RESIDENTS struggling to pay council rates are being sued by Wyndham Council at “alarming levels”, a new report from community legal centres claims.
The council sued 435 people over unpaid rates last financial year, the equivalent of 2.8 in every 1000 people.
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That’s down from 690 in 2008-09 — a rate of 5.2 per 1000 people and the highest in the state.
The report, by the Federation of Community Legal Centres, raises concerns that councils are too quick to sue over unpaid rates instead of exploring alternatives or investigating if residents are suffering genuine financial hardship.
Victoria’s 79 councils brought about 6000 people before the courts for unpaid rates last financial year, triple the number of eight years ago.
Wyndham Legal Service manager Denis Nelthorpe said the report named Wyndham, Melton and Frankston as the most-prolific litigators for claims under $10,000.
“If you compare Wyndham to the City of Greater Dandenong, which is the most disadvantaged demographic area in the state, they only sue at a fraction of what Wyndham does,” he said.
“This is purely about whether councils have in place a proper financial hardship process.”
Mr Nelthorpe said councils had a “long way to go” to meet ethical debt-collection policies in place in other industries.
“Councils sue more often than banks, telcos and utility providers, which demonstrates this problem is purely about whether councils have in place a proper financial hardship process,” he said.
Wyndham mayor Heather Marcus said ratepayers in debt were sent six letters chasing arrears before the matter was taken to court. While each letter advised the ratepayer to contact the council if they were struggling to pay rates, people rarely did so.
“Over the past few years, Wyndham City has seen an increase in the number of ratepayers not discussing their outstanding rates and charges directly with the council until after action with the magistrates court has commenced.”
Cr Marcus said Wyndham offered a year of hardship relief to eligible ratepayers, which may waive debt recovery costs, interest and accept a minimal payment plan in line with their financial circumstances.
When truck driver Ian Bishop’s work hours were trimmed, he and his wife fell about $2500 behind in paying their rates.
Melton Council took them to court where Mr Bishop offered to repay $25 a week. The council’s solicitors refused and demanded at least $75 a week. “We’ve admitted the bill is there,” he said.
“We’ve never shied away from it, but all we want is a fair shake of being able to try and fix it.”
Mr Bishop, who is now considering selling his property, said council hardship policies were too forceful.
“Give people a chance to be able to repay in a manner that they can manage, especially with rising unemployment and the way the economy is going at the moment. It just seems like it’s their way or that’s it.”
