Council
15 September, 2026
Council facing a massive decrease in funding
Proposed changes to the way Commonwealth Financial Assistance Grants are distributed to NSW councils could cost Wingecarribee Shire Council approximately $2.7 million a year.
Proposed changes to the way Commonwealth Financial Assistance Grants are distributed to NSW councils could cost Wingecarribee Shire Council approximately $2.7 million a year.
Mayor Jesse Fitzpatrick has spoken out against the proposed changes, describing an approximate 41 per cent reduction as “difficult to justify”.
Shoalhaven City Council – facing a $2.2 million reduction in its allocation – has also raised alarm over the proposed changes, describing them as a “slap in the face” for the Shoalhaven community.
The changes being proposed by the NSW Local Government Grants Commission are designed to help small rural and regional councils facing massive infrastructure gaps.
The Local Roads Component of the grants is also being revised to favour those councils with vast road lengths but low population densities.
It means mid-sized and fringe metropolitan councils face massive decreases in funding.
The news comes at a time when Wingecarribee Shire Council is set to consider a Special Rate Variation (SRV) and will possibly place even greater pressure on councillors to give the green light to a massive rates hike.
Cr Fitzpatrick said a decrease in the Commonwealth Financial Assistance Grant would impact on council’s long-term financial sustainability at a time it was trying to get things back on track.
“For the past year, this council has done the hard work on financial sustainability.
“We have opened our books, independently tested our financial position, looked hard at our costs and services, developed a draft Containment and Productivity Plan and had an honest conversation with our community about what it will take to properly fund our infrastructure into the future.
“We have not hidden from the problem and we have not pretended there is an easy answer,” Cr Fitzpatrick said.
“To now have a proposed funding methodology potentially remove another $2.7 million a year from Wingecarribee is extraordinarily difficult to justify.
“Our community should not be asked to carry the consequences of a funding redistribution that fails to properly recognise what it costs to run a regional council like ours.”
Cr Fitzpatrick said Wingecarribee Shire Council maintained a “massive” road network and billions of dollars worth of community infrastructure.
“Those costs and that responsibility do not disappear because a funding formula changes.
“And this comes at a time when councils across NSW are already being asked to do more with less.
“Governments cannot continue talking about the financial sustainability of local government on one hand while making decisions that make councils less sustainable on the other.”
Cr Fitpatrick said council had spent “considerable time” working out what is required to put Wingecarribee on a stronger financial footing.
“A loss of this magnitude changes that equation.
“Ultimately, there are only so many places the money can come from.
“It means greater pressure on rates, less money for infrastructure and maintenance, or some combination of both.
“None of those outcomes is acceptable without first challenging the basis on which this money is proposed to be taken away from our community.”
Cr Fitzpatrick said Financial Assistance Grants existed because local councils provide essential infrastructure and services that communities and other levels of government depend upon.
“Redistributing an already inadequate funding pool between councils does not solve the broader problem facing local government,” Cr Fitzpatrick said.
“It simply moves the financial pressure from one community to another.”
Cr Fitzpatrick said the Federal Government should be increasing its investment in Financial Assistance Grants and not leaving councils to fight over an insufficient pool.
Acting Shoalhaven Mayor Peter Wilkins said the proposed decrease in funding was the “exact opposite of what’s needed”.
“Local government is at the frontline of service delivery and if governments are serious about looking after regional communities they should be increasing funding to councils, not decreasing it.”
Wingecarribee Shire Council will consider making a formal submission opposing the proposed methodology and setting out the significant consequences for Wingecarribee and its community at its September 16 meeting.
Shoalhaven City Council has said it will provide “detailed written feedback” to the NSW Local Government Grants Commission before submissions close on October 9.
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