Chapter 5: Regional Development and Local Government

The Public Governance, Performance and Accountability Rule 2014 requires this annual report to include a report on the Department's performance during 2015–16. A core element of this is the inclusion of an annual performance statement which demonstrates performance in relation to our purpose and programs.

Annual Performance Statements

Purpose Two programs contribute to the Regional Development and Local Government outcome (Outcome 3) set out in the Portfolio Budget Statements: Program 3.1 Regional Development; and Program 3.2 Local Government.

The purpose of these programs together is to strengthen the sustainability, capacity and diversity of regional economies including through facilitating local partnerships between all levels of government and local communities*

* The purpose was changed from that in the 2015–16 Corporate Plan for relevancy.
Result Table 5.1 and 5.3 detail the performance criteria which relate to this purpose, and the result against each. Each criterion is published in both the 2015–16 Corporate Plan and the 2015–16 Portfolio Budget Statements against Programs 3.1 and 3.2.

Table 5.1 Results Against Performance Criteria—Program 3.1 Regional Development

Performance CriterionRegional Ministerial Budget Statement is delivered following the 2015–16 Budget
Result Achieved (new criterion 2015–16)

The 2016–17 Regional Ministerial Statement: Investing in Regional Growth was released on Budget night (May 2016). The statement outlines all measures which impact on regional Australia.
Performance CriterionProgress in Australian Regions series is published and accessed by the community
Result Achieved (new criterion 2015–16)

The Progress in Australian Regions series was updated in 2015. Findings from the publications received national media attention and positive feedback has been received from a range of regional stakeholders as part of a comprehensive review of the progress indicators. Several Australian Government agencies have used the publications to inform their understanding of regional variation and local governments have used it to understand how their individual region is progressing.
Performance CriterionCollaboration on regional policies in areas such as health, education, skills, infrastructure, environment and industry delivers benefits to regional communities
Result Achieved (new criterion 2015–16)

Throughout the year the Department collaborated with a range of other departments to shape their policies to consider the benefits and implications in regional areas.
Performance CriterionProjects that receive funding through Community Development Grants are delivered on time and on budget
Result Achieved (new criterion 2015–16)

Announced in October 2013, the Department is administering 300 projects under this program. Of these, 184 projects are completed with $176.2 million in payments made to 30 June 2016.

Payment of $111.2 million was made in 2015–16 achieving a variation of less than 1 per cent under the expected target for the year.

This program is on track to conclude by 30 June 2018 on time and within the current appropriation of $348.6 million.
Performance CriterionProjects that receive funding through the Tasmanian Jobs and Growth Package are delivered on time and on budget
Result Substantially achieved (new criterion 2015–16)

Announced in October 2013, the Department is currently administering 30 projects under this program. Of these, 19 projects are completed and 10 projects are contracted and underway with $57.2 million in payments made to 30 June 2016.

Delays to contract negotiations and the delivery of milestones resulted in payments of $19.4 million made in 2015–16 achieving a variation of a little more than 20 per cent under the expected target for the year. One contract remains under negotiation, the mutual termination of another project and the significant reduction in scope to a third project have contributed to the under spend. This program is on track to conclude by June 2017 within the current budget of $88.9 million.
Performance CriterionProjects that receive funding through the Latrobe Valley Economic Diversification program are delivered on time and on budget
Result Achieved (new criterion 2015–16)

The appropriation period for this program finished on 30 June 2016. The Australian Government funded activity was completed by June 2016 and the full budget allocation of $10.9 million made. Warragul Station Precinct and Moe Station Precinct projects were completed.
Performance CriterionProjects that receive funding through the Murray-Darling Basin Regional Economic Diversification Program are delivered on time and on budget
Result Achieved (new criterion 2015–16)

The NSW, Queensland and Victorian governments received payment of $27.5 million in 2015–16. Since the commencement of the program in 2013–14 the three states have received $49.5 million in payments to 30 June 2016. This program is on track to be completed by June 2017, within the budget allocation of $72.7 million.
Performance CriterionProjects that receive funding through the Regional Development Australia Fund are delivered on time and on budget
Result Achieved (new criterion 2015–16)

The 2015–16 Budget for the program was $40.9 million, with payments of $40.5 million being made.

