Rate cap plan misguided: Mayor

Published on 12 May 2014

Loddon Shire Mayor Cr Gavan Holt has come out swinging at Labor’s proposal to cap council rate increases to CPI, saying the plan is unsustainable and beyond reason.

Announcing the policy, Victorian Opposition leader Daniel Andrews said any council wishing to raise rates above CPI would need to apply to the Essential Services Commission for approval.

Loddon Shire’s rate increase this financial year was 5.5 per cent, while the CPI sits at 2.9 per cent.

Cr Holt said any such move would be a seriously backward step for the Shire, forcing a rethink of Council’s long-term financial planning and posing a threat to Council services and infrastructure projects.

“Loddon’s current annual rates income of $8.6 million goes a very long way,” he said.

“Thanks to some extra government support, our capital works program this year alone will see $8.42 million spent on road works, public buildings and plant and equipment.

“Then there’s $2.5 million for home care services, $740,000 for township street improvement and streetscapes, $808,000 on economic development initiatives and Council’s ongoing commitment to community planning of $750,000.

“Council pays for state-legislated emergency management planning, mitigation and recovery activities. It also funds the Shire’s five kindergartens – statewide, councils have invested $240 million to upgrade 1,100 preschool facilities worth $6.5 billion to meet state and federal standards.

“Add in free maternal and child health check-ups, maintaining and improving our swimming pools, footpaths, bridges, halls, parks and sports facilities, monitoring food safety, providing public toilets, bins, waste collections, street lighting, school crossing supervision and more and you can see it’s a long list.

“The rises in Commonwealth and state taxes over the past decade have been well above inflation, and much more than has accrued for Councils, yet local government still collects only 3.5 cents of every tax dollar raised nationally.

“The suggestion that Council costs to deliver community services or maintain roads and facilities is somehow related to inflation is plain wrong.

“Each year, Council has to find 3-4 per cent more to deliver the same level and range of services, thanks to the inevitable growth in construction, material and wage costs, as measured by the local government cost index.

“The irony is that our residents really do not want a cutback in Council services.

“Last year, the annual community satisfaction survey conducted for the Victorian government showed Loddon rated at 68 per cent approval for overall performance, compared with 59 per cent for small rural shires in general.

“That’s seven out of every 10 people surveyed saying Council is doing a good job – no other level of government can boast that level of popularity.

“Of course, Loddon Shire has to be constantly on the ball with budget matters and cost savings are part of that, but rate capping is not the answer. “