VICTORIA GRANTS COMMISSION ANNUAL REPORT 1983 VICTORIA Annual Report of the VICTORIA GRANTS COMMISSION for the Year ended 31 August 1983 Ordered by the Legislative Assembly to be printed MELBOURNE F D ATKINSON GOVERNMENT PRINTER 1983 No.ll9 VICTORIA GRANTS COMMISSION ANNUAL REPORT 1983 The Hon. F N Wilkes. MP. Minister for Local Government, 480 Col/ins Street, MELBOURNE. VIC 3000. As Members appointed under section 3 of the Victoria Grants Commission Act 1976, we have the honour to present the seventh Annual Report of the Victoria Grants Commission, in accordance with section 17 of that Act. D. V. MOYE, Chairman L. F. CHEFFERS, Member J. M. WALTON. Member F.M. THOMAS Secretary November, 1983 68707/83 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.A, M.B.S. The Hon. J. M. Walton SECRETARY F. M. Thomas, B.Ec. (Hons). TABLE OF CONTENTS Page No. INTRODUCTION . vii CHAPTER I. THE YEAR'S ACTIVITIES . I Inspections . I Annual Return oflnformation . 2 Submissions . 3 Comparisons between Years . 3 Conference of State Grants Commissions . 5 Federal Government Policies . 5 Visit of Commonwealth Grants Commission . 5 2. THE BASES OF THE DETERMINATIONS . 7 As-of-Right Entitlement . 8 Equalistion . 8 Revenue Raising Needs . 9 Expenditure Needs and Disabilities . 11 Determining the Individual Allocations . 15 Natural Disasters . 15 Acknowledgements . 16 APPENDICES I Transmittal Memorandum and Determinations . 17 II Municipalities Insl?ected . 24 Ill Categories of Mumcipalities . 25 IV Formulae . 27 V Distribution of Rateable Property, Rate Income, Rating and Population 1975-76 to 1981-82 . 32 VI Tax Sharing Funds for Local Government Authorities 1974-75 to 1983-84 . 33 V INTRODUCTION The primary role of the Commission is to determine the allocation to munici­ palities in Victoria of grants from the Commonwealth to the State for local govern­ ment authorities under the provisions of the Commonwealth's Local Government (Personal Income Tax Sharing) Act 1976. The Victoria Grants Commission Act 1976 was proclaimed on 9 February 1977 and the Commission, consisting of a full-time Chairman and two part-time Members, was formally constituted on 24 May 1977. By notification in the Commonwealth Gazette of 30 June 1978, the Victoria Grants Commission was formally declared the body to be the Local Government Grants Commission of the State of Victoria, in accordance with section 4 of the Local Government (Personal Income Tax Sharing) Act 1976. Mr. S. L. Cooper retired from the O~mmission on 31 October 1982, after serving as a member since its inception in May 1977. His service with the Commission followed lenghty service as a Councillor with the Shire of Upper Yarra, including three terms as Shire President Mr. Cooper's wide knowledge of local government and extensive experience in local and community affairs was of very great benefit to the Commission. The Hon. J. M. Walton was appointed to succeed Mr. Cooper, for a three year term commencing 1 November 1982. The Hon. J. M. Walton was member of Parlia­ ment for Melbourne North Province in the Victorian Legislative Council for twenty­ four years and spokesman for the then Opposition on Local Government, Planning, Water Supply. Forests and State Development and Decentralisation. He was also a Councillor with the City of Brunswick for six years and served a further six years as Councillor with the City of Coburg. Section 12 of the Victoria Grants Commission Act 1976 requires the Commission. on or before 31 August each year, to determine the amount of~eneral revenue grants to be allocated to each municipality in that year. The Commission's determination for the 1983-84 financial year was transmitted to the Minister for Local Government on 19 August 1983. A copy of the transmittal memorandum and of the Determina­ tion are included in Appendix I to this Report. 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 31 August This Report is in compliance with that requirement vii Chapter I THE YEAR'S ACTIVITIES 1.1 The primary role of the Victoria Grants 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 (Personal Income Tax Sharing) Act 1976 and under the Victoria Grants Commission Act 1976 which complements it To assist the Commission in this role, the Victoria Grants Commission Act provides that: "10. (1) 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 of a 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 Commission 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 tion, 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 Commission by Councillors or the municipal clerk or the municipal engineer or full-time officers of the municipality and not otherwise." 1.2 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 Commission as to any factors which appear to the Minister to be of special signficance 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. 1.3 In addition, pursuant to section 16 of the Victoria Grants Commission Act 1976, the Commission is required to "enquire into and report upon any other matter relating to local government finances which is referred to it by the Minister". No such matter was referred to the Commission during the year ended 31 August 1983, nor in any previous year. 1.4 The Commission was convened on one hundred and one days during the year ended 31 August 1983 in order to undertake inspections and confer with Council representatives and to consider written submissions and other evidence relevant to the determination of allocations for the 1983-84 financial year. INSPECTIONS 1.5 Inspections were undertaken of forty-four municipalities throughout the State during 1982-83; this corn pleted the second round of a five-year programme of inspecting each municipality. In addition the Commission visited the Bright and Mansfield Shires early in July in order to evaluate the impact of visitors to the major ski resorts on the operations of the two municipalities. 1.6 The aim of the inspections is to covert he range of services being provided by the respective Councils, in order that the Commission might better appreciate the conditions which each Council faces in serving it') community. A period is set aside at the end of each inspection for discussion with Councillors and their officers about the role of the Commission and about aspects of municipal functions which are relevant to that role. 1.7 These inspections and discussions have been invaluable to the Commis­ sion because of the benefit of a more comprehensive knowledge of the physical characteristics of each 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 Councils' policy decisions. 1.8 The flexibility available in inspection pro~ramming as a result of the shift to a five-year framework has enabled the Commiss10n to devote more time to areas where special circumstances prevail. Examples of this are the visit to the Portland area in 1981-82 to assess the impact of the Alcoa project on the Portland Town and Portland Shire Councils and the visit to the Bright and Mansfield Shires in 1983 to assess the impact of the major snow resort areas on the activities of the two Councils. ANNUAL RETURN OF INFORMATION 1.9 As indicated in paragraph 1.1, section I 0 of the Victoria Grants Commission Act 1976 authorises the Commission to require each municipality to provide pres­ cribed information on or before a date fixed by the Commission. In conformity with that section, 6 December 1982 was the date fixed by notice in the Victoria Government Gazette No. 102 of 13 October 1982, as the date by which the prescribed information for the financial year ended 30 September 1982 should be returned to the Commission. 1.10 The Commission has worked closely with the Victorian office of the Australian Bureau of Statistics on the continuing development of the joint Return of statistical and other information which serves the needs ofthe Commission and the Bureau. The Return has been devised to conform with the standardised form of recording local government financial statistics and the introduction of the new regulations for local government accounting, which is also aligned to that format, is expected to increase the accuracy oflocal government statistics and to substantially simplify the task of completing the Returns.