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Victoria Grants Commission Annual Report 1986 Victoria

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Victoria Grants Commission Annual Report 1986 Victoria VICTORIA GRANTS COMMISSION ANNUAL REPORT 1986 VICTORIA 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, MELBOURNE, 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
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