Capping rate rises at the consumer price index will disadvantage the Wyndham community into the future, according to the council.
In a recent submission to State Parliament’s planning and environment committee, the council said it did not support the state government’s plan to cap rate rises at the level of the consumer price index from next financial year. The council said the new rating rules would limit the amount of revenue available to build infrastructure.
The submission said Wyndham council would be required to deliver about $2.4 billion of infrastructure over the next 30 years, as set out in development contribution plans for Melbourne’s growth areas. And with developer contributions to those projects anticipated to be about $1.54 billion, that would leave a gap of $86 million for the council to fund.
The council submission said capping rate rises would impact on its ability to bridge that gap.
The council is also concerned about the impact of declining state and federal grants on its income in the coming years.
The submission said that if rate rises were capped at CPI and government grants continued to decrease, the council would be left to plug significant revenue gaps.
Cr Gautam Gupta said the council faced a dilemma in trying to balance the increased demand for services and the decreasing financial support.
“The cost increases we are facing in providing services are not measured by CPI and increase by more than CPI,” he said.
“We can’t continue to provide services without rates increases above CPI.”
This year, Wyndham residents are facing a rates increase of 5.5 per cent.
The state government is maintaining that the cap is not about restricting councils’ abilities to provide infrastructure but rather cutting waste and increasing accountability.
It maintains that councils that have community support and can demonstrate they are raising and spending ratepayers’ money responsibly will be able to exceed the cap.
