUE ALLOCATIONS FOR 1985-86 1.1 As a result ofan amendment to the Local Government (Personal Income Tax Sharing) Act 1976 in May 1985, the amount to be made available for allocation in 198 5-86 was to be a 2 per cent real terms increase in the amount provided for alloca­ tion for 1984-85. The relevant period for determining the Consumer Price Index (C.P.I.) to be used for calculating the increase was the four quarters ending 31 March 1986 compared with the previous four quarters. This meant that the amount made available in August 1985 had to be based on an estimate of the increase in the C.P.I. for the relevant period. Provision was made in the amending legislation for adjustments to the August 1985 figure should the actual C.PJ. increase differ from the estimated figure. 1.2 The estimated increase in the C.P.I. was 7.80 per cent and the application of this figure, coupled with the 2 per cent betterment factor, provided for an initial allocation for Victoria of$136, 157,634. In the event, the actual increase in the C.P.I. for the relevant period was 8.00 per cent and the application ofthis figure and the 2 per cent betterment factor to the base figure meant that Victoria was entitled to an extra payment of $252,612. This brought the total amount for Victoria for 1985-86 to $136,410,246, which was an increase of 10.16 percent over the amount provided in the previous year. 1.3 The additional amount of$252,612 was allocated among the 210 munici­ palities in accordance with each municipality's share ofthe funds previously allocated for 1985-86, net ofspecial factor allowances. The Commission made a Supplementary Determination of the allocation of the additional amount on 26 May 1986. This was endorsed by the Minister, the Hon. Jim Simmonds, on the same day and payments were effected shortly thereafter. A copy of the Commission's Supplementary Deter­ mination is included in Appendix I.

GENERAL REVENUE ALLOCATIONS FOR 1986-87 1.4 In the 1986 Autumn Session of the Commonwealth Parliament the Local Government (Financial Assistance) Act 1986 was passed. This Act repealed the Local Government (Personal Income Tax Sharing) Act 197 6 and provided a new basis for the continued funding by the Commonwealth of general revenue assistance for local government. The new legislation came into force on l July 1986. 1.5 The new legislation provides for the inclusion of the Northern Territory in the general revenue funding arrangements for local government for the first time. Adjustments have been made to the base year figures to include an amount for the Northern Territory and the apportionment of the total amount for 1986-87 includes a component for the Northern Territory. 1.6 The legislation provides for a guaranteed real terms increase in the amount of funds to be provided for 1986-87 and 1987-88. However ifthe increase in general purpose payments to the States (financial assistance ~ants, identified health grants and general purpose capital assistance payments) for etther of the two years were to be greater than the increase in the relevant Consumer Price Index (C.P.I.) figure, the amounts made available as general revenue funding for local government would also be increased by the same margin. As the total payments to the State Governments for 1986-87, as determined at the June 1986 Premiers' Conference, fell short of the estimated C.P.I. figure for the relevant period, the amount allocated for local govern­ ment general revenue funding for 1986-87 was determined by the estimated C.P.I. figure. l. 7 The estimated C.PJ. increase for the relevant period, as published in the Commonwealth ofAustralia Gazette, No. S428 of 28 August 1986 was 8.25 per cent. This provided for a total amount of $585,613 million. 1.8 The new legislation also provides for the basis of apportionment between the States and the Northern Territory to be changed from the percentage shares that have been used since 1977, to population shares. This change is to be phased in over the period to 1988; thereafter the shares for each State and the Northern Territory are to be determined solely by reference to their1)opulations. 1.9 The percentage shares for 1986-87 as laid down in the Act and the amounts for the respective States and the Northern Territory are: Percentage Amount($) New South Wales 36.1593 211,753,586 Victoria 25.2153 147,664,092 Queensland 16.7043 97,822,564 Western 9.3026 54,477,241 South Australia 8.5212 49,901,261 Tasmania 3.1700 18,563,934 Northern Territory 0.9273 5,430,390 100.0000 585,613,068 The total of general revenue funds made available by the Commonwealth for alloca­ tion to local government since the first revenue grants were made in 1974-75 is $3,985 million; of this total amount Victoria has received $1,012.9 million (see Appendix V for further details). 1.10 The Commission completed the Determination of the allocations and pre­ sented them to the Minister for Local Government, the Hon. J. L. Simmonds, on 28 August 1986 for transmittal to the Commonwealth Minister for Local Govern­ ment and Administrative Services, the Hon. Tom Uren, for ratification. A copy ofthe Transmittal memorandum and the Determination of the allocations for 1986-87 is included in Appendix II.

INSPECTIONS

1.11 Inspections were undertaken of forty-two municipalities throughout the State overthe period commencing 26 November 1985 running through to 5 June 1986 (see Appendix Ill); this completed a five year cycle in which each municipality in the State was visited for inspections and discussions. 1.12 The aim of the inspections has been to cover the ran~e of services being provided by the respective councils, in order that the Comm1ssion might better appreciate the conditions which each Council faces in serving its community. A period was set aside at the end ofeach inspection for discussion with Councillors and their officers about the role of the Commission and about aspects of municipal func­ tions which are relevant to that role. 1.13 These inspections and discussions have been invaluable to the Commission because of the benefit ofa more comprehensive knowledge of the physical character­ istics ofeach municipality and a greater appreciation of the social and environmental aspects of the respective areas which have influenced Councils' expenditure policies. This is important in distinguishing between costs which are related to needs and disabilities and costs which reflect Council's policy decisions. 1.14 The flexibility available in inspection programming as a result of the shift to a five-year framework has enabled the Commission to devote more time to areas where special circumstances prevail. During 198 5-86, the Commission made a special visit to the Portland area to update its information about the Alcoa project's effects on the area, the project having recommenced since the Commission's previous visit. In addition, the Commission has been able to program its inspections to include visits to areas that experience heavy pressureoffacilities due to the influx ofvisitors during the summer holiday period.

2 SUBMISSIONS 1.15 The Commission does not require Councils to make formal submissions each year. In many cases annual submissions would simply be repeating points made in previous submissions and therefore would serve little purpose. However, the Com­ mission encourages Councils to make submissions where they believe there have been material changes to circumstances within the municipality or where some aspect of the municipality's functions may have been overlooked. Also, as part of the presen­ tation of itineraries, the Commission requires detailed summaries of significant features of the respective municipalities, particularly those in areas being inspected during the visit. This provides a further opportunity to update information on various aspects of each municipality.

ANNUAL RETURN OF INFORMATION 1.16 Section l 0 ofthe Victoria Grants Commission Act 1976 authorises the Com­ mission to require each municipality to provide prescribed information on or before a date fixed by the Commission. In conformity with that section, 4 December 1985 was the date fixed by notice in the Victoria Government Gazette No. 86 of21 August 1985 as the date by which the prescribed information for the 'financial year ended 30 September 1985 should be returned to the Commission. The prescribed information includes the Return of Accounting and General Information (hereinafter called Return) together with the Statement of Accounts whether in audited or unaudited form. 1.17 The commission has worked closely with the Victorian office of the Aus­ tralian Bureau of Statistics on the continuing development of the joint Return of statistical and other information which serves the needs of the Commission and the Bureau. The Return has been devised to conform with the standardised form of recording local government financial statistics and with the new regulations for local government accounting, which is also aligned to the standardised format. The statis­ tics derived from the Annual Returns are published by the Australian Bureau of Statistics in its Bulletin "Local Government Finance- Victoria" (Catalogue No. 5501.2), which provides detailed information on local government income and expenditure for each municipality, over a wide range offunctional headings. 1.18 Notwithstanding the substantial improvement to the presentation of local government financial information as a consequence ofthe adoption of the standar­ dised format oflocal government accounting, the lack of uniformity in the treatment of oncosts and overheads continues to be a matter ofconcern. Until this is resolved, it will be necessary to continue to seek information about the treatment of oncosts and overheads for all functions, so that adjustments can be made to the data to make it more comparable. 1.19 The Commission has previously referred to the benefit that can accrue from reducing delays in the processing of information which is essential to the allocation process. The date of payment ofthe grants is largely determined by the date by which the allocations are finalised, once the total for the State is known. With the amount of money now involved, there is an obvious financial incentive for all Councils to ensure that there is no undue delay to the Commission's work which might hinder the earliest practical completion ofthe Determination. 1.20 The Commission is concerned about the increasing number of municipali­ ties that fail to lodge their Returns and Statements of Accounts by the due date, without a reasonable excuse. The follow-up rate for the 1984-85 Returns and State­ ments of Accounts was the worst since the Commission's inception. This meant that much of the staffs time in the early months of 1986 was wasted on follow-up action and the processing of financial and other data was seriously impeded. In the most intransigent cases letters were sent to the Mayor/Shire President ofthe relevant muni­ cipality drawing attention to the situation and to the financial penalties implicit in the legislation for non-compliance with the statutory information requirements.

