Rate capping passed in Victorian Parliament
Last week the Local Government Amendment (Fair Go Rates) Bill was passed in Victorian Parliament without amendment. It was disappointing that the Bill received unanimous support from the Opposition. The Greens voted against it.
The Minister is required to set the cap in December after consultation with the Essential Services Commission (ESC) and take into account the State Treasury CPI forecast due to be provided by the year’s end.
We know there will be a number of councils, particularly in rural Victoria, that will find rate capping very difficult. It will have a significant impact on their communities unless the State Government provides them with additional funding, or the process of making a case to the ESC to go above the cap becomes a realistic option for councils.
The ESC Chairperson, Dr Ron Ben-David, presented at the MAV Rate Capping Forum last week on his expectations should a council need to apply to the ESC to go above the cap. We remain hopeful that this process will not be onerous or costly.
The consequences of the implementation of a rate capping model will be discussed at length at the next meeting of our Rate Capping Taskforce in early 2016. We will closely monitor the impact of rate capping and we encourage councils to be open and honest with communities regarding the consequences that rate capping will have on the level and quality of services.