CITY OF GREATER GEELONG 2012-2013 Rating StRategy

Historic Overview of Annual Rating Strategy
Decisions
2002-2003
Following the 2002-2003 Budget and striking of rates using the 2002 revaluations, Council received
considerable negative response from ratepayers whose rates had significantly increased above the 5.7%
average movement.
In response, Council in October 2002 adopted a ‘Rates Assistance Plan’ offering a range of support,
including extension of interest free terms, easier arrangements for hardship and deferral applications and
significantly, a one-off rate relief of up to $300 for qualifying ratepayers under the hardship provisions of the
Local Government Act 1989.
2003-2004
For the 2003-2004 Budget, Council established a consultation process with a Community Rates Forum held
in June 2003. A report to Council in July 2003 recommended a number of legislative amendments and
administrative action.
Council pursued legislative amendments that would give flexibility within the rate setting framework including
a general capping of rates, power to set a minimum rate and changes to the four times rule.
Despite Councils considerable effort, the Local Government (Democratic Reform) Act 2003 included none of
Councils proposals and legal advice concluded that the amendment to Section 171 of the principal Act
provides for no additional flexibility for capping rates per se as a result of significant valuation movements.
At the National Conference of the Australian Local Government Association, in November 2003, Council put
forward a motion to move towards an “income assessed” method of rating for Local Government, which
received little support. The ALGA represents the Local Government industry nationally and delegates are
councillors, elected and appointed by ratepayers.
In November 2003 a NATSEMA study 1 indicated that Australia’s ageing population held significant wealth in
housing with the younger generation holding less housing assets and greater debt arising from soaring
higher education fees, higher house prices along with job insecurity and cuts in welfare. The so called
“generation X” are likely to pay higher taxes to meet health and welfare costs of an ageing population. Any
move to reduce the property tax burden will simply shift that burden to lower cost housing owners and
tenants. Again, more likely to be the younger generation.
The State of the Regions 2003-2004 2 report identified regional cities in Australia with growth potential and
that one of the biggest demographic shifts - retirees moving to desirable locations such as the coast - would
ultimately depress those economies. The report indicated that while retirees will have lower disposable
income they will require higher support and infrastructure needs which can drain resources from Local
Government.
The problem of inter-generational debt and tax burdening has been described by the Federal Treasurer as
“one of the largest challenges which is confronting our society”.
Similarly affecting the rates and charges levied by Council, is the extent to which cost shifting from Federal
and State to Local Government has occurred in recent years. Council’s submission to the Federal Inquiry 5
estimated that costs upwards of $20 million per annum or some $220 p.a. per ratepayer has been “shifted”
onto Council and in turn its ratepayers and clients using fee paying services.
Council urged the State Government to increase the pension rebate to bring it more in line with increases in
other states. The State Budget in May 2004 provided for an increase to the pensioner concession rebate
from $135 to $160 commencing 1July 2004 to be indexed annually.
2004-2005
As part of the administrative action plan, Council worked in conjunction with ministerial officers to develop a
comprehensive Rating Strategy for 2004-2005. The strategy included a number of key strategic issues
considered with feedback via public submission and community forums.
Rating Strategy 2012-2013 Page 9