3 These letters were sent only after reminder letters to the respective Town/Shire Clerk and a number of telephone calls to the municipal offices failed to produce any indica­ tion of when the documents would be lodged. The municipalities involved were: City of St. Kilda $lire ofMyrtleford Town ofBairnsdale Shire ofNarracan Shire ofNumurkah Shire ofPhillip Island Shire ofHealesville Shire ofKyneton Shire ofYarrawonga In addition it became necessary to write to the Mayors/Presidents ofa further nine municipalities where extensions oftime to complete the Returns had been substan­ tially exceeded or the requirements had only been partially met and no progress towards fulfilment appeared likely. The municipalities involved were: City of Hamilton Shire ofNewham and Woodend City of Portland Shire ofPhillip Island Shire ofBacchus Marsh Shire ofWannon Shire ofBallarat Shire ofWaranga Shire of Metcalfe 1.21 The Commission has been reluctant to impose explicit financial penalties on these municipalities because they would effectively fall on the ratepayers. How­ ever, because of the effects of delays to its work programme due to late lodgement of returns and late or non-provision ofeven draft Statements of Accounts, the Commis­ sion will have to address the question ofapplying financial penalties to municipalities that, without reason, fail to lodge statutory information by the due date. The Com­ mission will be giving close attention to those municipalities who have a poor record in this regard, particularly those to whom follow-up letters have had to be sent. The Commission accepts no responsibility for anr deficiencies in the allocations for these municipalities that result from shortcomings m the provision ofessential information for its determination processes.

NATIONAL INQUIRY INTO LOCAL GOVERNMENT FINANCE 1.22 On I 0 May 1984 the Minister for Local Government and Administrative Services (then Temtories and Local Government), the Hon. Tom Uren, M.P., announced that the Commonwealth Government was establishing a Committee to review the arrangements for Local Government revenue sharing. The Committee's terms of reference were: "To review the local government tax sharing arrangements and report on any changes required to improve the operation of the Local Government (Personal Income Tax Sharing) Act 1976 with reference to: • the respective roles of the Commonwealth and the States in regard to local government; • the purpose and functions oflocal government revenue sharing; • the level and form of funding for local government available from the Com­ monwealth, State and local government sources, and the principles which should determine the level and allocation of the local government revenue sharing funds between and within states."' The Committee was chaired by Professor Peter Self, Senior Research Fellow at the Urban Research Unit, Australian National University and formerly Professor of Public Administration at the London School of Economics. 1.23 The Committee's Report was completed on 25 October 1985 and released for public comment early in November 1985. (Report of the National Inquiry into Local Government Finance, Australian Government Publishing Service, Canberra,

4 1985.) The Report is a very comprehensive publication of nearly 500 pages and contains some fifty recommendations (see pages xxii to xxx of the Report). There are also two supplementary volumes of research papers. 1.24 Insofar as the general revenue grants arrangements are concerned, the Com­ mittee recommended that the arrangements should continue but with some modifi­ cations. The main modifications proposed were: • the nexus between personal income tax receipts and the amounts available for allocation be broken; instead the amount provided in 1985-86 should be main­ tained in real terms until the next review of State Government general revenue sharing arrangements. However, if the States were to do better than a real terms maintenance of funding for State Government payments then the increase in local government funding should match that increase; • local government general purpose assistance arrangements should be further reviewed in 1988, along with the review ofState Government funding arrange­ ments; • a review ofthe interstate distribution offunds should be reviewed before 1986- 87 but, if no such review was carried out, the distribution should be on a per capita basis; • State and Northern Territory Grants Commissions should continue as the bodies responsible for recommending the allocations between local authorities within the respective States; • the Commonwealth should promulgate guidelines for the State Grants Com­ missions for the general methodology to be used to arrive at their recommen­ dations for the allocations and these should be reviewed periodically; • the minimum entitlement arrangements should be maintained but with an upper limit of 30 per cent ofthe funds available; population would be the main criteria for calculating minimum entitlements but weightings for demographic characteristics could be considered; • a period of up to 3 years should be allowed to phase in the new arrange­ ments. 1.25 The recommendations also included a detailed listing of some twenty-six guidelines for the Commissions to follow in their allocations processes (see pages xxiv to xvi of the Report). The primary aim of the guidelines was to introduce a degree of uniformity between the respective State Grants Commissions in their allocations processes and to reinforce the use of objective fiscal equalisation procedures in the processes. Special arrangements were also proposed for Aboriginal communities where these were incorporated as local government. 1.26 The Self Committee Report recommendations were examined during the Conference of State Grants Commissions in Sydney in November 1985. The Chair­ man of the Commission also participated in a Forum organised by the Municipal Association of Victoria to discuss the ramifications ofthe Self Committee's recom­ mendations for local government in Victoria. The Forum was held on Tuesday, 10 December 1985, at Tullamarine. 1.27 Following the consideration of submissions from the States, local govern­ ment authorities and bodies representative of them and other interested bodies, the Commonwealth Minister for Local Government and Administrative Services, the Hon. Tom Uren, introduced legislation into the Commonwealth Parliament on 2May 1986 to repeal the Local Government (Personal Income Tax Sharing) Act 1976 and replace it with a new Act to provide for new arrangements for the continuation of general revenue funding for local government. The new Local Government (Financial Assistance) Act 1986 was passed by both Houses of the Parliament (with minor amendment in the House of Representatives) and came into effect on I July 1986.

5 THE LOCAL GOVERNMENT (FINANCIAL ASSISTANCE) ACT 1986 1.28 The new legislation provides the framework for the continuation ofgeneral revenue funding for local government by the Commonwealth. It provides for the continued role of the State Grants Commissions in recommending the allocation of the funds and lays down some broad guidelines for appointments to the respective commissions. The main provisions are summarised below: (i) For 1986-87 and 1987-88 the legislation provides for a real terms guarantee for the funding ofthe general revenue grants, but any increase in payments to the State Governments in these two years above a real terms increase will also be applied to the local government general revenue funding. For subsequent years, increases in local government general revenue fund­ ing will be tied to arrangements for payments to the States, which are to be reviewed in 1988. (ii) The inter-State apportionment of the total fund will be changed from the percentage shares laid down in the former Act (which have remained unal­ tered since 1977) to straight population shares. This change is to be phased in over a period of three years; this is provided for by schedules showing the proportionate shares that will determine the inter-State allocations for 1986-87, 1987-88 and 1988-89. The shares for 1989-90 onwards will be determined solely by reference to State populations. (iii) Each State is required to formulate principles for the allocation of the grants to local authorities and give a copy ofthese principles to the Commonwealth Minister by 1 July 1987. Ifa State fails to submit allocation principles to the Minister by that date, the Minister is empowered to formulate principles for the State to observe. There are also provisions to vary or revoke a set of principles. The Minister has until 1991 to approve the principles submitted by or formulated for a State, but may approve them for use in an earlier year, and a State may request the Minister that they have effect in an earlier year. In formulating the principles, a State is required to "consult with a body or bodies representative of local government in the State"' and to advise the Minister of the body or bodies that have been consulted. The Principles so formulated are to "have regard to the objective ofensuring that the allocation offunds for local government purposes is made, as far as practicable, on a full horizontal equalisation basis, being a basis that ensures that each local governing body in the State is able to function, by reasonable effort, at a standard not lower than the average standard of other local governing bodies in the State, and that takes account of differences in the expenditure required by those local governing bodies in the performance of their functions and in the capacity of those local governing bodies to raise revenue" (section 9(2)(b)). (iv) Notwithstanding these fiscal equalisation objectives, no local governing body shall be allocated an amount that is less than the amount that it would be entitled to if 30 per cent of the State's allocation was allocated on a per capita basis. This provision replaces the As-of-Right provision of the previous-legisla­ tion and confirms the Victoria Grants Commission's treatment of the previous As-of-Right entitlement as a base grant constraint. The option of weighting the minimum entitlement for area, sparsity, etc. has been removed. (v) The State Grants Commissions are to hold public hearings (whether or not the Commissions have held private hearings) and are to permit or require local governing bodies or associations of those bodies to make submissions to them in connection with the recommendations.

6 (vi) Each State Grants Commission is required to publish a report "at least once every 3 years ... setting out details ofthe methods used by that Commission in making its recommendations". Reports of the State Grants Commissions are to be tabled in each House of the Commonwealth Parliament within 15 sittings of their receipt by the Minister. (vii) The State Government is to have regard to or adopt the recommendations ofthe Grants Commission for allocating the amount to which it is entitled among the local governing bodies in the State and is to inform the Commonwealth Minister of the proposed allocations before they are made public. (viii) The payments are to be made as a lump sum payment to the State and the State is required to make the payments to the individual authorities as unconditional grants, without undue delay after the receipt of the lump sum. (ix) The Minister may instigate a review of the operation cfthe provisions ofthe Act after 30 June 1992. There are five broad areas for examination listed in the event of such a review being instigated. These are: (a) the effectiveness of the arrangements in attaining the fiscal equalisation objectives of section 9(2)(b); (b) the impact ofthe provisions on the raising of revenue by local governing bodies and on assistance provided by the States to local government; (c) the implications of any changes in functional responsibilities of local government; (d) the eligibility of assistance for bodies declared by the Minister, on the advice of the State Minister, to be a local governing body for purposes of the Act; (e) such other matters relating to local government as the Minister deter­ mines. 1.29 Minor amendments to the Victoria Grants Commission Act 1976 will be necessary to conform with the new Commonwealth Act.

