About the Australian Rural Roads Crisis
Nationally-significant infrastructure for Australia
Australia’s local road network is the first and last mile of most Australian road journeys. Local roads represent almost 80% of all roads in Australia, when measured in kilometres.
In rural, regional and remote Australia, these roads are often the biggest single factor for business efficiency, domestic and export market success, social connectedness and community safety. Yet only 41% of Australia’s local roads are even sealed in bitumen!
By any measure, these roads are a nationally-significant infrastructure asset. But they are ageing fast and falling into increasingly poor condition. These roads are failing to support efficient agricultural business. They are not ready to support the huge development of mining activity occurring in many of Australia’s rural areas.
Nationally significant, but nationally ignored!
Together Australia’s local roads are valued at around $75 billion dollars, but Australia does not manage this asset centrally or strategically. Local roads are underfunded by around 3 billion dollars each year. Current bureaucratic structures don’t allow for current funds to be spent efficiently on road upkeep and expansion.
Canberra is in the dark about local roads. It can tell you almost nothing about them: local roads are a $75 billion dollar asset of national significance that have been mismanaged by successive governments for decades. Local roads are the lifeblood of much of the Australian economy. Their management and funding structures must change.
The Australian Rural Roads Group is a non-political organisation of over 100 rural local governments and affected rural businesses and local communities that want this problem fixed. It is dedicated to developing innovative and excellent policy research and structural reform proposals that will see Australia’s local road networks in better condition for future generations to support prosperous rural communities.
Of all the road investment levels in Australia (local state and federal), local road funding is the most complex and least transparent. Local road funding is a vast undertaking, considering the volume of road stock – but the funding attached to that road stock is meagre, in relative terms.
A glance at the numbers raises questions about the current funding outcome for local roads:
- Local roads represent 80% of all public roads in Australia, by kilometres.
- Yet local road funding from local governments themselves amounts to only 21% of total road funding in Australia in 2008 (BITRE data 2008)
- The Federal Parliament Inquiry into Local Government and Cost Shifting (2003) estimated the stock of local roads alone to be worth over $90 billion
- Yet even by 2006, total Federal grants to local government for road maintenance were less than $2 billion and total expenditure on local roads was only $3.3 billion: (See http://www.aph.gov.au/house/committee/efpa/localgovt/report.htm )
- The rural portion of ‘local’ roads looms large: of the 700 local government areas responsible for maintaining local roads, 405 are classified as ‘rural’ or ‘remote’ (Commonwealth Grants Commission(CGS) estimate 2006)
- In kilometre terms, rural local roads represented 68.7% of all local roads, yet rural local roads received only 34% of total local road maintenance and upgrade funding (CGS estimate 2006, using 2003-04 road expenditure data)
Of course, these numbers give no indication of being ‘right’ or ‘wrong’, but a fundamental feature of the current grant funding system (apart from its complexity) is that road funding bears no relationship to the relative productivity potential of the local roads being funded.