By CAM LUCADOU-WELLS
CASEY Council has said it will not increase rates by “higher than normal” in 2015-2016 ahead of next year’s rate cap.
Last week the state government repeated its election pledge to cap rate rises to the consumer price index from mid-2016.
It has stated that councils must apply to the Essential Services Commission to raise rates higher than CPI.
Annual CPI rose 1.7 per cent up to the December 2014 quarter, well below Casey’s average rate rise of 7.5 per cent in 2014-2015.
Last year Casey increased the amount of money it raised through rates by $13 million, to a total of $177 million.
Analysis by the Journal News estimates that the increase would only have been $3 million if the cap had been applied.
Casey Mayor Mick Morland said the council would not seek to apply for a “higher than normal” rate increase in the 2015-2016 budget – a year before the rate cap is due to be applied.
He said the cap would not impact on the $125 million Casey Cultural Precinct project.
“Through many years of responsible financial management, council can build the Casey Cultural Precinct without an increase to rates.
“Council will use a combination of savings, a loan and external funding to fund the project.”
Cr Morland said Casey had “particular pressures” providing new infrastructure and services in growth areas.
“The Essential Services Commission will be given the responsibility to review council’s budget to ensure ratepayers get value for money – this is consistent with the objectives of the City of Casey.”
Municipal Association of Victoria chief executive Rob Spence said councils would be forced to take “drastic action” such as staff and services cuts.
“The general movement in costs for councils is about 1 per cent more than a consumer’s basket of goods.
“The state government has a mandate to deliver (rate caps). We have to make sure it doesn’t damage services and activities.”
Ratepayers Victoria president Jack Davis, in backing rate capping, said most of councils’ costs were administrative.
“Stating services would be cut is hogwash.
“The administration should look at cleaning its act up and being more efficient.”
The state government has stated the cap was designed to protect ratepayers from “wasteful or unnecessary council spending”.
Any rate rises above CPI “must provide a clear benefit to ratepayers”.
In 2014, Casey’s value of overdue rates was $10.1 million, or 5.9 per cent – up from 4.3 per cent in 2009.
The council has a financial hardship policy to assist ratepayers who are finding it difficult to pay their rates.