IMPLICATIONS FOR VICTORIA 1.30 The membership of the Grants Commission and its operations generally conform with the requirements of the new Commonwealth legislation. However, several changes are required to fully comply with provisions of the Act. 1.31 The methodology used by the Commission to date has adhered closely to fiscal equalisation principles; this was acknowledged in the Self Committee's Report. The only change necessary to comply with the legislation is to adjust the revenue standard from the mean of the top 25 per cent of municipalities to the mean for the State as a whole. The effect of this will be to decrease the weight of the revenue needs component in the allocation procedures and increase the weight of the expenditure needs component. That is, those municipalities which have relatively high expendi­ ture needs will receive greater shares ofthe State's allocation and those with relatively low revenue needs will receive smaller shares. 1.32 The change to the As-of-Right or minimum entitlement calculation of itself will have little effect on the allocations. However it will reduce the minimum entitle­ ment threshold for all municipalities, particularly rural shires (because of the elimina­ tion ofthe area component). This, combined with the change to the revenue standard, could mean that for some municipalities their share ofthe allocations will be signifi­ cantly reduced over time. 1.33 The other implications of the Act are of a procedural nature. Consultations with a body or bodies representative oflocal government have to take place over the principles to be employed by the Commission for future allocations before the prin­ ciples are submitted forthe Commonwealth Minister's approval. Also, the discussion period with Councils and their officers will have to include a period which is open to the public.

7 4816(F11-2 1.34 The Act also requires the Commission to permit or require associations of local governing bodies, as well as local governing bodies, to make submissions to it about its recommendations. Previously, only local governing bodies were able to make submissions to the Commission about the allocations and the Commission's procedures. 1.35 The Commission has included in each of its Annual Reports a detailed outline of its principles and methodology. We have been assured that this standard of reporting conforms with the requirement to "publish a report setting out details of the methods used by (the) Commission in making its recommendations" at least once every three years.

CONFERENCE OF STATE GRANTS COMMISSIONS 1.36 The 1985 Conference of State Grants commissions was deferred until 6-8 November 1985 because of the late release of the Report of the Committee of the National Inquiry into Local Government Finance. This deferment meant that the Conference had to be transferred from Darwin to Sydney. 1.37 The Conference was attended by representatives of each of the six State Grants Commissions and the Grants Commission of the Northern Territory. Profes­ sor Peter Self, Chairman of the Committee of Inquiry and Mr John Nethercote (Secretary) also attended. The Office of Local Government, Department of Local Government and Administrative Services, was represented by Mr. Michael Gallagher (First Assistant Secretary). The attendance of these representatives provided the Commissions' representatives with valuable insight to the Self Committee's report and recommendations. The contribution from the Office of Local Government gave an indication of the Commonwealth's attitudes to the recommendations which was also invaluable. 1.38 The 1986 Conference has been rescheduled for Darwin in September 1986 and will concentrate on the principles and associated matters required to be adopted by the Grants Commissions in conformity with the new legislation.

OTHER MEETINGS, ETC. 1.39 • Seminar on the Self Committee's Report and Recommendations organ­ ised by the Municipal Association ofVictoria, at Melbourne, 10 Decem­ ber 1985. Attended by the Chairman and Members; paper presented by the Chairman on the Commission's preliminary assessment of the impli­ cations for local government in Victoria. • Outer Eastern Municipalities Association-Seminar on Local Govern­ ment Finance, Sherbrooke, 5 April 1986; paper presented by Chair­ man. • Rural Development Centre, University ofNew England-Conference on "Financing Rural Local Government in Uncertain Times", Armidale, N.S.W., 29-30 April 1986; paper presented by Chairman. • Conference of State and Northern Territory Grants Commissions with representatives of the Office of Local Government, Melbourne, I July 1986; discussions on implications of the Local Government (Financial Assistance) Act 1986. • Municipal Group of Valuers, Melbourne, 8 August 1986; address by Chairman on valuation and rating practices. 1.40 In addition, at the request of the Council, the Chairman attended a meeting of the Geelong City Council to discuss issues related to the City's general revenue allocation for 1985-86. 1.41 The Commission has also provided advice and assistance to the Depart­ ment of Local Government, other Departments and government bodies on various issues from time to time.

8 MEMBERS 1.42 Mrs. Dianne Fuller was appointed as a part-time Member of the Commis­ sion for the period commencing 2 December 1985 and ending 31 October 1988. Mrs. Fuller was a Councillor with the City ofFrankston for four years and Mayor ofthe City in 1984-85. She has the distinction of being the first woman appointed to a State Grants Commission and was the first woman elected as Mayor of the Frankston City Council. Mrs. Fuller's appointment fills the vacancy created by the resignation of the Hon. J. M. Walton on 31 January 1985. 1.43 The appointments of Mr. D. V. Moye, Chairman, and Mr. L. F. Cheffers, O.A.M., Member, expire on 31 October 1986.

STAFF 1.44 Mr. Michael U1brick was appointed Secretary of the Commission from 25 August 1986, following the transfer, on promotion, of Dr. W. A. Phillips to the Department of Management and Budget.

9 Chapter 2

THE BASES OF THE 1986-87 ALLOCATIONS 2.1 As mentioned in Chapter I (see paragraphs 1.28 - 1.29) the Common­ wealth's Local Government (Financial Assistance) Act 1986 requires the States to submit details of the principles to be employed by the respective State Grants Com­ missions in determining their recommendations for the allocation ofgeneral revenue grants for local government. The principles are to be submitted by I July 1987, that is they will apply to the recommendations for the 1987-88 allocations. For the 1986-87 allocations, the Act requires the State to conform with the methods used in determin­ ing the 1985-86 allocations, that is the principles and methods that applied in the Local Government (Personal Income Tax Sharing) Act 1976, unless the Minister, by agreement with the State, has agreed to modifications of the methods. 2.2 The new legislation was assented to on 24 June 1986, to take effect from I July 1986. This gave no opportunity to pursue the possibility of changes to the methodology used in previous years for the 1986-87 allocations, given the prior consultative and approval processes that have to be followed before changes can be implemented. Therefore the methodology used to determine the recommendations for the 1986-87 allocations is consistent with that used in previous years.

AS-OF-RIGHT ENTITLEMENT 2.3 The basis for determining the As-of-Right or minimum entitlements for 1986-87 was unchanged from previous years. That is, the entitlements were based on 40 per cent of the available amount, with 85 per cent calculated according to resident population and 15 per cent according to total area. 2.4 The population and area figures were taken from the publication of the Aus­ tralian Bureau of Statistics "Estimated Resident Population in Local Government Areas, Victoria, 30June 1983. 1984 and Preliminary /985"(Catalogue No. 3203.2). The resultant As-of-Right entitlement factors are: Population $12.181850 per head Area $39.012852 per square km. The allocations for two municipalities, the Shires of Rosedale and Walpeup, were determined by reference to their entitlements As-of-Right. 2.5 The new legislation requires future As-of-Right entitlements to be calcu­ lated on a straight population basis only, using 30 per cent of the funds available as the base. The legislation also makes it clear that the figures so calculated fix the minimum entitlement for each municipality only; that is, they play no part in determining fiscal equalisation entitlements. This removes any uncertainty about the treatment of the entitlement figures that existed previously and confirms the treatment afforded to them under the previous legislation by the Victoria Grants Commission.

HORIZONTAL EQUALISATION 2.6 As mentioned in paragraph 2.2, the 1986-87 allocations were determined by the use of the principles and methodology that had been applied to the determination of the 1985-86 allocations (see Annual Report 1985, Victoria Grants Commission, Chapter 2). The new legislation requires the allocations to be determined, as far as practicable, on a "full horizontal equalisation basis". This is expanded in the usual fiscal equalisation terminology that differs in one respect only from the terminology used in the former Act-the specifying of"average ... ofother local governing bodies in the State" as the standard for equalisation purposes. 2. 7 In practical terms the only significant change that the Victoria Grants Com­ mission would have to make to the methodology that it has used in past years, in order to conform with the new requirement, would be to change the standard for compari­ sons of revenue raising capacity from an arithmetic average (mean) of the top 25 per cent of municipalities, to an arithmetic average for the State as a whole. However, this

