The peak body for local government in New South Wales has criticised calls for people to simply not pay rates in response to proposed increases in some council areas.
Local Government NSW (LGNSW) President Mayor Phyllis Miller OAM said that while no one enjoyed paying rates or taxes, boycotting was not the solution.
“Councils do not make the decision lightly to put forward a proposal to increase their rates. We care deeply about our communities and we work hard to provide the infrastructure and services they need and deserve,” Mayor Miller said.
“When a council does decide to propose a rate rise, they have looked at other options and these applications are fully reviewed by the Independent Pricing and Regulatory Tribunal (IPART), before they determine what increase a council may bring in, if any, above the rate peg,” she said.
“Councillors are very aware of the added financial burden this causes for their communities but deciding not to pay council rates is not going to help. The fact is that the financial sustainability of councils has been undermined by cost shifting, rate pegging, and other factors for over 40 years. These factors increase the burden on councils and reduce their ability to raise the appropriate revenue for community service delivery,” Mayor Miller said.
“LGNSW has long been warning of the numerous threats to the financial sustainability of local government – the most prominent being rate pegs restricting income and the growing practice of cost shifting, where local councils are continually picking up the bill for State and Federal services,” she said.
“Cost shifting burdens councils and impacts their ability to provide essential services and infrastructure for their communities. LGNSW’s most recent cost shifting report estimated this to be equivalent to $1.36 billion in 2021-22. This is the equivalent of $460 per ratepayer annually,” Mayor Miller said.
Mayor Miller highlighted the support available to the public if people find themselves struggling to pay their rates notice. “All councils have provisions on compassionate, or hardship, grounds for payment of rates. We would encourage anyone experiencing financial difficulties to contact their local council to discuss their circumstances,” she said.
Mayor Miller said that councils were subject to layers of state and federal government regulation and annual financial and performance-based audits conducted by the NSW Audit Office, as well as having Audit, Risk and Improvement Committees.
“LGNSW has supported external reviews of local government and has actively taken part in them. We welcomed last year’s report handed down by the NSW Parliament’s Standing Committee on state development which recognised that the financial sustainability of councils is being persistently eroded and that, without improvements, all communities will suffer,” Mayor Miller said.
