THE City of Greater Bendigo estimates it has lost more than $1 million in revenue due to a freeze on indexation of government grants.
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The federal government announced the three-year indexation freeze on its Financial Assistance Grants in the 2014-15 budget, meaning the funding pools has not increased in line with inflation and population change each year.
City of Greater Bendigo mayor Rod Fyffe said population increase in the municipality had seen the council receive some extra compensatory funding, but in the years since the pause was implemented the council had not received a significant sum it would have otherwise.
Cr Fyffe said the freeze meant the council had been unable to deliver more than nine kilometres of footpaths and more than four kilometres of sealed roads.
He said the council would not recover the lost revenue.
Budget papers indicate indexation will be restored from 2017-18, although the Australia Local Government Association claims the freeze will result in a permanent 13 per cent reduction in the base of the grant program.
The ALGA also said the action had cost councils across Australia $925 million in lost revenue.
Cr Fyffe said the whole community paid taxes and the grants were one way of recouping those, in a way that was very beneficial.