New South Wales councils are still calling for the removal of rate pegging, despite a new method of determining the rate cap limit.
The new rate peg of 2.8 per cent was announced in December by the Independent Pricing and Regulatory Tribunal (IPART).
“For many years, the Associations have been calling for the rate cap figure to be based on a Local Government index and determined by an independent body such as IPART,” said President of the Local Government Association Councillor Keith Rhoades.
“This new system provides much more transparency and accountability, and produces a better outcome for Local Government in the long run.
“Despite this, the 2.8 per cent rate cap still falls well short of the real cost increases facing Local Government, making it difficult for councils to meet the growing service and infrastructure needs of local communities.
“We’re grateful that this announcement has been made much earlier than previous years as it gives councils more time to work on their management plans and prepare their submissions for rate variations.
“But the reality is that the rate cap is simply not enough to cover our escalating expenses, let alone address the $6 billion infrastructure renewal backlog we currently face.”
Councillor Rhoades said that while the figure is in line with the current CPI, councils already have to deal with an inadequate share of taxation, as well as $440 million every year for costs shifted by other spheres of government.
“With the New South Wales State election looming, there has never been a better time to get rid of rate pegging all together, and the Associations will be lobbying hard to get the major political parties on board,” he said.
“We’re the only State in Australia that is constrained by rate pegging, so it’s time to get into line with the rest of the country.”
