The Tasmanian Government has told a House of Representatives committee on regional Australia that federal funding for road maintenance has remained static for 15 years as costs rise.
The government in a submission to an inquiry wrote the National Land Transport Maintenance contributed significantly to the maintenance and renewal of Tasmania's road network.
"However, the annual level of funding has been relatively fixed at $7 million over the last fifteen years and represents about half of the Tasmanian Government's maintenance expenditure for the network," it said.
"In real terms the funding contribution is decreasing as actual maintenance costs increase."
The committee has been tasked to look into the social and economic aspects of regional parts of the country, including the creation of new towns and cities.
The government informed the committee that Tasmania was at the beginning of a significant growth period and could shoulder the population burdens of mainland cities.
It said decentralisation of government services away from mainland cities gave corporations confidence they could establish themselves, and do business, in regional locations.
Kevin Turner, from Regional Development Australia Tasmania, raised with the committee several issues for regional areas.
He said when regions focused on chasing the next big thing, they could forget their comparative advantages and strengths.
He said regional economies suffered boom and bust cycles when they became too dependent on one industry.
Mr Turner said the window for investment in regional Tasmania was narrow and opportunities were often too small in scale for corporate investors.
He said this problem could be addressed when the flow-on benefits to the state's small and medium business enterprises attached to large projects - which was a key objective of RDA Tasmania.