East Gippsland Shire Council will take a major advocacy motion to the Municipal Association of Victoria (MAV) State Council in October, calling for a national Sovereign Wealth Fund funded by natural resource revenues to support regional infrastructure.
The motion seeks statewide support from local councils to advocate to the Victorian and Commonwealth governments to recognise Australia’s finite natural resources as public assets owned by current and future generations.
Under the proposal, the fund would be capitalised through royalties and taxation streams generated from resource extraction and renewable energy projects.
East Gippsland Shire mayor Cr Jodie Ashworth said the initiative aims to ensure regional communities receive a lasting benefit from the wealth generated in their backyards.
“Regional communities play a vital role in supporting Australia’s economy through agriculture, energy production, transport corridors and resource-related industries, yet too often they are left carrying the long-term impacts without receiving a fair share of the benefits,” Cr Ashworth said.
Council argues that returning a defined share of resource royalties directly to regions would reduce reliance on short-term, competitive grants. Instead, it would allow local governments to deliver planned, long-term investments in roads, bridges, drainage, housing-enabling infrastructure, climate adaptation, and disaster resilience.
“A Sovereign Wealth Fund would provide a practical way to create a lasting legacy for future generations, while helping communities manage the infrastructure, environmental and economic impacts associated with growth and resource development,” Cr Ashworth said.
The proposal highlights the growing financial pressures confronting regional councils across Victoria, including surging construction and maintenance costs, expanding infrastructure requirements and cost-shifting from higher levels of government.
Cr Ashworth emphasised the proposal would not replace existing funding programs, but rather complement them.
“This would be additional to current funding arrangements. It is about creating a long-term investment vehicle that delivers ongoing benefits to communities and helps reduce reliance on short-term, competitive grant programs,” she said.
“Communities that host extractive industries, renewable energy projects and major transport corridors often experience lasting impacts on local roads, land use, agriculture and community infrastructure. It is only fair that a share of the wealth generated is reinvested into those regions.”
The motion draws on international precedent, pointing to Norway’s Government Pension Fund Global, which has grown into the world’s largest sovereign wealth fund by reinvesting oil and gas revenues for long-term national prosperity.
Cr Ashworth noted the alignment between sovereign wealth funds and local government planning cycles.
“Councils are responsible for assets and infrastructure that serve communities for decades,” Cr Ashworth said.
“We need funding models that look beyond annual budget cycles and election terms and support the long-term prosperity and resilience of regional communities.”
