Parliament urged to oppose reforms that will hurt communities
The Municipal Association of Victoria (MAV) is calling on political parties to oppose four elements of the Local Government Bill when the reforms are debated in Parliament this week.
Cr Mary Lalios, MAV President said local government had supported and embraced many of the reforms put forward by the Victorian Government to modernise the legislation, however a number of proposed changes would hurt local communities for no perceived benefit.
“Currently councils are allowed to use one of three methods to value land for the purpose of establishing how much each property owner contributes in rates. The Local Government Bill proposes that all councils except the City of Melbourne should use Capital Improved Value.
“Residents in four municipalities – Maribyrnong, Port Phillip, Whittlesea and Yarra – could be hit with rate rises as high as 10 per cent if this reform gets through Parliament.
“These four councils currently use Net Annual Value (NAV), which is the annual rental return a property would receive, less the landlord’s costs – or five per cent of the CIV for residential properties and farms. NAV values commercial and industrial properties higher.
“By removing the option to use NAV, the Government is shifting an unaffordable rates burden from non-residential properties to residents in the affected municipalities. This is an unexpected and unfair tax hit that families in those communities simply cannot afford,” she said.
“We’re also concerned about the adverse impacts facing rural communities, and in particular farmers if the Government’s proposal to reduce municipal charges is supported by the Victorian Parliament.
“Councils can currently set a municipal charge of not more than 20 per cent of their total rates revenue. The Government seeks to reduce this to 10 per cent without a compelling reason for the change.
“A municipal charge is used by councils to collect a portion of rates that is not linked to property value, but is a flat amount paid equally by all ratepayers.
“For farmers, this reduces their total overall rates contribution and they are only required to pay a municipal charge once if they own multiple farm properties within a municipality. If the municipal charge is reduced from 20 per cent to 10 per cent, it will hurt our farming community.
Cr Lalios said councils also support the current electoral system, which allows unsubdivided, single-member wards, uniform or non-uniform multi-member wards, or a mix of single and multi-member wards.
“The Government has ignored feedback from local government and seeks to require a council to either be unsubdivided or consist of all single wards or all uniform multi-member wards.
“This reform does not provide the flexibility that is vital to recognise local circumstances and dispersed populations, particularly in rural areas. It could significantly change how communities are represented.
“Victorians can expect better local representation when electoral boundaries reflect the composition of their community, not an arbitrary rule about uniform ward options that ignores communities of interest.
“Lastly, councils want to retain the ability to set appropriate rates rather than enshrine rate capping in legislation. We urge the Opposition, minor parties and independent MPs to oppose these reforms,” she said.
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For further information, contact Cr Mary Lalios on 0447 189 409 or MAV Communications on 9667 5521.