Mr Crean said Labor's commitment to recognition of local government in the Constitution was strong and long-held and that the Expert Panel's work would play an important role in informing the community on the issue and assisting the Government on the best way forward.
Mr Crean said it was vital to protect the Commonwealth Governments ability to directly fund local government.
"Our experience with programs like Roads to Recovery and the recent stimulus package demonstrate the importance, the appropriateness and the advantages of being able to provide funding directly to local government," Mr Crean said.
"Local government was in a unique position to provide shovel ready projects and the ability to directly fund those projects was important to the success of the stimulus and the roads program in delivering jobs and much needed infrastructure.
"We also know that the ability of the Commonwealth to directly fund local government can create a relationship that supports, facilitates and drives collaboration among all three levels of government.
"It can also leverage additional investment in the regions which is good for local communities and for the country."
Chaired by former Chief Justice of the NSW Supreme Court, the Hon James Spigelman AC QC, the Expert Panel was asked to identify options for the constitutional recognition of local government and report on the level of support for constitutional recognition in the community.
A majority of the Panel members found that financial recognition is the only option with a reasonable chance to succeed at a referendum, provided steps are taken to secure the support of the States and achieve broader public awareness and engagement.
"The Expert Panel consulted widely with stakeholder groups and the community to look into the options for including local government in the Constitution," Mr Crean said.
"I thank Justice Spigelman and panel members for their efforts in implementing a national consultation process and for delivering their findings within the given timeframe."
Mr Crean noted the Federal Coalition's support for the recognition of local government and, in particular, the ability of the Commonwealth to fund local government.
"The Government will now take time to consider the community's views and details of the report before providing comment in early 2012."
The Government appointed the independent Panel in August 2011, with representatives from a range of backgrounds and areas of expertise.
The Panel's report is available at www.localgovrecognition.gov.au