As part of the federal budget, the Abbott government announced the program would not be indexed for the next four years, remaining at $2.28 billion a year until 2017-18.

Deputy mayor Chris Gryllis said Orange received $4.5 million from the commonwealth as part of the program and rural councils would feel the pinch most.

“We’d already budgeted for CPI into the future, that’s $135,000 in the first year, and around $500,000 over the next three or four years,” he said.

“We’ll be looking closely at how to deal with this loss of funding.”

Cr Gryllis said council would look at the detail in the coming weeks to make the most of funding opportunities, but there were some positives in the budget, including the $11.6 billion infrastructure growth package.

“I can’t recall a budget where everybody has said, ‘yes, that will do me’, but there will be some goodies for us and we will have to see if we can get some of that $11.6 billion to use for our infrastructure,” he said.

Cr Gryllis said the $5 billion asset recycling initiative would provide incentives to encourage the states to sell assets and put the sale proceeds into new infrastructure.

“The new premier has indicated asset sales are already on his agenda, and any practical encouragement to put those proceeds into long-term infrastructure to boost productivity rather than a short-term budget fix is a good move.”