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‘Your Say, the soft sell for rate increase’

by Palerang Councillor Peter Marshall

“Fiscally sensible actions like installing renewable energy, or disposing of unneeded assets to pay down debt, sit on the ‘to do list’.”

The soft sell for real rate increases in Palerang seems to have commenced, as evidenced by the Mayor’s [September] column, and the hard sell won’t be far behind.

There are genuine reasons for councils to need to increase rates – each year NSW IPART calculates CPI then subtracts 0.1% or so from it as a so-called ‘efficiency dividend’, the end figure being what council can increase rates by each year.

The federal government has frozen its grants to councils since 1 July 2014, and the cumulative effect of that real cut will be large. But ask how much rates need to rise to make up for those real cuts and you can hear cicadas. Ask why local government costs (in particular road costs) increase more than CPI, and the cicadas get louder.

It is absolutely clear to me that before pushing our hands deeper into ratepayers’ pockets, we first need better financial management. Shiny new projects like car parks, recreation grounds and bridges are funded from various sources, often the inevitable gift-horse-barrel from living in a marginal state and federal seat.

They are also often partly or fully funded from loans, with no information on what source the loan will be repaid from. But you should look a gift-horse in the mouth, if you’re going to be responsible for the feed, farrier and veterinary bills.

Ask for whole of life costs for the infrastructure, such as depreciation, maintenance and running costs (and interest for the ones funded by loans), and the cicadas are starting to get quite annoying. Meanwhile, fiscally sensible actions like installing renewable energy, or disposing of unneeded assets to pay down debt, sit on the ‘to do list’.

We won’t get better financial management until a majority of Palerang councillors start practicing it and demanding it. Unfortunately for the ratepayer, the rates increase is likely to be set in concrete before the next council election, so you’ll only be able to punish us for it, not prevent it.

 

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