LOCAL government rate rises will be capped at two per cent next year, with Swan Hill Rural City Council advising it will comply with the cap.
This year, Swan Hill Rural City Council introduced a rate rise at 1.02 per cent, in response to “challenging drought conditions” and uncertainty around water availability.
Minister for Local Government Adem Somyurek announced on Friday the government had set the cap on council rate rises at two per cent, guided by the Consumer Price Index (CPI) forecast by the Department of Treasury and Finance for 2020-21.
Swan Hill council director of corporate services David Lenton said council’s rate rise in 2020 would be within the limit set.
“Council has received notification that the state government has announcement it will cap rate rises at 2 per cent next year — our council will comply with this rate cap,” Mr Lenton said.
“Council will set its budget accordingly based on the newly-introduced rate cap.”
Asked if a cap of two per cent placed pressure on council to deliver more with less, Mr Lenton said he was confident service delivery would not be negatively impacted.
“There is always pressure on councils to deliver more with less and we are confident that we can achieve a good balance between service delivery, capital expenditure and council income sources.”
The Fair Go Rates cap has been in place for four years, introduced in an effort to end excessive rate increases, which averages six per cent per annum over the previous decade.
“We said we’d protect Victorians from unfair rates hikes and that’s exactly what we’ve done,” Mr Somyurek said.
“Our Fair Go Rates system has put a stop to a decade of unfair, unsustainable increases that hit hard-working Victorian families.”
“Fair Go Rates is encouraging Victorian councils to improve accountability and transparency, ensuring they are listening to their communities and delivering the services that matter most.”
The cap was set at 2.5 per cent in 2016-17, 2 per cent in 2017-18, 2.25 per cent in 2018-19 and 2.5 per cent in 2019-20.
The cap is also informed by the Essential Services Commission (ESC) who have recommended that it be set at CPI.
Reports by the ESC in 2019 showed that, for the first time, all 79 of Victoria’s councils had complied with the rate cap.