A total of 103 projects have been completed and payments of $243.9 million were made between September 2013 and June 2016. The program is planned to be completed by 30 June 2017.
Performance CriterionProjects that receive funding through the National Stronger Regions Fund are delivered on time and on budget
Result Substantially achieved (new criterion 2015–16)

The Department successfully assessed 1,398 applications for funding under the first three rounds of the NSRF program. Under rounds one and two, 162 projects were selected to receive $505.6 million in funding. Of these, 144 were contracted with five projects completed and one not proceeding. The 2015–16 Budget appropriation was $35.0 million.

Delays to contract negotiations and the delivery of milestones resulted in payments of $20.3 million in 2015–16, with remaining funds moved into the forward years to reflect expected milestone delivery. Where appropriate, variations to existing contractual arrangements with proponents will ensure this program remains on track to conclude by 30 June 2020 and within the allocated Budget.
Performance CriterionRegional Development Australia committees work with key regional stakeholders and local governments to develop a regionally supported plan and quality priority economic development project proposals, and promote Australian Government programs
Result Achieved (new criterion 2015–16)

Regional Development Australia committees continue to build partnerships across all levels of government to enhance the economic development of their regions. They worked with proponents to develop project proposals and promoted Australian Government programs.

Each committee developed a regional plan, which outlines priorities for the region and local communities. The Department reviewed the committee plans and provided guidance on regional and local priorities.
Performance CriterionProvide timely advice to the Minister for the delivery of regional infrastructure funds including the Community Development Grants, Tasmanian Jobs and Growth Package, Regional Development Australia Fund and the National Stronger Regions Fund
Result Achieved (new criterion 2015–16)

Ministers were provided with reliable, appropriate and timely advice on the performance of the regional grant programs. This included due diligence and value for money assessments on proposals for the National Stronger Regions Fund and Community Development Grants.

No complaints were received on the timelines of advice provided and requests for action were met or signed. The Community Development Grants, Tasmanian Jobs and Growth Package, Regional Development Australia Fund and the National Stronger Regions Fund are all currently underway.
Performance CriterionRegional Development Australia committees receive operational funding through the Regional Development Australia Program

Target: 100 per cent of forecast
Result Achieved (new criterion 2015–16)

All 55 Regional Development Australia committees received 100 per cent of their Australian Government funding allocation.
Results Key  
Achieved All milestones for 2015–16 were met or exceeded
Substantially achieved Milestones were mostly met, and any issues are being managed

Analysis against the Purpose:

Strengthen the sustainability, capacity and diversity of regional economies including through facilitating local partnerships between all levels of government and local communities (Program 3.1)

The Department works to strengthen the sustainability, capacity and diversity of regional economies through facilitating local partnerships between all levels of government and local communities, and providing grants and financial assistance.

The development of the 2016–17 Regional Ministerial Statement: Investing in Regional Growth during 2015–16 provided a comprehensive overview of Australian Government policies and programs that impact regional Australia (available at www.infrastructure.gov.au/department/statements/2016_2017/ministerial-statement). The focus is on infrastructure and innovation as key drivers of regional development.

The Progress in Australian Regions series of publications track how Australia's regions are progressing over time against key social, economic, environmental and governance measures of societal progress. The data in the 2015 Yearbook publication provides a solid evidence base for policy design within the Department as well as other areas of the Australian and state governments (available at www.regional.gov.au/regional/publications/yearbook).

The Department's regional development programs deliver a range of regionally-focused stakeholder consultation and engagement, research, policy development and program delivery activities. A total of 162 approved projects were provided with more than $505 million of funding under the National Stronger Regions Fund. There were also $350 million approved for 300 Community Development Grants projects which will support local communities by investing in capital infrastructure. Ongoing engagement with state and territory counterparts throughout 2015–16 has deepened the Department's understanding of the priorities and challenges in regional development policy formulation and implementation.

The Department administers $18.3 million in funding from the Australian Government to support the operation of Regional Development Australia (RDA) committees. RDA committees are made up of over 500 local leaders across 55 committees across Australia, who work with all levels of government, business and community groups to support the economic development of their regions. RDA committees have continued to build partnerships, develop strategies and deliver sustainable infrastructure and services to their regions.

