COUNCIL rates rises will be capped at two per cent for the 2017/18 financial year as part of the state government’s policy to limit any rises to the rate of inflation.
The consumer price index (CPI) was forecast to be two per cent by the Victorian Department of Treasury and Finance.
Local Government Minister Natalie Hutchins decided not to accept advice from the Essential Services Commission recommending a cap of 2.15 per cent for municipalities across Victoria.
The Labor state government pledged to cap rates before Premier Daniel Andrews won office at the 2014 election in a policy it dubbed “Fair Go Rates”.
“In the decade before we introduced Fair Go Rates, council rates increased by an average of 6 per cent per annum. This has now stopped, making things fairer for ratepayers,” Ms Hutchins said in a statement.
“Victorians have told us they want more of a say in council decision-making, and now is the time for councils to speak with their communities about their budgets for next year.”
Mornington Peninsula Shire says it will continue to review services to deliver “value-for-money” programs and projects “within its funding capacity”.
Shire chief financial officer Matthew Green said council “has already introduced measures, including organisational reviews and restructures and purchasing efficiencies to operate within the state government’s rate cap”.
“Mornington Peninsula Shire’s rates remain among the lowest in the state, and the shire will ensure its services and community infrastructure is delivered in a financially-responsible manner,” Mr Green said.
Councils across Victoria can apply to the Essential Services Commission for exemptions from the rate cap if it can be proven rate rises above inflation are needed for specific circumstances.
“Council is yet to consider whether it will apply to the Essential Services Commission for a variation to the rate cap,” Mr Green said.
He said council had abolished the $180 municipal charge last year.
The shire dropped the municipal charge and introduced a waste service charge which it said at the time would ensure a “fairer redistribution of the rate burden”.
The then mayor Cr Graham Pittock said the $193 a property waste charge would raise $19 million, an amount that “fully recovers the cost of collection and disposal of refuse”.
The shire’s 2016/17 income was put at just over $214 million.
The budget also shows shire staffing costs will rise by $3.067 million to $70.094 million – about 30 per cent of total expenditure.