Kiama Municipal Council Mayor, Cameron McDonald, is calling for answers from the NSW Local Government Grants Commission over proposed cuts to Commonwealth Financial Assistance Grants.
At a time when Kiama Municipal Council is working under the constraints of the NSW Government’s Varied Performance Improvement Order (PIO) and the organisation battles to close its budget deficit by 2026-27, Mayor McDonald (pictured) said he was “stunned” at the prospect of the funding cuts.
“After waiting many years for a review of the methodology for financial assistance grants to see our funding slashed by more than half – right when we are trying to improve our financial position – beggars belief,” said Mayor McDonald.
“This will have an enormous impact on a council the size of ours.”
The Office of Local Government has informed councils statewide of the proposed changes to the Commonwealth Financial Assistance Grants funding distribution methodology by the NSW Local Government Grants Commission.
The independent Commission has proposed a radical overhaul, which if adopted would see Kiama’s annual allocation slashed by more than half.
Kiama received $2.558 million in funding under the financial assistance grants system in 2025-26, including a local road component of $790,761. Under the proposed methodology, the overall figure would be slashed to $1.062 million with $451,804 allocated to roads.
Mayor McDonald said it was unfair for a regional council like Kiama, particularly one that is already navigating the complexities of the state imposed PIO to be subjected to further cutbacks.
“Our community knows all too well the immense pressure from the NSW Government that we are under to deliver a balanced budget and meet the requirements of the state’s PIO,” he said.
“We simply can’t afford to go further backwards, and to lose out on more than 50% of our funding.
“Kiama needs that money to maintain services our communities expect. I’m outraged by these proposed cuts on behalf of our whole community. It’s just not fair and it’s not good enough. Ratepayers can’t just be expected to financially absorb shocks like this quietly.”
The Mayor said the Council would make a submission to the Grants Commission with its concerns.
“The engagement process has been limited and details on data sets driving the new methodology are scant, so I am not surprised that many councils are confused and unhappy.”
“There has been a total lack of detail and justification for such significant cuts.
“Our residents deserve to know why their funding has been slashed to half to what it was previously,” the Mayor said.