10 change could have a significant effect on the pattern of allocations. It will reduce the standard used to assess relative capacity to raise revenue and thus reduce allowances for differences in revenue raising capacity. There will be more (and larger) negative values for the revenue component and the positive values will be smaller than under the current methodology. Overall, allowances for revenue raising capacity will be of less significance in determining the allocations than hitherto and more emphasis will be placed on expenditure needs and disabilities. 2.8 On the expenditure side, the Commission has used modal values for deter­ mining standards. If values for the functions are normally distributed, modal values would approximate average values. The commission believes that modal values pro­ vide a better indication of most common levels ofexpenditure by councils because of the effects of heavily skewed distributions of values, which are commonplace for many functions, on arithmetic averages. The Commission will be arguing for the retention of the use of modal values(or the average ofthe modal range) forestablishing expenditure standards. However, if arithmetic averages are required to be used, the change from modal values to State averages should not greatly affect the relative allowances for expenditure needs and disabilities for most municipalities. 2.9 Clearly, the reduction in the weight of the revenue component and the increase in the weight afforded to the expenditure component will mean a shift in the pattern ofallocations. Municipalities whose allocations under the previous methodo­ logy were largely determined by the revenue component will find their allocations reduced. The level to which the allocations can fall is, of course, constrained by the As-of-Right or minimum entitlement figure. As this will fall relatively for all munici­ palities, because of the change to a per capita basis for calculating minimum entitle­ ments, and substantially for rural Shires, because of dropping the weighting for area from the calculation, there could be substantial decreases in allocations for some municipalities before the minimum entitlements come into play. 2.10 Of course, a concomitant of the decrease in the allocations for some muni­ cipalities is an increase in the allocations for others. The type of municipality most likely to benefit is one that has high expenditure needs and disabilities, coupled with positive revenue raising needs because of below standard capacity to raise revenue. 2.11 The legislation allows for a phasing in of the changes to methodology over the period to the year commencing I July 1991 (i.e., thenewprovisionshaveto be fully met for the 1991-92 allocations). Ifthe new basis that is laid down in the legislation for determining the allocations is perceived to be more equitable than the bases used to date by the respective State Grants Commissions, then it is arguable whether the phasing in period should extend over the full five year period. 2.12 The Commission's methodology has been extensively documented in pre­ vious Annual Reports. Because ofthe necessity to have the approval ofthe Common­ wealth Minister for the principles to be followed by the Commission for future allo­ cations, it would be inappropriate to reproduce the detailed methodology used in the past in this Report. Suffice to say the allocations determined for 1986-87 were based on the use of the methodology which was documented in the Commission's 1985 Annual Report.

LOCAL GOVERNMENT RESTRUCTURE 2.13 A number ofquestions have been raised about the effect ofthe restructure of local government in Victoria on the distribution of general revenue grants. In some cases quite misleading statements have been made by opponents of the restructure process, asserting that the overall allocations for an area would be substantially reduced following restructure. This is not a conclusion that can be drawn from the allocation procedures which have been documented in the Commission's Annual Reports and discussed with Councillors and Officers during the Commission's visits.

11 2.14 The allocations to the municipalities in the State are determined by the applica­ tion of fiscal equalisation principles (except for those municipalities where the As­ of-Right calculation comes into play). That is the allocations are determined by the inherent characteristics of the respective areas. The physical characteristics of areas are not, ofcourse, affected by the location of municipal boundaries, nor are the values of property. Demographic characteristics are also unaffected although there may be minor changes to the average figures for new areas, but such changes are unlikely to have a significant effect on allocations. 2.15 The Commission is confident that the allocation for any new municipal area should be approximately equal to the sum of the allocations that would have been made for the former parts. This must be so in the wider context because whatever the number of municipalities in a State, the sum of the allocations for each municipality must equal the total amount for the State. 2.16 The question has also been raised as to the timing of changes to allocations following a restructure. The critical factor is the availability of data. For situations where restructure is a straightforward amalgamation of two or more existing areas, this should present no problem and the Commission should be able to determine an allocation for the new municipality for the financial year for which the change takes effect. For situations where restructure takes the form of a severance of a part of a municipality for addition to another, the availability of data relating to the severance area will be critical in determining the allocations for the altered municipal areas. However, the Commission accepts that it would be desirable for it to determine the allocations for the financial year in which the changes are to take effect on the basis of the new boundaries, if at all possible. 2.17 A further consideration is the treatment of once-off costs following restruc­ ture. The Commission would be prepared to consider submissions regarding these establishment costs (costs associated with changes to records, stationery and other costs directly attributable to the restructure) in the light of hard evidence of their effect on the finances of the new municipality. 2.18 The commission would welcome comments on these issues or any other issue directly related to costs involved in the implementation of any restructure proposals.

ACKNOWLEDGEMENTS The Commission acknowledges the continued close working relationship with the Staff of the Victorian Office of the Australian Bureau ofStatistics, particularly the Finance and Distribution Branch, and the considerable assistance they have given in the preparation of the Annual Returns oflnformation and the provision of essential data. The Valuer-General's Office has continued to assist with information on property valuations and with the updating ofvaluations for each of the municipalities in the State. We also acknowledge the help and support of the Commission's staffduring what has proved to be a demanding period and particularly the role played by Dr. Bill Phillips during his period with the Commission in the development of the Commis­ sion's computer based data system.

12 APPENDIX I

VICTORIA GRANTS COMMISSION

DETERMINATION OF ALLOCATIONS OF GENERAL REVENUE GRANTS (INCLUDING SUPPLEMENTARY ALLOCATIONS) TO Mt:NICIPAL COt:NCILS IN VICTORIA -1985-86 FINANCIAL YEAR

Additional General Special General Equalisation Factor Revenue Total Jfunicipa/ity Grant Allocation Grant Allocation ($) ($) ($) ($) Alberton (S)...... 587,000 16,150 1,095 604,245 Alexandra (S) 414,000 771 414,771 Altona (C)...... 612,000 1,142 613.142 Arapi1es (S)...... 178,000 331 178,331 Ararat (C)...... 472,000 880 472,880 Ararat (S) ...... 517,000 964 517,964 Avoca (S) 291,000 1,350 542 292,892 Avon (S) ...... 273,000 509 273,509 Bacchus Marsh (S) 414,000 19,250 771 434,021 Baimsdale (S) ...... 472,000 880 472,880 Baimsdale (T) .. .. 543,000 10,103 544,013 Ballaarat (C) ...... 1,660,000 3,096 1,663,096 Ballan (S) ...... 22LOOO 23,000 412 244,412 Ballarat (S) ...... 818,000 1,526 819,526 Bannockbum (S) . 203,000 378 203,378 Barrabool (S) .. 322,000 6,400 600 329,000 Bass (S) ...... 380,000 708 380,708 Beechworth (S) 336,000 626 336.626 Belfast (S) ...... 117,000 218 117,218 Bellarine (S) ...... 1,110,000 2,070 1,112,070 Benalla (C)...... 420,000 783 420,783 Benalla (S) ...... 234,000 2,150 436 236,586 (C). 1,510,000 2,816 1,512,816 Berwick (C). 1,145,000 2,135 1,147,135 Bet Bet (S)...... 237,000 35,000 441 272,441 Birchip (S) .. 150,000 279 150,279 Box Hill (C) ...... 1,084,000 2,022 1,086,022 Bright (S) ...... 465,000 867 465,867 Brighton (C) ...... 420,000 783 420,783 Broad ford (S) ...... 188,000 350 188,350 Broadmeadows (C) 2,864,000 5,339 2,869,339 Brunswick (C). 1,476,000 2,752 1,478,752 Bulla (S) ...... 578,000 17,400 1,078 596,478 Buln Buln (S) ...... 620,000 26,850 1,157 648,007 Bungaree (S) .... . 174.000 324 174,324 Buninyong (S) ...... 510,000 951 510,951 Camberwell (C) ...... 1,445,000 2,695 1,447,695 Camperdown (T) ...... 210,000 391 210,391 Castlemaine (C) 453,000 844 453,844 Caulfield (C) 1,397,000 2,605 1,399,605 Charlton (S) ...... 177,000 330 177,330 Chelsea (C) 1,070,000 1,996 1,071,996 Chiltern (S) ...... 136,000 253 136,253

13 APPENDIX I -continued Additional General Special General Equalisation Factor Revenue Total Afunicipality Grant Allocation Grant Allocation

