The Local Government and Shires Associations of NSW (LGSA) has received a positive response from  to  all political parties its proposal for a referendum seeking the addition of Local Government to the Australian Constitution.

President of the Local Government Association, Cr Keith Rhoades, said that all parties now support an amendment to allow the Australian Government to directly fund Local Government. 

"We're particularly delighted that the Coalition have committed to our proposal for a referendum to include a reference to Local Government in the Australian Constitution," said Cr Rhoades.

"Labor and The Greens signed a formal agreement following the federal election in 2010 agreeing to a referendum to recognise Local Government in the Australian constitution. This was a significant and exciting decision for Local Government across the country, and we're pleased it has now been reinforced at a state level in the responses to our Election Priorities," he said.

"The Coalition and the Greens have given strong support in their response, acknowledging the vital role Local Government has to play in the delivery of essential services for the communities of NSW."

"NSW Labor have agreed to support the proposal in principle, and we hope that they will follow the agreement received nationally from the Prime Minister and support the referendum in practice."

Prime Minister Gillard committed to holding a dual referendum on the constitutional recognition of Local Government and the recognition of Indigenous Australians in the current parliamentary term.

The LGSA, the Australian Local Government Association (ALGA) and other state Local Government Associations have been working together in developing the case for constitutional reform.

Councils across Australia are endorsing ALGA's proposal to demonstrate to Federal and State Governments, and oppositions that the position has widespread support within Local Government.

President of the Shires Association of NSW, Cr Bruce Miller, said that the LGSA's preference is simply to add the words 'and local government' to the funding section of the Australian Constitution.

"It's clearly in the best interests of our local communities that the Australian Government - whoever is in office - has the ability to fund councils directly to accomplish national objectives," said Cr Miller.

"Our rural communities have been without adequate funding for many years, and in recent times we have welcomed with open arms successful federal direct funding programs such as Roads to Recovery and the Regional and Local Community Infrastructure Program," he said.

"These programs have been critical in building and renewing crumbling infrastructure. Constitutional recognition of Local Government will ensure that they continue in the years ahead."

For a copy of the LGSA's NSW Election Priorities 2011, and background on the LGSA's preferred model for constitutional recognition of Local Government and the full response from all political parties on this and other issues, visit www.lgsa.org.au/election2011.