Council Reform

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EXPERT INSIGHT

Minister for Local Government, Hon Shelly Hancock MLA, has released a draft Bill for public consultation to implement reforms to the rating system for councils and ratepayers.

The draft bill contains a mechanism to allow councils to seek rate rises in response to population growth. This is supported.

The new mechanism will incentivise councils to accept additional growth and increased density and give local government the ability to respond to increasing expectations for its role as a community service provider.

The draft Bill, if made, will also allow councils to levy special rates above the rate peg for infrastructure jointly funded with other levels of government without IPART approval. This is also supported as it will allow for the efficient sharing of the cost of infrastructure delivery when the benefits extend beyond a precinct, suburb or council area.

The current rate pegging system has meant that Councils with growing populations have been strapped for cash and have progressively pushed more and more costs onto developers and new home buyers. These additional costs are passed onto new home buyers – often those young people who can least afford the extra costs.

Mr Forrest said he was disappointed some of the of the additional proposals in the draft bill appeared to run counter to affordability outcomes. Limiting postponement of rates on rezoned land and charging rates on land that is required to be protected under conservation agreements is likely to add to the risk and costs of delivering new homes and jobs in NSW.

Urban Taskforce will analyse the contents of the draft Bill over the coming weeks. We will likely urge the Government to reconsider some aspects of the draft Bill to avoid disincentivising investment in property and employment - the last thing we need during the COVID-19 economic downturn.

Tom Forrest is the CEO at Urban Taskforce Australia
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Urban Taskforce CEO, Tom Forrest, today acknowledged the NSW Government’s progress in implementing their response to IPART's review of the local government rating system.

urban.com.au

Government’s draft Bill to reform council rating system is a mixed bag

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Victoria's Minister for Local Government, Marlene Kairouz, has introduced the new Local Government bill 2018 be which, if passed, will repeal some legislation relating to local governments and amend other acts.

The new bill would repeal the City of Greater Geelong Act 1993, amend the City of Melbourne Act 2001, the Local Government Act 1989 and the Victorian Grants Commission Act 1976.

Spring Street is characterising the new bill as one that lifts the standards of governance in councils across the state and makes councillors more accountable to ratepayers.

According to a state government media release, the Local Government Bill 2018 will:

<blockquote>
Give the Minister for Local Government the power to suspend individual councillors who pose a significant threat to the governance of a council for up to a year

Clearly define sexual harassment under the Councillor Code of Conduct and introducing the power to remove councillors for serious sexual harassment

Allow mayors serving two-year terms to be ousted from their roles, following a motion moved by at least three-quarters of all councillors in office

Include new measures to ensure service charges levied by Councils do not exceed the cost of those services
<cite>Victorian State Government media release</cite>
</blockquote>

The legislation will also require councils to start laying out budgets in the same way as state and federal governments do - provide forward estimates which extend out to 4 years.  This is an Australian-first.

Mayors will be required to annually report how councils are tracking against the new four year budgetary plans.

Consultation on the new legislation has been <a href="https://www.localgovernment.vic.gov.au/our-programs/local-government-act-review">underway for three years</a> however the emphasis on defining sexual harassment has obviously taken on more zeal in light of the scandal with the former Lord Mayor of Melbourne, Robert Doyle.

On top of the four year council plans and four year council budgetary process, councils will also be required to devise a long-term community vision, a ten year financial plan and a ten year asset plan.

"We want councils focused on the long-term and these changes will help them do exactly that," the minister said.  “We are bringing this Act into the 21st century – helping make councils more accountable and focused on the needs of their communities.”

Lead image credit: <a href="https://commons.wikimedia.org/wiki/File:South_Melbourne_Townhall.jpg">Wikipedia</a>.
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