Cobram (S) 397,000 740 397,740 Coburg (C) ...... ,,,,.,,,,,,,,,.,, 1,686,000 3,143 1,689,143 Cohuna (S) ...... 295,000 8,200 550 303,750 Colac (C) ...... 470,000 876 470,876 Co1ac (S)...... 450,000 839 450,839 Collingwood (C) ...... 715,000 1,334 716,334 Corio (S) •••••••...... ,,,, .... 1,315,000 2,452 1,317,452 Cranbourne (S) ...... 1,099,000 2,050 1,101,050 Creswick (S) ...... 350,000 652 350,652 Croydon (C)...... 1,075,000 2,005 1,077,005 Dandenong (C) ...... 1,300,000 2,423 1,302,423 Daylesford & Glenlyon (S) ... 507,000 946 507,946 Deakin (S) ,,,,.,,,,, ...... ,...... 524,000 35,000 978 559,978 Diamond Valley (S) ...... 1,312,000 2,447 1,314,447 Dimboola (S) ...... ,,,, ...... 438,000 816 438,816 Donald (S) ...... , .. 250,000 466 250,466 Doncaster & Templestowe (C) /1,590,000 2,965 1,592,965 Dundas (S) ...... 244,000 454 244,454 Dunmunkle (S) ...... ,,.,,,,,.,,, ..... 276,000 514 276,514 Eaglehawk (B) ... 398,000 742 398,742 East Loddon (S) 178,000 18,500 331 196,831 Echuca (C) 396,000 738 396,738 Eltham (S) ...... , . .,,,,,,, ... .,,,,, 1,087,000 2,027 1,089,027 Essendon (C) ...... 1,496,000 2,789 1,498,789 Euroa (S) ...... 303,000 564 303,564 Fitzroy (C) ...... 793,000 1,479 794,479 Flinders (S) ...... 743,000 1,386 744,386 Footscray (C) ...... 2,030,000 3,784 2,033,784 Frankston (C) ...... 1,756,000 3,274 1,759,274 Geelong (C) ...... 496,000 925 496,925 Geelong West (C) ...... 563,000 1,050 564,050 Gisborne (S)...... -- 345,000 24,950 643 370,593 G1enelg (S) 507,000 946 507,946 Gordon (S) ...... 307,000 9,850 572 317,422 Goulburn (S) ...... J.70,000 317 170,317 Grenville (S) ...... ,,,,, ...... , ...... 268,000 499 268,499 Hamilton (C)...... 530,000 989 530,989 Hampden (S). 525,000 979 525,979 Hastings (S) ...... 391,000 729 391,729 Hawthorn (C) ,,,,,...... 482,000 898 482,898 Healesville (S) ...... 547,000 1,020 548,020 Heidelberg (C) ...... 1,637,000 3,053 1,640,053 Heytesbury (S) 687,000 1,281 688,281 Horsham (C) 705,000 1,315 706,315 Huntly (S) 202,000 4,100 376 206,476 Kaniva(S) 225,000 419 225,419 Kara Kara (S) ...... , ...... 155,000 19,000 289 174,289 Karkarooc (S) 407,000 758 407,758 Keilor(C) 2,215,000 4,130 2,219,130 Kerang (B) .•.• ...... 237,000 441 237,441 Kerang (S) ...... 438,000 35,000 816 473,816

14 APPENDIX !-continued Additional General Special General Equalisation Factor Revenue Total Municipality Grant Allocation Grant Allocation ($) ($) ($) ($) Kew (C) ...... 477,000 889 477,889 Kilmore (S) ...... 290,000 540 290,540 Knox (C) ...... 1,900,000 3,543 1,903,543 Korong (S) ...... 417,000 35,000 777 452,777 (S) ...... 538,000 1,004 539,004 Kowree (S) ...... 382,000 712 382,712 Kyabram (T) ...... 283,000 527 283,527 (S) ...... 460,000 857 460,857 Leigh (S) ...... 153,000 285 153,285 Lexton (S) ...... 96,000 179 96,179 Lillydale (S) ...... 1,771,000 54,830 3,303 1,829,133 Lowan (S) ...... 310,000 578 310,578 Mclvor (S) ...... 190,000 354 190,354 Maffra (S) ...... 625,000 1,166 626,166 Maldon (S) ...... 210,000 391 210,391 Malvern (C) ...... 743,000 1,386 744,386 Mansfield (S) ...... 457,000 852 457,852 Marong (S) ...... 500,000 933 500,933 Maryborough (C) ...... 446,000 831 446,831 Melbourne (C) ...... 2,288,000 4,266 2,292,266 Melton (S) ...... 813,000 1,516 814,516 Metcalfe (S) ...... 188,000 350 188,350 Mildura (C) ...... 760,000 1,418 761,418 Mildura (S) ...... 1,230,000 2,294 1,232,294 Minhamite (S) ...... 244,000 454 244,454 Mirboo (S) ...... 158,000 294 158,294 Moe (C) ...... 790,000 1,473 791,473 Moorabbin (C) ...... 1,345,000 2,508 1,347,508 Mordialloc (C) ...... 767,000 1,431 768,431 Mornington (S) ...... 605,000 1,129 606,129 Mortlake (S) ...... 265,000 494 265,494 Morwell (S) ...... 1,200,000 2,238 1,202,238 Mount Rouse (S) ...... 177,000 330 177,330 Myrtleford (S) ...... 285,000 531 285,531 Narracan (S) ...... 690,000 1,287 691,287 Nathalia (S) ...... 271,000 15,800 505 287,305 Newham & Woodend (S) ...... 236,000 16,900 440 253,340 Newstead (S) ...... 168,000 313 168,313 Newtown (C) ...... 370,000 689 370,689 Northcote (C) ...... 1,744,000 3,252 1,747,252 Numurkah (S) ...... 410,000 764 410,764 Nunawading (C) ...... 1,645,000 3,068 1,648,068 Oakleigh (C) ...... 1,042,000 1,943 1,043,943 Omeo (S) ...... 246,000 458 246,458 Orbost (S) ...... 648,000 1,209 649,209 Otway (S) ...... 512,000 22,050 955 535,005 Oxley (S) ...... 296,000 551 296,551 Pakenham (S) ...... 868,000 25,740 1,619 895,359 Phillip Island (S) ...... 440,000 820 440,820 (B) ...... 192,000 358 192,358 Port Melbourne (C) ...... 246,000 458 246,458

15 APPENDIX I -continued Additional General Special General Equalisation Factor Revenue Total Municipality Grant Allocation Grant Allocation ($) ($) ($) ($) Portland (C) ...... 547,000 1,020 548,020 Portland (S) ...... 682,000 1,272 683,272 Prahran (C) ...... 783,000 1,460 784,460 Preston (C) ...... 2,077,000 3,873 2,080,873 Pyalong (S) ...... 41,000 76 41,076 Queenscliffe (B) ...... 160,000 298 160,298 Richmond (C) ...... 790,000 1,473 791,473 Ringwood (C) ...... 902,000 1,682 903,682 Ripon (S) ...... 279,000 520 279,520 Rochester (S) ...... 550,000 1,026 551,026 Rodney (S) ...... 723,000 13,850 1,349 738,199 Romsey (S) ...... 217,000 404 217,404 Rosedale (S) ...... 163,000 303 163,303 Rutherglen (S) ...... 206,000 384 206,384 St Amaud (T) ...... 215,000 4,100 400 219,500 St Kilda (C) ...... 1,307,000 2,437 1,309,437 Sale (C) ...... 652,000 1,216 653,216 Sandringham (C) ...... 542,000 1,011 543,011 Sebastopo1 (B) ...... 336,000 626 336,626 Seymour (S) ...... 514,000 959 514,959 Shepparton (C) ...... 888,000 1,656 889,656 Shepparton (S) ...... 502,000 937 502,937 Sherbrooke (S) ...... 1,236,000 2,305 1,238,305 South Barwon (C) ...... 1,225,000 2,285 1,227,285 South Gipps1and (S) ...... 538,000 12,100 1,004 551,104 South Melbourne (C) ...... 340,000 633 340,633 Springvale (C) ...... 1,594,000 2,973 1,596,973 Stawell (S) ...... 286,000 29,650 533 316,183 Stawell (T) ...... 412,000 768 412,768 Strathfie1dsaye (S) ...... 506,000 10,500 944 517,444 Sunshine (C) ...... 2,950,000 5,501 2,955,501 Swan Hill (C) ...... 506,000 944 506,944 Swan Hill (S) ...... 868,000 1,619 869,619 Tal bot & Clunes (S) ...... 222,000 413 222,413 Tallangatta (S) ...... 371,000 24,600 691 396,291 Tambo (S) ...... 640,000 1,194 641,194 Traralgon (C) ...... 855,000 1,595 856,595 Traralgon (S) ...... 134,000 9,350 249 143,599 Tullaroop (S) ...... 178,000 331 178,331 Tungamah (S) ...... 272,000 2,004 507 274,511 Upper Murray (S) ...... 275,000 512 275,512 Upper Yarra (S) ...... 545,000 1,017 546,017 Violet Town (S) ...... 130,000 242 130,242 Walpeup (S) ...... 431,000 803 431,803 Wangaratta (C) ...... 770,000 1,436 771,436 Wangaratta (S) ...... 144,000 2,500 268 146,768 Wannon (S) ...... 326,000 607 326,607 Waranga (S) ...... 494,000 922 494,922 Warracknabeal (S) ...... 326,000 607 326,607 Warragul (S) ...... 484,000 11,100 903 496,003 Warrnambool (C) ...... 1,064,000 1,984 1,065,984

16 APPENDIX 1-continued Additional General Special General Equalisation Factor Revenue Total Municipality Grant Allocation Grant Allocation ($) Warrnambool (S) ...... 590,000 1,101 591,101 Waver1ey (C) ...... 1,596,000 2,976 1,598,976 Werribee (S) ...... ,,,,,, ...... 1,450,000 35,000 2,704 1,487,704 Whittlesea (S) ...... 1,670,000 3,114 1,673,114 Williamstown (C) ...... 1,054,000 1,966 1,055,966 Wimmera (S) ...... 316,000 25,500 589 342,089 Winchelsea (S) ...... 414,000 7,900 771 422,671 Wodonga (C) ...... 867,000 1,617 868,617 Wonthaggi (8) ...... 436,000 7,110 812 443,922 Woorayl (S) ...... 750,000 1,398 751,398 Wycheproof (S) ...... 482,000 898 482,898 Yackandandah (S) ...... 233,000 3,900 434 237,334 Yarrawonga (S) ...... 338,000 630 338,630 Yea ...... 290,000 540 290,540 TOTAL ...... 135,486,000 671,634

