Glen Innes Severn Council Mayor, Cr Margot Davis says the Federal Government’s 2026–27 Budget response continues to fall short of delivering genuine equity for regional, rural and remote communities, despite announcing $2 billion for roads, water and sewerage infrastructure to support housing, including $500 million for regional Australia.
Cr Davis said the enabling infrastructure investment aligns strongly with advocacy she has undertaken alongside the Australian Local Government Association, Country Mayors Association and regional councils across Australia, which have consistently argued that housing targets cannot be achieved without addressing the infrastructure gap facing regional communities.
“Local governments are ready to support housing growth, but regional communities continue to operate within funding systems that fundamentally favour metropolitan scale and existing population concentration,” Cr Davis said.
“Roads, water and sewerage are the foundations of growth, and it is positive to see infrastructure recognised in the Budget. However, the broader funding settings still do not reflect the realities facing regional, rural and remote councils.”
The Mayor said infrastructure constraints — not land availability or willingness — remain one of the biggest barriers to unlocking housing and economic growth in regional Australia.
“For councils like Glen Innes Severn, upfront, place-based investment is essential to making subdivisions and infill development financially viable,” she said.
“One-size-fits-all funding models designed around metropolitan growth patterns simply do not work in regional Australia.”
Cr Davis said that while the $500 million regional allocation may initially sound significant, the funding would ultimately be spread across a vast number of communities and risks being disproportionately directed toward larger regional centres already perceived to be growth areas.
“If governments are serious about additional housing supply, recognise the continued migration of people from metropolitan areas into regional communities, and are genuinely committed to regional development, funding models cannot simply reward places that are already growing,” she said.
“The purpose of regional investment should be to create growth opportunities, unlock capacity and support communities with long-term potential — not reinforce existing inequity.”
“Smaller regional councils face higher per-lot infrastructure costs, ageing assets, declining economies of scale and much smaller rate bases, yet we are often expected to compete under frameworks that inherently favour larger population centres.”
Cr Davis said the Budget was particularly disappointing in its continued reduction of untied Commonwealth funding delivered through Financial Assistance Grants.
“Financial Assistance Grants are the backbone of council funding, particularly for rural, regional and remote communities,” she said.
“The national FAGs allocation has now fallen from 0.51 per cent to 0.49 per cent of Commonwealth taxation revenue. That may sound marginal in percentage terms, but for regional councils it represents another erosion of long-term funding sustainability.”
“Councils are being asked to maintain ageing infrastructure, deliver more services, absorb rising costs and respond to increasing compliance obligations, while the flexible funding base that allows councils to respond to local priorities continues to shrink.”
“For many regional, rural and remote councils, this is exactly why Special Rate Variations are becoming unavoidable. Communities are increasingly being forced to fund essential infrastructure and services locally because the funding burden is progressively shifting away from the Commonwealth.”
“You cannot continue expecting rural councils to do more with less and somehow maintain the same level of infrastructure, liveability and service delivery indefinitely.”
Cr Davis also raised concerns regarding the broader transport implications flowing from the Budget, particularly the removal of funding associated with completing Inland Rail.
She said the decision significantly undermines assumptions embedded within the draft New England North West Strategic Regional Integrated Transport Plan.
“You cannot build long-term regional transport planning around freight, logistics and population assumptions linked to major national infrastructure projects, and then remove the infrastructure without completely revising the strategy,” Cr Davis said.
“The draft Strategic Regional Integrated Transport Plan will now require extensive review between the draft and final version because the strategic context has materially changed.”
“Major infrastructure assumptions, freight movements, growth projections and regional transport priorities cannot remain static when significant national funding decisions alter the landscape the plan was built around.”
The Mayor also questioned whether some of the population and growth assumptions underpinning the draft transport plan accurately reflect current regional realities.
“There appears to be a disconnect between some of the projections being used in strategic planning documents and the demographic trends reflected in ABS data,” she said.
“With another Census approaching, there is a strong case for these assumptions to be reassessed to ensure future infrastructure planning is grounded in accurate and contemporary regional data.”
Cr Davis said regional communities deserve infrastructure and funding frameworks that are evidence-based, equitable and genuinely designed to support long-term regional sustainability and growth.
“Council will continue advocating to ensure regional, rural and remote councils are not left carrying disproportionate financial pressure while continuing to deliver essential infrastructure and services to their communities,” Cr Davis said.
Media Release: Glen Innes Severn Council
