A Local-State Government Spatial Data Sharing Partnership

A Local-State Spatial Data Sharing Partnership Model to Facilitate SDI Development
Many of these sparsely populated local governments are located in the rural areas of
Australia and provide critical infrastructure including roads, housing, water and sanitation.
There were however, many relatively small local governments in highly urban areas which
created obvious inefficiencies. This led to the amalgamation of many of these local
governments in Victoria, Tasmania, Queensland and New South Wales during the past 20
years.
3.4.4 State and Local Government Fiscal Dependency
A significant difference that exists between the tiers of government in Australia is their
level of revenue and expenditure. Federal fiscal arrangements in Australia are
characterised by a significant difference between the relative revenue and expenditure
responsibilities of the Commonwealth and the States, often referred to as vertical fiscal
imbalance (VFI) (Australian Government 2006). In drafting the Australian Constitution, it
was intended that the state and federal governments would be financially independent.
However, since federation the states have become increasingly reliant on the Federal
Government for funding and increasingly subject to its dictates about how revenues will be
spent (Summers 1985).
As Figure 3.3 illustrates, the federal (commonwealth) government collects significantly
more revenue than it expends. This contrasts with the states and local governments which
rely on the federal government to top up their funding base through commonwealth grants.
Figure 3.3 Vertical fiscal imbalance (Australian Government 2006)
Although this vertical fiscal imbalance has created tension between the states and federal
governments in particular, there has been limited success by the states in effecting changes
to redress this situation (Dollery 2002). State governments rely on a redirection of 13% of
federal funds whilst local government outlays consume the whole of their revenue. The
relatively low level of funding to local government is reflected in the facilities and staffing
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