Last year I explained why I would not be voting for a 4% rate rise at Kingborough Council.  Unfortunately, this year I’m saying basically the same thing.

Last night Council passed yet another 4% rate rise.  I voted against it.

Further, it adopted a new Long Term Financial Plan which plans to increase rates by 4% every year over its 10 year span.  I voted against that too.

An average Kingborough home-owner paying $1,270 in 2015-16 would be paying almost $1,900 by the end of the plan.

The $63 Barretta waste levy that had been in place for the rehabilitation of the former landfill site will not be charged from 2016-17, however it will be replaced by a new stormwater charge of $56 per property.

What was pitched as a short-term levy for a specific purpose (Barretta rehabilitation) will now be made permanent, albeit slightly smaller and with a new purpose of upgrading stormwater infrastructure.

Improvements from last year

Since last year two positive things have happened in relation to Council’s Budget:

1. Council is conducting an efficiency review (of sorts)

Council has commenced a 'service delivery review'.  While the review has no set timeframes or targets, it’s a good start.  I'll continue to pursue information about its progress and effectiveness. My ambition is to have targets from this process embedded into the next version of the long-term financial plan, therefore bringing about lower required rate rises.

2. Council's Budget process

Unlike last year, there were legitimate avenues for Councillors to raise items for potential savings.  I raised expenditure items across arts, Councillor expenses, memberships, tourism promotion and other miscellaneous items worth a little under $400,000pa which would have brought the rate rise needed in 2016-17 to 2%. However, I was unable to gain enough support for these from my fellow Councillors.

Challenges ahead

The most important thing that this Council will do is get the Budget back to surplus. While that isn’t happening this year, the plan does get Council back to a budget surplus earlier than had been anticipated.  Council has no debt, but has been running deficits since the global financial crisis.  This is not sustainable for much longer.

The other important aspect in the longer term is funding for depreciation of assets. This is where Council sets out funding for renewal of infrastructure assets. Over the past decade or so, Kingborough has only been funding this at 80% of expected depreciation. The new plan increases this to 90% from 2020, but 100% funding remains some way off as Council continues to run deficits.

We continue to see large deficits from the Kingborough Sports Centre with the forecast deficit up to $560,000 in 2016-17 from $430,000 this year. This is a very large burden for Council to continue to carry. While the centre is a great example of investing in preventative health, at what point does the burden on ratepayers become too much and user charges need to be increased?

Likewise, the Kingston Twin Ovals is a magnificent asset for the Kingborough Community, but the costs of maintaining it far outweighs the revenue Council receives from it. We gratefully receive State and Federal funding to build these facilities, but then put the significant burden of operating and maintaining them onto ratepayers.

Summary

Expenses continue to increase and there is no appetite from the majority of Councillors to review the programs Council runs.

While I accept they have been elected the same way I have, I do not accept that there is broad community support for the continued focus on increasing revenue, rather than addressing expenditure.

Quarterly rates notices can have a significant impact on families. The 10-year plan would add an additional $600 per year to family expenses at its completion. I cannot accept that’s the best way forward.

Most people I talk to have very limited interaction with Council outside of having their garbage collected and local infrastructure like roads, footpaths, stormwater and parks maintained. They tell me they do not want to see the continuation of rate rises above CPI over the long-term.

Last year, I also said it would be a good idea to have the economic regulator approve rises over CPI on the 29 monopoly Councils.  There appears to be no appetite for that in State Parliament, but it shouldn't be ruled out as an options if Councils are going to continue to simply raise revenue to match expenses.