Councils should be banned from hiking rates by more than inflation, a business leader says.
“Tasmanian ratepayers deserve better, as the cost and scope of service delivery shouldn’t vary in a manner which creates unfairness and inequity across council boundaries,” Property Council of Australia Tasmanian executive director and former state Labor minister Brian Wightman said
“The parliament of Tasmania needs to show leadership and tackle the quality, quantity and cost of services across municipal boundaries.
“It is obviously a time for more accountability, which the state government can mandate.”
He said the government should require any rate increases to be directly linked to improvements in service delivery or the provision of infrastructure.
He said they should also be capped to the inflation rate or less.
His comments followed the troubled Glenorchy City Council deciding to hike rates by 12.5 per cent.
That was more than six times the annual Hobart inflation rate of 2 per cent.
Shadow Local Government Minister David O’Byrne called for the government to work with the council to help ratepayers avoid a 12.5 per cent increase.
“It’s not fair,” Mr O’Byrne said.
However, he did not support rate capping.
“The Glenorchy City Council situation is unique and extreme and is an example of where the government and Local Government Minister Peter Gutwein can and should be stepping in,” Mr O’Byrne said.
“However, rate capping would not be workable on a blanket basis across Tasmania.
“Local councils are democratically elected and should retain the capacity to set their own rates.”
Mr Gutwein said: “Rates are entirely a matter for councils and we don’t support rate capping.”
“The government would prefer to see Glenorchy and all other councils ensure that any rate rises are kept to a minimum.”
Victoria’s Andrews Government introduced rate capping, starting with the 2016-17 financial year.
The government capped rate increases at a maximum 2.5 per cent for that year, in line with inflation.
That was after what it called “a decade of uncontrolled rate rises”.
It said rates had been increasing by an average 6 per cent a year, and the cap would lead to a fairer rates system.
The government set the cap at 2 per cent and 2.25 per cent for the following two financial years.
Victorian councils can apply for a higher cap if they can show what the government calls “community support and a critical need for spending on services or projects that requires a rates rise above (the cap)”.
They must convince the state’s Essential Services Commission to approve rates increases higher than the cap.