Cities jump the rate peg

NOW that Newcastle and Lake Macquarie councils have been given permission to raise rates above the legislated annual cap, ratepayers will expect those organisations to strive harder than ever to provide value for money.

The Independent Pricing and Remuneration Tribunal (IPART) has approved Newcastle City Council’s application for a one-off increase of 8.6 per cent – or five per cent above the 3.6 per cent rates cap for next financial year.

The city will use this extra income to fund several long-awaited projects, including its art gallery redevelopment, upgrades to Blackbutt Reserve and swimming pools, improvements to cycleways and the revitalisation of Hunter Street.

Lake Macquarie City Council’s controversial application for annual increases ranging from 10.44 per cent down to 4.75 per cent over the next seven years had amounted to a cumulative increase over that period of 73.24 per cent.

IPART judged that rise too much for the community to swallow, but approved the increase the council put forward as its ‘‘option two’’ – a still substantial increase of 57.48 per cent over seven years. By the end of that seven-year cycle, the average Lake Macquarie ratepayer will be paying the council an estimated extra $524 a year.

According to IPART, ‘‘this special variation will have a more reasonable impact on ratepayers, yet still allow the council to improve its financial sustainability . . . and make progress on addressing its maintenance and infrastructure backlog while maintaining current levels of services’’.

IPART also commended the council on its community consultation, and while some council critics might struggle with that, nobody can say that Lake Macquarie ratepayers have been left in ignorance of the council’s proposals.

Newcastle’s approved rate rise means it has permanently increased its rate base, but IPART has made the increase conditional. That includes annual reporting on its progress on the nine special projects it put forward as justification for the rise.

The council will also be required to outline the productivity savings it has been able to make.

The last thing the community needs is for these additional funds to simply be absorbed into expanding council running costs as a result of lack of budgetary discipline.

Both councils must be aware that, whether or not IPART calls them to account over their use of these extra funds, ratepayers will be watching intently. The public expects good value for money from its major local government organisations and will react badly to evidence that this is not being provided.

RUGBY fans in the Hunter have a historic opportunity tonight.

The Test match between Australia and Scotland at Hunter Stadium is an exciting first for the region and will pit an overhauled Scottish side against the solid mid-season Wallabies.

It’s likely to be standing room only at the ground, and the atmosphere is certain to be electric for players and crowd alike.

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