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Northern Territory Grants Commission Annual Report 2010/2011

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Northern Territory Grants Commission Annual Report 2010/2011 NORTHERN TERRITORY GRANTS COMMISSION Annual Report 2010-11 ISSN 1835-4440 Annual Report 03 NORTHERN TERRITORY GRANTS COMMISSION GRANTS TERRITORY NORTHERN Ms Malarndirri McCarthy MLA Minister for Local Government Parliament House DARWIN NT 0801 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 2010-11. Included in the report are the financial statements for the year ended 30 June 2011. Yours sincerely Bob Beadman Chairman 14 October 2011 Annual Report 04 CONTENTS Foreword 06 The Northern Territory Grants Commission 08 Background 09 Relevant legislation 09 Organisation and People 10 Membership 11 Members’ profiles 12 Administration and staffing 13 Summary of Activities 2010-11 14 Methodology 15 Annual conference 15 Executive Officers’ meeting 16 Visits to local governing bodies 16 Public hearings 16 Financial data 16 Annual financial statements 16 Submissions 16 Payments 2010-11 16 Estimated entitlement 2011-12 17 Entitlement 2010-11 17 Cash entitlement 2011-12 17 Communication with councils 17 Council letters of advice 17 Revenue and expenditure assessments of local governments 17 Recommendations 18 Chairman’s letter 19 Recommendation Schedule 2011-12 21 Schedules 22 Schedule 1 Population 2011-12 23 Schedule 2 Cost adjustors and key drivers 2011-12 23 Schedule 3 Road lengths 2011-12 24 Schedule 4 Reconciliation of local government income and expenditure 25 Schedule 5 Local government income 2009-10 26 Schedule 6 Actual local government expenditure 2009-10 27 Schedule 7 Assessed revenue 2009-10 28 Schedule 8 Summary standardised revenue 29 Annual Report 05 NORTHERN TERRITORY GRANTS COMMISSION GRANTS TERRITORY NORTHERN Schedule 9 Standardised expenditure 30 Schedule 10 National share of financial assistance grants 2011-12 31 Schedule 11 Visits to local governing bodies 32 Schedule 12 Schedule of councils who failed to lodge their 2009-10 annual financial statements by the date specified 35 Appendices 36 Appendix A National principles for the allocation of general purpose and local road grants 37 Appendix B Methodology and formula factors 38 Appendix C The Australian Classification of Local Government (ACLG) 41 Appendix D Northern Territory local governments by classification 42 Appendix E Northern Territory map of shire areas 43 Appendix F Independent Auditor’s Report to the Minister for Local Government 44 Northern Territory Grants Commission balance sheet and income statement for the year ended 30 June 2011 45 Foreword Annual Report 07 NORTHERN TERRITORY GRANTS COMMISSION GRANTS TERRITORY NORTHERN On behalf of my fellow Commissioners I am pleased to The Commission conducted a series of well attended visits present the 25th annual report of the Northern Territory to shires and their service delivery centres throughout the Grants Commission. The report contains information on the 2010-11 year. Five shire councils and their respective service distribution of funding, as well as detailing the objectives, delivery centres were visited, with a public hearing being performance and future directions of the Commission. My held in Litchfield. belief is that the report conveys sufficient relevant information On behalf of the Commission members I wish to record our on the Commission’s programs and performance during appreciation for the valuable cooperation and assistance that the year to enable any interested agency, organisation we have received during our work throughout the year from or individual to assess its operations and functioning. local governing bodies, and in particular, those visited during The coincidence of the introduction of New Local Government the course of the year. in 2008-09 and the completion of the phased-in The Commission is grateful for the executive support and methodology has allowed the Commission to take breath assistance provided by Mr Peter Thornton and Mrs Donna and determine its priorities into the future. Hadfield of the Local Government Grants Program of the During 2010-11 the primary focus of the Commission was Department of Housing, Local Government and Regional the further refinement of our methodology in the following Services, combined with assistance and services provided two areas: by regional offices of the Department. • Review of the Location Factor; and I would also like to acknowledge the efforts of my colleagues: • Re-examine the regional centre recognition issue Ms Trish Angus, Mr Damien Ryan, Mr Steven Hennessy and deputies Mrs Lissa Herrmann and Mrs Margaret Vigants. During the course of the 2011-12, the Commission will also Their assistance has been very much appreciated. be examining it road funding methodology in