General News
18 December, 2025
MP slams growing cost shifting to council
MEMBER for Western Victoria Bev McArthur has warned Victorians risk missing out on local services as councils come under growing financial pressure.
Mrs McArthur said a recent report from the Victorian Auditor General’s Office (VAGO) revealed audited councils are currently meeting their immediate obligations and holding relatively low levels of debt, but said the longer-term picture was far more worrying.
She said with key short and medium-term indicators of financial performance and position are heading in the wrong direction.
The report shows net operating cash flows and adjusted underlying results are declining, meaning councils are less able to reinvest in local services and infrastructure.
It also revealed councils as a sector had not delivered their full capital works programs in every year since 2017–18.
Mrs McArthur said findings back in a previous parliamentary inquiry, which warned the State Government’s practice of shifting costs and responsibilities onto local councils was contributing to deteriorating financial sustainability across all council types – a trend expected to continue over the next five to ten years without change.
“I am most concerned for the 19 small shires in this state who have limited revenue bases due to their small populations and limited options to raise revenue outside of unwanted rate rises,” she said.
Mrs McArthur called on the government to follow the lead of New South Wales by properly measuring and publicly reporting the extent of state cost shifting onto local government, and to take immediate action to reduce the unfunded burden being placed on councils and ratepayers.