Administered Items

Table 5.2 provides a summary of the results achieved by each of the administered items under Program 3.1. Administered items are administered in accordance with relevant legislation, approved guidelines, and guidance by the Australian National Audit Office.

Table 5.2 Administered Items—Program 3.1 Regional Development

Administered ItemCommunity Development Grants Fund
Result The Department administers a total of $348.6 million to fund 300 projects under the Community Development Grants Program from 2013–14 to 2017–18. At 30 June, there were 184 projects completed with $176.4 million in payments made.
Administered ItemDrought Communities Program
Result A total of $3.7 million of priority funding was provided to local government associations experiencing severe drought conditions in Queensland, NSW and Victoria.
Administered ItemLatrobe Valley economic diversification
Result The Department administered $10.8 million for two projects under the Latrobe Valley Economic Diversification Program. The Australian Government funded activity in the Warragul Station Precinct and the Moe Station Precinct projects in the Latrobe Valley, Victoria is now completed and the program is closed.
Administered ItemMurray-Darling Basin Regional Economic Diversification Program
Result The Department is administering $72.7 million under the Murray-Darling Basin Regional Economic Diversification Program from 2013–14 to 2016–17. This will help local communities increase economic diversification and adjust to a water-constrained environment.

A total of $49.5 million in payments were made to the NSW, Queensland and Victorian governments to 30 June 2016.
Administered ItemNational Stronger Regions Fund
Result The Australian Government announced the $1 billion National Stronger Regions Fund on 1 July 2015 to fund priority infrastructure projects in regional and disadvantaged communities.

The Department administers $505.7 million for 162 projects. Five are complete with $20.3 million in payments made to 30 June 2016.

$1.0 billion was available under the program from 2015–16 to 2019–20.
Administered ItemRegional Development Australia Committees
Result $18.2 million in funding was provided to support the operation of 55 Regional Development Australia Committees.
Administered ItemRegional Development Australia Fund
Result The Department administers more than $365 million under the Regional Development Australia Fund to support the infrastructure needs and economic growth of Australia's regions. A total of 123 projects were funded between September 2013 and 30 June 2017.

There are 103 completed projects and payments of $243.9 million were made between September 2013 and 30 June 2016.
Administered ItemSouth Australia Economic Development Program
Result The Department administers $25.0 million of the SA Regional Economic Development Program. Elements managed by the Department include three initiatives:
  • $7.5 million to redevelop the Loxton Research Centre
  • $5.0 million for an industry-led research sub-program, and
  • $12.5 million for a regional development and innovation sub-program.
Payments of $22.5 million have been made under the program to 30 June 2016.
Administered ItemStronger Communities Program
Result Funding of up to $45.0 million over two years was announced as part of the 2015–16 Budget. Funding of $17.4 million for 1,743 projects was approved to 30 June 2016.
Administered ItemTasmanian Jobs and Growth Package
Result The Tasmanian Jobs and Growth Package is aimed at stimulating Tasmania's economy by supporting growth and employment. The Department administers $88.9 million for 30 projects from 2013–14 to 2016–17.

Total payments of $57.2 million have been made to date and 19 projects have been completed. Other Australian Government departments are also delivering projects.

Note: The budget and actual expenditure for each administered item is listed in Appendix A

Table 5.3 Results against Performance Criteria—Program 3.2 Local Government

Performance CriterionThe annual National Awards for Local Government is a key tool for promoting innovation and leading practice service delivery by local government and sponsoring departments
Result Achieved (new criterion 2015–16)

The Department administers the National Awards for Local Government. In 2015–16, 10 category awards were presented, with the winner of the National Award for Excellence in Local Government, Mackay Regional Council in Queensland, selected from the 10 category winners, for their Transforming a Water Business project. Awards were presented at Parliament House on 21 June 2016.