light of the proposed local road transfers form the Northern Territory There is no doubt that 2011-12 will be equally as challenging Government to the recently created shires now that almost as the previous year. On behalf of all Commissioners, I look full incorporation of the Northern Territory has been achieved forward to working with the Minister for Local Government, (as opposed to the previous five per cent of the land mass). all councils, councillors and staff and the Commonwealth Department of Regional Australia, Regional development Further information on the status of these activities is and Local Government in the allocation of the funding, and contained within the body of the report. in particular on any further refinement of the methodology. Whilst the early information technology problems experienced by shires have been largely resolved, it is disappointing that a large number of the shire councils are still not meeting the statutory deadlines for submitting their audited financial statement and annual data returns to the Commission. However, I am pleased to advise that all councils eventually Bob Beadman produced a full set of 2009-10 audited financial statements, Chairman along with completion of annual returns to the Commission. It is hoped that the continued delays experienced by the eight new local government shires in the presentation of this data will not be repeated in future years. The data collected is forwarded to the Australian Bureau of Statistics (ABS) for use in government finance statistics and national accounts. Through this process, a very good working relationship has been established between the relevant staff of ABS and the Commission. The Commission Annual Report 09 NORTHERN TERRITORY GRANTS COMMISSION GRANTS TERRITORY NORTHERN BCA KGROUND Relevant Legislation On 1 July 1986, the Commonwealth Government began The Northern Territory’s Local Government Grants a process of yearly appropriations to the state/territory Commission Act also repeated a requirement of an earlier Act governments for distribution as financial assistance grants that provides for the appointment of Commission members, to local governing bodies within the respective jurisdictions. and specifies the general operations of the Commission, A subsequent review of the enabling legislation led to the including the annual reporting requirements. current Act, the Local Government (Financial Assistance) The Commonwealth’s Local Government (Financial Act 1995. Assistance) Act 1995 provides for the basis of the allocation Under section 6(1) of the Act, the Commonwealth Minister, of financial assistance by each Local Government Grants after consulting with the relevant state Ministers and with Commission to its respective local governing bodies in its bodies representative of local government, must formulate state and/or the Northern Territory. national principles. The national principles formulated by the Commonwealth In formulating the national principles, the Minister: Minister are to guide the respective Local Government (a) is to have regard to the need to ensure that the allocation Grants Commissions in the allocation of funds to local of funds for local government purposes is made, as far as governing bodies within their own jurisdictions. practicable, on a full horizontal equalisation basis; but The number of national principles currently stands at (b) must ensure that no local governing body will be seven – six applying to the allocation of general purpose allocated an amount in a year that is less than the amount grants and one applying to the allocation of local road that would be allocated to the body if 30 per cent of the grants. The national principles are detailed at Appendix A. amount to which the state/territory is entitled, in respect of the year, was allocated among local governing bodies on a per capita basis. The Local Government (Financial Assistance) Act 1995 also requires each state and the Northern Territory to have a Local Government Grants Commission. In accordance with that requirement, the Northern Territory legislated for a statutory, independent commission, the Northern Territory Grants Commission (the Commission), in June 1986. Role of the Northern Territory Grants Commission The Commission is established as an independent statutory authority under the Local Government Grants Commission Act. Its primary role is to recommend the allocation of the financial assistance grants provided by the Commonwealth Government for Northern Territory local governing bodies in the form of general purpose grants and local roads grants. Organisation and people Annual Report 11 NORTHERN TERRITORY GRANTS COMMISSION GRANTS TERRITORY NORTHERN Membership The Local Government Grants Commission Act 1986 provides for a Commission of four
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