Rates debate is a hot topic

Modest increase: Shire of Northam chief executive Jason Whiteaker and the council have adopted a 2.25 per cent rates increase for 2019/20.
Modest increase: Shire of Northam chief executive Jason Whiteaker and the council have adopted a 2.25 per cent rates increase for 2019/20.

I also believe local councils need to explain clearly why they might propose rate increases and justify this with their community.

WA local government minister David Templeman

Homeowners across Western Australia have received, or are waiting to receive, a letter from their local council that few will relish.

The annual issue of local government rates is hotly debated in the media, around dinner tables and at community gatherings - with 2019-20's offering no exception.

With people doing it tough and household bills showing no sign of reducing, council rates add an extra financial burden on WA families.

Those in local government argue rates are needed to fund infrastructure projects in our suburbs and to add requested facilities in our communities.

They say rates allow the council to provide essential services, empty our bins and maintain our public spaces.

With inflation rising, local government representatives also say rates must increase as a consequence.

However, a public debate has been ensuing this year around the issue, with many people suggesting if local councils were more stringent with existing funds, the need for rates hikes would not be there.

Talk of a rates freeze has also been coined.

With our rates notices having arrived or in the post, this week we have looked at how this area compares to others across WA.

The Shire of Northam will increase 2019/20 rates by 2.25 per cent, despite it initially seeming that a 3.5 per cent increase was likely.

The 2019/20 draft budget shows that a number of major projects will be funded, including significant road network upgrades, refurbishment of the council's administration building and money for the Baker's Hill Fire Shed.

The Shire of Toodyay has adopted a 2.5 per cent rise, with president Brian Rayner saying this amounted to an average increase of $42 per year for residential properties.

The money collected will be used to fund major projects including the construction of a new recreation precinct, the Coondle Nunile Fire Shed and upgrades to the Morangup Community Centre.

"The Shire of Toodyay continues its commitment and support for community groups and organisations," Cr Rayner said.

"Some of the local groups who will benefit include Youthcare, Noongar Kaakning Aboriginal Corporation, Bindoon Mobile Recovery and Toodyay Bowling Club."

Shire of York residents are also facing a 2.5 per cent increase, with president David Wallace admitting keeping costs down for residents was a priority for the council.

"While a 3 per cent increase to rates was advertised as part of the review of the Corporate Business Plan, council has prioritised projects in order to reduce the increase to 2.5 per cent," he said.

"Again, we've sought to deliver a responsible budget that takes into account community expectations while keeping the rates increase to manageable levels."

Rate increases of between 2 and 2.5 per cent seem to be typical in both metropolitan and regional areas.

At the higher end of the scale, the City of Rockingham's rates have increased 3.6 per cent and the Town of Port Hedland have had a 4 per cent spike.

On the other side of the coin, the City of Melville have only approved a 1.1 per cent rise.

In the South West, Shire of Dardanup residents will be hit with a 4 per cent increase, with the City of Busselton adopting a 3.95 per cent jump and the Shire of Harvey passing a 3.5 per cent hike.

The City of Bunbury and Shire of Capel both passed a 3 per cent increase, while the Shire of Collie had the most modest jump in the region at 1.55 per cent.

The Western Australian Local Government Association (WALGA) is the peak industry body representing councils across the state.

WALGA president Lynne Craigie said rates formed an essential part of local government revenue and their capacity to fund infrastructure and services for the benefit of their community.

"Together with their communities, councils make a decision on the level of services they wish to provide, assess their costs and the revenue they can secure from other sources and set rates according to what is required to deliver the agreed level of service," she said.

"To impose a freeze on rates would place undue pressure on councils' long-term financial management, a process already under pressure from diminishing contributions by other spheres of government.

"In other jurisdictions, rates caps have proven to have adverse impacts on infrastructure renewal.

"In some cases, when rates are kept artificially low by a council, significant increases are then required a few years later in order to 'catch up' on the renewals that were deferred as unaffordable at the time."

Local government minister David Templeman said council rates were an emotive topic and he could see both sides of the argument.

"Many people are doing it tough at the moment and tightening their belts," he said.

"The McGowan government has made some tough decisions to freeze the salaries of politicians and public servants and I would urge local governments to follow our lead.

"Local governments are large independent bodies and are responsible for managing their budgets. As such, the state government has no role in the setting of rates.

"I fully understand the arguments behind freezing rates and I am sympathetic to those who advocate for them.

"However, I also understand the complexities of local government budgeting and the flow on impact rate freezes can have on local sporting, community and charity groups who rely on subsidised support from the sector.

"I also believe local councils need to explain clearly why they might propose rate increases and justify this with their community.

"I am currently undertaking a review of the Local Government Act 1995. Submissions to the second phase recently closed, and we are currently analysing responses in relation to rate setting, and investigating options.

"People who are unhappy with their rates notice can request a review of the gross rental value of their property, which is the basis for their rates, and of course they can have their say at the local government elections in October.

"Councils are required to advertise their rates and people should express their views to their council if they don't agree with what is proposed."