17 APPENDIX 11 VICTORIA GRANTS COMMISSION

The Hon. J. L. Simmonds, M.P., Minister for Local Government 480 Collins Street, · MELBOURNE, VIC. 3000. Victoria Grants Commission Act 1976- Determination of Allocations of General Revenue Assistance for 1986-87 to Municipal Councils in Victoria In accordance with the provisions of the Victoria Grants Commission Act 1976, we have pleasure in submitting to you the Determination of allocations of general revenue grants to municipal Councils in Victoria for the 1986-87 financial year, from funds made available under the Commonwealth's Local Government (Financial Assistance) Act 1986. · The Local Government (Financial Assistance) Act 1986, which was enacted during the Autumn 1986 Session of the Commonwealth Parliament, repealed the Local Government (Personal Income Tax Sharing) Act 1976 and provided for a new basis for determining the amount to be made available by the Commonwealth Government as general revenue grants for local government. For 1986-87 and 1987-88, the amount is to be determined by taking the amount provided in the previous year and increasing it in accordance with movements in the Consumer Price Index for the 12 months period ending the March quarter compared with the previous 12 months period, or in accordance with the increase in general purpose payments to the States (financial assistance grants, identified health grants and general purpose capital assistance pay­ ments) for the relevant period, whichever is the greater. For subsequent years the increase in payments is to be based on the percentage change to Commonwealth general purpose payments to the States. The Commonwealth Treasurer's estimate of the movement in the Consumer Price Index for the 12 months ending March 1987is8.25 percent. The baseamount,as provided for in the legislation, is $540,982,049; this includes an amount for the Northern Territory which has been brought within the ambit ofthe new arrangements. The application of the estimated Consumer Price Index to the base amount provides an amount of$585,613,068. The new legislation also provides for change to the basis for determining the shares ofthe States and the Northern Territory, from the percentage shares which have stood since 1977, to population shares. This change is to be phased in over the three years to 1988-89; the proportionate shares for the three-year change-over period are given in tables in the legislation. For 1986-87, Victoria's proportiOn is 25.2153 per cent or $14 7 ,664,092. This is an increase of8.25 per cent over the amount provided for 1985-86. Because of the change to population shares, Victoria's share of the total amount will increase relatively in the next two years. The Local Government (Financial Assistance) Act 1986 also requires the States and the Northern Territory to develop principles for determining the allocations, consistent with the basic principles laid down in the legislation. However, the Com­ monwealth acknowledges that the development of these principles could take some time and, therefore, the legislation requires the respective State Grants Commissions to adhere to the methods used under the preceding Local Government (Personal Income Tax Sharing) Act 1976, unless prior agreement to change these methods had been reached between the responsible State Minister and the Commonwealth Minister. The Commission has been advised by the Office of Local Government, Department ofLocal Government and Administrative Services, that adherence to the methods used in previous years applies to the basis for determining the minimum or As-of-Right entitlements, as well as to the bases for determining the allocations gen­ erally.

18 As the new legislation only came into effect on I July 1986, it was not possible to contemplate any change to the methodology for determining the 1986-87 allocations. Therefore, the amount of$147 ,664,092 has been allocated among the 210 municipal­ ities in the State in accordance with the provisions of the Local Government (Personal Income Tax Sharing) Act 1976 and the Victoria Grants Commission Act 1976 which complements it. That is to say, the Commission has followed the equalisation prin­ ciples and methodology described in its Annual Reports, giving consideration to the revenue and expenditure needs ofeach municipality and the cost disabilities encoun­ tered by each in providing municipal services, and to the effort made to function effectively and provide services at a reasonable standard. Special factor allowances have been made for the effects of natural disasters upon the operations ofa number of municipal Councils throughout the State. These allow­ ances, which are equal to the net cost of approved relief and restoration measures, amount to $322,392 and are identified in the Determination. These special factor allowances are equal to the approved net cost of relief and restoration measures incurred by the respective municipalities in the review period. The allocation for each municipality is not less than its entitlement As-of-Right. The As-of-Right entitlements have been calculated by taking 40 per cent of the total amount for the State and allocating this on the basis of population, 85 per cent, and area, 15 per cent. The relevant figures for calculating the 1986-87 As-of-Right entitle­ ments are: Population $12.1818 per head Area $39.0128 per square kilometre. The allocations for two municipalities, the Shires of Rosedale and Walpeup, were determined by reference to their respective entitlements As-of-Right. The Commission has emphasised in its Annual Reports the volatile nature of some of the elements upon which the allocations are based, in particular expenditure on roadworks and the relative cost characteristics of such works. Variations in these factors from year to year can significantly affect the allocations for individual muni­ cipalities, especially rural municipalities whose expenditures are heavily dominated by roadworks. Also, the relative strength of property values in the respective areas influences the size of the allocations through the measurement of capacity to raise revenue. A further forty-two municipalities have been visited since the last allocations were announced. This completed the five-year programme of visiting each munici­ pality in the State for inspections and discussions with Councillors and Officers on matters relevant to the Commission's role. The Commission has visited each muni­ cipality at least three times since its establishment in May 1977. We remain indebted to the Councillors and staff of all municipalities for the assistance given to the Commission throughout the year, especially to those represent­ ing the municipalities in which inspections were undertaken. The continued co­ operation and assistance of the Australian Bureau of Statistics in providing essential statistical information is gratefully acknowledged. We also acknowledge the support of the Local Government Department and the assistance of the Valuer-General's Office in providing detailed information about movements in valuations for each municipality. The contribution of the Commission's staff in the provision of support services is similarly gratefully acknowledged.

D. V. MOYE, Chairman

L. F. CHEFFERS, Member

M. A. ULBRICK, Secretary D. M. FULLER, Member

28 August 1986 19 APPENDIX 11 -continued

VICTORIA GRANTS COMMISSION

DETERMINATION OF ALLOCATIONS OF GENERAL REVENUE GRANTS TO MUNICIPAL COUNCILS IN VICTORIA -1986-87 FINANCIAL YEAR

General Special Equalisation Factor Total Allocation Allocation Allocation Municipality ($) ($) ($) Alberton Shire ...... 625,000 625,000 Alexandra Shire...... 465,000 465,000 Altona City ...... 655,000 655,000 Arapiles Shire ...... 188,000 188,000 Ararat City...... 510,000 510,000 Ararat Shire ...... 527,000 527,000 A voca Shire ...... 314,000 314,000 Avon Shire...... 293,000 293,000 Bacchus Marsh Shire ...... 459,000 14,270 473,270 Baimsdale Shire ...... 522,000 17,152 539,152 Baimsdale Town ...... 592,000 592,000 Ballaarat City ...... 1,807,000 1,807,000 Ballan Shire ...... 249,000 8,330 257,330 Ballarat Shire...... 900,000 900,000 Bannockbum Shire ...... 230,000 230,000 Barrabool Shire...... 380,000 380,000 Bass Shire ...... 425,000 425,000 Beech worth Shire ...... 360,000 360,000 Belfast Shire ...... 120,000 120,000 Bellarine Shire ...... 1,296,000 1,296,000 Benalla City ...... 454,000 454,000 Benalla Shire ...... 254,000 254,000 Bendigo City ...... 1,650,000 1,650,000 Berwick City ...... 1,303,000 1,303,000 Bet Bet Shire ...... 230,000 230,000 Birchip Shire ...... 160,000 160,000 1,133,000 1,133,000 ~ri~~~hYr~~.:::::::::::::::::::::::::::::::::::::::::::::::: 502,000 502,000 Brighton City ...... 447,000 447,000 Broadford Shire ...... 213,000 213,000 Broadmeadows City ...... 3,081,000 3,081,000 Brunswick City ...... 1,554,000 1,554,000 Bulla Shire...... 688,000 688,000 Buln Buln Shire ...... 673,000 22,565 695,565 Bun$3-ree Shire ...... 183,000 183,000 Bunmyong Shire ...... 562,000 562,000 Camberwell City ...... 1,560,000 1,560,000 Camperdown Town ...... 228,000 228,000 Castlemaine City ...... 510,000 510,000 Caulfield City ...... 1,496,000 1,496,000 Char1ton Shire ...... 191,000 191,000 Chelsea City ...... 1,158,000 1,158,000 Chi! tern Shire...... 145,000 145,000 Cobram Shire ...... 427,000 427,000 Coburg City ...... 1,800,000 1,800,000

