A cap on council rates would hamper the delivery of essential services, says Hume council.
In December, Local Government Minister Natalie Hutchins confirmed the Andrews government would impose caps on council rates at the level of the Consumer Price Index (CPI), as promised before the November 29 election.
Councils wanting to raise their rates above CPI would be required to appeal to an independent Essential Services Commission.
“Local residents have enough economic pressures on them with increased costs of living, and increased council rates just make life tougher,” Ms Hutchins told Star Weekly last month.
“Tony Abbott and the Liberals are already increasing taxes and charges on Victorians and local councils shouldn’t make it worse.
“Councils will have to focus on the services people need, not the stunts that drive up rates.”
Hume acting chief executive Margarita Caddick said restricting rate increases to the CPI did not account for the broad range of local government responsibilities.
“To restrict rate increases to the annual CPI increase – 2.3 per cent between September 2013-14 – would constrain the delivery of council services, community programs and the expansion and renewal of community infrastructure,” Ms Caddick said.
She said the council was working with the Municipal Association of Victoria and the Interface Group of Councils to provide advice to Ms Hutchins on the limitations of rate rises tied to the CPI.
“There is a range of factors that influence cost increases in a council budget, including population growth, the spread of population and the need for services and facilities to be spread throughout a municipality, the ageing of infrastructure and the need for new infrastructure in developing residential areas,” she said.
Hume council’s 2014-15 budget, adopted last June, came with a rates rise of 4.5 per cent.
Whittlesea council said it was unable to comment until the CPI rates policy was drafted or passed and details were released.