The category winning projects exemplify innovation and leading practice in service delivery. Mackay Regional Council has been able to defer $100 million in capital expenditure and reduce the forward price path of water to $500 per year per customer through its Transforming a Water Business project. The technology has strong potential to be used by other councils and throughout the utility industry.
Performance CriterionFunding provided through the Financial Assistance Grant program

Target: 100 per cent of forecast
Result Achieved (new criterion 2015–16)

100 per cent of forecast funding was provided through the Financial Assistance Grant program to eligible local governing bodies.
Results Key  
Achieved All milestones for 2015–16 were met or exceeded

Analysis against the Purpose:

Strengthen the sustainability, capacity and diversity of regional economies including through facilitating local partnerships between all levels of government and local communities (Program 3.2)

Australian Government funding through the Financial Assistance Grants program strengthens the sustainability, capacity and diversity of regional economies and helps local government to deliver local priorities. The untied funding supports local councils to deliver the services, facilities and infrastructure needed to support their community. The Department delivered the funding for 2015–16 with all payments made on time and in accordance with regulatory requirements.

The National Awards for Local Government celebrate and raise awareness of successful local government initiatives and promote networks and collaboration across the sector. They strengthen the sustainability, capacity and diversity of regional economies and support local communities. The Department effectively supported the 2016 Awards, culminating in the Awards presentation at Parliament House on 21 June 2016.

Administered Items

Table 5.4 provides a summary of the results achieved by each of the administered items under Program 3.2. Administered items are administered in accordance with relevant legislation, approved guidelines, and guidance by the Australian National Audit Office.

Table 5.4 Administered Items—Program 3.2 Local Government

Administered ItemLocal Government Financial Assistance Grants
Result $1.14 billion was provided through the Financial Assistance Grant program to eligible local governing bodies. This figure was adjusted to reflect a forward payment of $1.14 billion made in late 2014–15.

Note: The budget and actual expenditure for each administered item is listed in Appendix A.

Case Studies

Progress in Australia's Regions—Yearbook 2015

The Department has developed the Progress in Australian Regions—Yearbook series to explore the question: “Is life in your region getting better?” The 2015 edition of the Yearbook builds on the success of the inaugural publication, tracking how Australia's regions are progressing over time against key social, economic, environmental and governance measures of societal progress.

In response to stakeholder feedback, the 2015 Yearbook also includes an expanded set of regions, which allows for the measurement of progress at a more detailed level in outback Australia. This provides an even more comprehensive overview of regional progress.

The Yearbook's information is valuable when it comes to the Department and its stakeholders determining what regional areas need in terms of infrastructure and government services. For example, the Yearbook measures health indicators including life expectancy at birth, smoking rates and obesity rates. This information can be used by agencies to measure the health outcomes of regions and highlight health risk factors. Other indicators, including household income and the proportion of young people engaged in work or study, can be used to understand the capacity of people within a particular region to maintain a high standard of living and contribute to the economy.

Indicators from the Yearbook can also be used to prompt consideration of the effects proposed policies and programs may have on regional development. For example, the information from the 2015 Yearbook has been used by the Department and other agencies to complete Regional Australia Impact Statements. These statements assess the effects, positive and negative, which a new policy proposal may have on regional Australia.

In 2016, the Yearbook's current suite of indicators is being reviewed across the Australian Government. Feedback received will be incorporated to ensure the Yearbook continues to provide the best available information on regional progress.

Dubbo regional livestock market upgrade

Operating for over 65 years the Dubbo Regional Livestock Market is one of the largest of its kind in NSW, contributing approximately $75.6 million into the Dubbo Regional economy annually. As part of the National Stronger Regions Fund (NSRF), the Dubbo Regional Livestock Market will receive a $3.3 million grant to improve its long-term sustainability and growth of the market.

The Australian Government has committed $1.0 billion to the NSRF over five years. The purpose of the NSRF is to fund priority infrastructure in regional and disadvantaged communities, while allowing communities to identify their own infrastructure projects. It particularly encourages partnerships between not-for-profit organisations, local, state and territory governments as well as the private sector. The Department assesses funding applications under the NSRF and administers funds to successful applicants as they progress towards pre-agreed milestones. This approach is helping Australia's regions invest in their own future and promotes sustainable and contextual infrastructure investment.

The NSRF grant to the Dubbo Regional Livestock Markets will be matched by Dubbo City Council from the market's business, with the total project valued at $6.58 million. The upgrade will enable the market to expand and further contribute towards the region's sustainable economic growth. This includes the creation of additional ongoing jobs as a result of the upgrade.

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Last Updated: 12 December, 2016