20 APPENDIX II-continued General Special Equalisation Factor Total Allocation Allocation Allocation Municipality ($) ($) ($) Cohuna Shire ...... 320,000 285 320,285 Colac City ...... 520,000 520,000 Colac Shire ...... 485,000 485,000 Collingwood City ...... :...... 737,000 737,000 Corio Shire ...... 1,450,000 1,450,000 Cranbourne Shire ...... 1,269,000 21,875 1,290,875 Creswick Shire ...... 380,000 380,000 Croydon City ...... 1,167,000 1,167,000 Dandenong City ...... 1,416,000 1,416,000 Daylesford and Glenlyon Shire ...... 568,000 568,000 Deakin Shire ...... 558,000 558,000 Diamond Valley Shire ...... 1,418,000 1,418,000 Dimboola Shire ...... 440,000 440,000 Donald Shire ...... 266,000 266,000 Doncaster and Templestowe City .. . 1,748,000 1,748,000 Dundas Shire ...... 265,000 265,000 Dunmunkle Shire ...... 294,000 294,000 Eaglehawk Borough ...... 443,000 443,000 East Loddon Shire ...... 183,000 5,350 188,350 Echuca City ...... 426,000 426,000 Eltham Shire ...... 1,226,000 1,226,000 Essendon City ...... 1,630,000 1,630,000 Euroa Shire ...... 339,000 339,000 Fitzroy City ...... 800,000 800,000 Flinders Shire ...... 863,000 863,000 Footscray City ...... 2,156,000 2,156,000 Frankston City ...... 1,970,000 1,970,000 Geelong City ...... 535,000 535,000 Geelong West City ...... 620,000 620,000 Gisborne Shire ...... 394,000 394,000 Glene1g Shire ...... 550,000 550,000 Gordon Shire ...... 323,000 323,000 Goulburn Shire ...... 178,000 178,000 Grenville Shire ...... 300,000 300,000 Hamilton City ...... 560,000 560,000 Hampden Shire ...... 555,000 555,000 Hastings Shire ...... 454,000 454,000 Hawthorn City ...... 519,000 519,000 Healesville Shire ...... 590,000 590,000 Heidelberg City...... 1,725,000 1,725,000 Heytesbury Shire ...... 720,000 720,000 Horsham City ...... 770,000 770,000 Huntly Shire ...... 212,000 212,000 Kaniva Shire ...... 230,000 230,000 Kara Kara Shire ...... 168,000 168,000 Karkarooc Shire ...... 440,000 7,500 447,500 Keilor City ...... 2,491,000 2,491,000 Kerang Borough ...... 246,000 246,000 Kerang Shire ...... 475,000 475,000 KewCity ...... 518,000 518,000 Kilmore Shire ...... 325,000 325,000

21 APPENDIX 11-continued Special Equalisation Factor Total Allocation Allocation Allocation Municipality ($) ($) {$) Knox City ...... 2,123,000 2,123,000 Korong Shire ...... 450,000 450,000 Korumburra Shire ...... 587,000 14,750 601,750 Kowree Shire ...... 410,000 410,000 Kyabram Town ...... 312,000 312,000 Kyneton Shire ...... 510,000 510,000 Leigh Shire ...... 160,000 160,000 Lex ton Shire ...... 96,000 96,000 Li1ydale Shire ...... 1,991,000 19,570 2,010,570 Lowan Shire ...... 335,000 335,000 MclvorShire ...... 210,000 210,000 Maffra Shire...... 670,000 670,000 Ma1don Shire...... 239,000 239,000 Malvern City ...... 793,000 793,000 Mansfield Shire ...... 490,000 490,000 Marong Shire ...... 548,000 548,000 Maryborough City ...... 508,000 508,000 Melbourne City...... 2,520,000 2,520,000 Melton Shire ...... 947,000 35,000 982,000 Metcalfe Shire...... 206,000 206,000 Mildura City ...... 848,000 848,000 Mildura Shire ...... 1,327,000 1,327,000 Minhamite Shire ...... 240,000 240,000 Mirboo Shire ...... 166,000 166,000 Moe City ...... 888,000 888,000 Moorabbin City ...... 1,460,000 1,460,000 Mordialloc City ...... 840,000 840,000 Mornington Shire ...... 685,000 685,000 Mort1ake Shire ...... 285,000 285,000 Morwell Shire ...... 1,319,000 1,319,000 Mount Rouse Shire ...... 188,000 188,000 Myrtleford Shire ...... 295,000 295,000 Narracan Shire...... 740,000 740,000 Nathalia Shire ...... 288,000 288,000 Newham & Woodend Shire ...... 265,000 265,000 Newstead Shire ...... 190,000 190,000 Newton City ...... 421,000 421,000 Northcote ...... 1,850,000 1,850,000 Numurkah Shire ...... 441,000 441,000 Nunawading City ...... 1,770,000 1,770,000 Oak1eigh City ...... 1,130,000 1,130,000 Omeo Shire ...... 254,000 254,000 Orbost Shire ...... 695,000 15,515 710,515 Otway Shire ...... 500,000 500,000 Oxley Shire ...... 316,000 316,000 Pakenham Shire ...... 963,000 963,000 Phillip Island Shire ...... 488,000 488,000 Port Fairy Borough ...... 204,000 204,000 Port Melbourne City ...... 240,000 240,000 Portland City ...... 451,000 451,000 Portland Shire ...... 744,000 744,000

22 APPENDIX II-continued General Special Equalisation Factor Total Allocation Allocation Allocation ($) ($) ($) Prahran City ...... 784,000 784,000 Preston City...... 2,285,000 2,285,000 Pyalong Shire ...... 46,000 46,000 Queenscliffe Borough ...... 173,000 173,000 Richmond City ...... 850,000 850,000 Ringwood City ...... 990,000 990,000 Ripon Shire ...... 302,000 302,000 Rochester Shire ...... 590,000 590,000 Rodney Shire ...... 771,000 21,150 792,150 Romsey Shire ...... 245,000 245,000 Rosedale Shire...... 182,000 182,000 Rutherglen Shire .. 222,000 222,000 St. Arnaud Town ...... 231,000 231,000 St. Kilda City ...... 1,400,000 1,400,000 Sale City ...... 680,000 680,000 Sandringham City ... 574,000 574,000 Sebastopol Borough ...... 376,000 376,000 Seymour Shire ...... 562,000 562,000 Shepparton City ...... 1,005,000 1,005,000 Shepparton Shire...... 530,000 530,000 Sherbrooke Shire ...... 1,360,000 1,360,000 South Barwon City ...... 1,380,000 1,380,000 ...... 589,000 589,000 South Melbourne City ...... 345,000 345,000 Springvale City ...... 1,766,000 1,766,000 Stawell Shire...... 305,000 7,765 312,765 Stawell Town...... 448,000 448,000 Strathfieldsaye Shire...... 561,000 10,050 571,050 Sunshine City ...... 3,166,000 3,166,000 Swan Hill City ...... 540,000 540,000 Swan Hill Shire ...... 942,000 942,000 Tal bot & Clunes Shire ...... 240,000 18,850 258,850 Tallangatta Shire ...... 399,000 399,000 Tambo Shire. 705,000 21,860 726,860 Traralgon City ...... 930,000 930,000 Traralgon Shire 140,000 1,250 141,250 Tullaroop Shire ...... 197,000 197,000 Tungamah Shire ...... 290,000 290,000 Upper Murray Shire 293,000 293,000 Upper Yarra Shire ...... 648,700 10,285 658,985 Violet Town Shire ...... 134,000 14,425 148,425 Walpeup Shire...... 467,000 467,000 Wangaratta City ...... 830,000 830,000 Wangaratta Shire ...... 151,000 151,000 Wannon Shire 335,000 335,000 Waranga Shire...... 530,000 530,000 Warracknabeal Shire ...... 346,000 346,000 Warragul Shire ...... 529,000 529,000 Warrnambool City ...... 1,145,000 1,145,000 Warrnambool Shire ...... 645,000 645,000 Waverley City...... 1,733,000 1,733,000

23 APPENDIX II-continued General Special Equalisation Factor Total Allocation Allocation Allocation ($) ($) Werribee Shire...... 1,630,000 3,210 1,633,210 Whittlesea Shire...... 1,898,000 1,898,000 Williamstown City...... 1,098,000 1,098,000 Wimmera Shire...... 338,000 338,000 Winchelsea Shire...... 445,000 445,000 Wodonga City...... 930,000 21,600 951 ,600 Wonthaggi Borough...... 480,000 480,000 Wooray1 Shire...... 835,000 835,000 WycheproofShire...... 512,000 512,000 Yackandandah Shire...... 251,000 9,785 260,785 Yarrawonga Shire...... 368,000 368,000 Yea Shire...... 319,000 319,000 TOTAL...... 14 7,341, 700 322,392 147,664,092

D. V. MOYE, Chairman

L. F. CHEFFERS, Member

D. M. FULLER, Member

24 APPENDIX Ill

MUNICIPALITIES INSPECTED 1985-86

Date Municipality 1985 26 November...... Town ofStawell 27 November...... 28 November...... Shire ofRipon 3 December ...... Shire ofPort1and 4-5 December ...... City of Portland 11 December...... Shire ofBannockburn 12 December...... Shire ofWinchelsea

1986 21 January ...... Borough ofKerang 22 January...... 23 January ...... Shire ofGoulburn 4 February ...... Shire ofMarong 5 February ...... Shire ofHuntly 6 February ...... Borough ofEaglehawk 11 February...... City ofDandenong 12 February...... 13 February...... City of Croydon 25 February ...... Shire ofWaranga 26 February ...... Shire ofMclvor 27 February ...... Shire ofPyalong 12 March...... 13 March...... 14 March...... Shire ofLeigh 20 March ...... Shire ofPakenham 21 March ...... Shire ofCranbourne 8 April...... 9 ApriL...... Shire ofNewham & Woodend 10 April ...... Shire ofGisborne 15 April...... Shire of Diamond Valley 16 April ...... City ofBroadmeadows 22 ApriL ...... Shire ofGrenville 23 ApriL ...... Shire ofBuninyong 24 ApriL...... 13 May...... 14 May ...... Shire ofNarracan 15 May...... 27 May...... Shire of Tal bot & Clunes 28 May...... Shire ofCreswick 29 May...... Shire of Metcalfe 3 June ...... Shire ofBulla 4 June...... Shire ofWhittlesea 5 June...... Shire ofEltham

25 APPENDIX IV

DISTRIBUTION OF RATEABLE PROPERTY, RATE INCOME, RATING AND POPULATION

1975-76 to 1984-85

I. The values of rateable property have been derived from Valuer General estimates of rateable property at the beginning of the local government financial year-! October. In this respect they differ from the figures used by the Common­ wealth Grants Commission which were those applying at the end of the financial year. 2. Statistics for rate income were derived from the "Return of Accounting and General Information" for the relevant financial year. The figures are a revision of the preliminary estimates presented in previous Reports. 3. Population figures for 197 5-76 to 1979-80 have been derived from the revised annual estimates of population published by the Australian Bureau ofStatistics based on the results ofthe 1976 Census. Figures for 1980-81 are based on resident population data collected in the 1981 Census and detailed in the Bureau's Catalogue Number 3201.2 dated 17 June 1982. Figures for 1982-83, 1983-84 and 1984-85 have been derived from revised estimates of resident population (catalogue number 3203.2 dated 25 March 1986) which are based on the results of the 1981 Census. 4. Due to changes in the categorisation of municipalities the figures presented below differ from the corresponding figures appearing in Reports prior to 1979. 5. Minor discrepancies between figures may occur in some instances due to rounding.

Year Rateable Implied Population (1 October- Property Rate Income Rate in at 30 September) NAV $(cents) 30June $m $per head $m $per head

METROPOLITAN MUNICIPALITIES 1975-76 ...... 1800.0 769.49 157.5 70.41 9.2 2,339,200 1976-77 ...... 2250.1 963.10 174.7 76.43 7.9 2,336,300 1977-78 ...... 2334.0 999.76 197.7 84.73 8.5 2,334,500 1978-79 ...... 2361.5 1007.98 214.4 91.51 9.1 2,342,800 1979-80 ...... 2527.1 1077.52 238.6 101.74 9.4 2,345,300 1980-81 ...... 2739.2 1155.20 269.7 113.76 9.8 2,371,200 1981-82 ...... 3138.7 1314.47 308.0 128.99 9.8 2,387,800 1982-83 ...... 3403.8 1419.97 357.5 149.15 10.5 2,397,100 1983-84 ...... 3960.6 1652.11 386.5 161.22 9.8 2,397,300 1984-85 ...... 5422.7 2259.55 490.6 204.44 9.1 2,399,900

PROVINCIAL CITIES AND TOWNS 1975-76 ...... 156.1 396.34 22.4 61.60 15.5 393,750 1976-77 ...... 235.9 594.68 24.8 67.60 11.4 396,630 1977-78 ...... 272.3 681.16 29.5 73.57 10.8 399,760 1978-79 ...... 269.9 737.00 32.6 81.92 11.1 402,850 1979-80 ...... 336.3 826.96 36.7 90.31 10.9 406,670 1980-81 ...... 383.1 940.03 44.8 109.81 11.7 407,540 1981-82 ...... 413.2 1004.28 49.2 119.58 11.9 411,440 1982-83 ...... 429.4 1032.26 57.5 138.22 13.4 415,980 1983-84 ...... 470.9 1120.28 61.7 146.79 13.1 420,340 1984-85 ...... 555.7 1309.25 69.9 164.75 12.6 424,440

26 APPENDIX IV -continued

Year (I October- Property Rate Income in 30 September) NAV $(cents) $m $per head $m $per head

ALL OTHER MUNICIPALITIES

1975-76...... 698.7 692.23 77.1 79.30 11.5 1,009,400 1976-77 ..... 1011.5 966.86 85.1 84.53 8.7 1,046,200 1977-78 1155.5 1068.47 98.7 94.03 8.8 1,081,410 1978-9 1214.9 1099.05 110.6 102.77 9.4 1,105,410 1979-80 ...... 1333.1 1176.47 125.2 110.49 9.4 1,133,140 1980-81 1505.9 1287.48 146.3 125.12 9.7 1,169,650

1981-82 '""""'""'. 1704.1 1426.30 166.7 139.53 9.8 1,194,770 1982-83 .,,,,,,,,. ..,,,,,,. 1837.3 1504.17 189.8 155.41 10.3 1,221,470 1983-84 ... 2050.0 1630.62 198.4 157.81 9.7 1,257,190 1984-85 ...... 2445.0 1885.09 234.4 180.68 9.6 1,297,020

TOTAL FOR STATE 1975-76 ... 2654.8 709.39 257.0 71.92 10.1 3,742,350 1976-77 ... 3497.5 925.48 284.6 77.75 8.4 3,779,130 1977-78 .. 3761.7 985.86 325.9 86.20 8.7 3,815,670 1978-79 ... 3873.3 1005.78 357.6 93.74 9.3 3,851,060 1979-80 ,.,,,, ...... 4196.5 1080.15 400.5 103.09 9.5 3,885,110 1980-81 4628.2 1172.17 460.8 116.71 10.0 3,948,390 1981-82 ...... 5256.0 1315.97 523.9 131.17 10.0 3,994,010 1982-83 ··················· 5670.5 1405.49 604.8 149.91 10.7 4,034,550 1983-84 ··················· 6481.5 1590.62 646.6 158.68 10.0 4,074,830 1984-85. 8423.4 2043.84 794.9 192.88 9.4 4,121,360 NOTE: Statistics relating to the financial distribution of municipal expenditure will appear in detail in the Australian Bureau of Statistics local government bulletins.

27 APPENDIX V

TAX SHARING FUNDS FOR LOCAL GOVERNMENT AUTHORITIES

1974-75 to 1986-87 ($'000)

Ne\\' South Queens· South Western Terri· Wales Victoria land Australia Australia Tasmania Total 1974-75 (a) 21,359 14,630 8,954 4,774 4,959 1,669 56,345 1975-76 (a) 29,257 20,242 13,808 6,785 7,524 2,292 79,908 1976-77(b) 51,289 35,398 24,222 11,925 13,162 4,004 140,000 1977-78(b) 60,341 42,078 27,875 14,220 15,524 5,290 165,328 1978-79 (b) 65,487 45,666 30,252 15,433 16,848 5,741 179,427 1979-80 (b) (c) 80,930 56,436 37,387 19,072 20,821 7,095 221,739 1980-81 (b)(d) 109,780 76,554 50,714 25,871 28,243 9.624 300.786 1981-82 (b)(d) 128,058 89,300 59,158 30,178 32,945 11,227 350:865 1982-83 (b) (d) 154,928 108,037 71,571 36,510 39,858 13,582 424,486 1983-84 (b) (d) 167,647 116,907 77,447 39,507 43,130 14,697 459,335 1984-85 (b) (d) 177,574 123,829 82,033 41,847 45,684 15,568 486,534 1985-86 (b) (e) 195,615 136,409 90,366 46,098 50,325 17,149 535,962 1986-87 (b) (0 211,753 147,664 97,822 49,901 54,477 18,564 580,181 TOTAL: I ,454,018 1,013,150 671,609 346,697 368,924 (a) Amounts recommended by the Commonwealth Grants Commission. (b) Allocation between States based on a percentage distribution recommended by the Commonwealth Grants Commission. (c) Increase in local government share to 1. 75 per cent of net personal income tax collections. (d) Increase in local government share to 2.00 per cent of net personal income tax collections. (e) Estimated amount available for allocation; equal to amount allocated in 1984-85, adjusted for the estimated increase in the Consumer Price Index for the 12 months ending the March Quarter 1986 and allowing for a 2 per cent betterment factor. The amount is subject to adjustment when the Final Consumer Price Index figure is known. (f) Estimated amount available for allocation; equal to amount allocated in 1985-86, adjusted for the estimated increase in the Consumer Price Index for the 12 months ending the March Quarter 1987 and allowing for a 2 per cent betterment factor. The amount is subject to adjustment when the Final Consumer Price Index figure is known. (g) 1986-87 Commonwealth allocation to the States now includes an allocation for the Northern Territory.

NOTE: Minor discrepancies in the totals may occur in some instances due to rounding. SOURCE: Prior to 1978-79, 'Payments to or for the States, the Northern Territory and Local Government Authorities 1977-78'. 1979-80 to 1982-83, 'Payments to or for the States, the Northern Territory and Local Government Authorities 1982-83'. 1983-84 on, 'Payments to or for the States, the Northern Territory and Local Government Authorities 1986-87'.

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