6 November 2023

Upper Lachlan Shire Council abandons rate hike plan, saying it has 'heeded the people'

| Claire Sams
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Upper Lachlan Shire Council Mayor Pam Kensit (left) said the “community had spoken” against the proposed rates increase. Photo: Upper Lachlan Shire Council/Facebook.

Upper Lachlan Shire Council has hit the brakes on its plan to increase rates after a community backlash.

In a statement released on Sunday (5 November), Mayor Pam Kensit confirmed the rate increase was no longer going ahead.

“Upper Lachlan Shire Council ran six engagement sessions for the community and have heard clearly what many ratepayers had to say,” Councillor Kensit said.

“As we live in a democracy, we as the community representatives have heeded the people and will not be going ahead with the proposed Special Rate Variation.

“Essentially, the community has spoken and we have listened, with a majority of councillors agreeing to end the process now.”

The Independent Pricing and Regulatory Tribunal (IPART) sets a maximum amount each year (a rate peg) that determines how much councils can increase rates.

If they want to go beyond this limit, councils need to apply and have their claim for a Special Rate Variation (SRV) assessed.

The council had agreed to support an in-principle rise of an SRV at an Extraordinary Meeting in July 2023.

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It had engaged AEC Group to carry out an independent assessment of its financial position and possible SRV options.

AEC Group proposed three options – rates kept at the rate peg, an SRV implemented over one year, or an SRV spread over three years.

Under the proposed plan, it is assumed there will be a rate peg increase of 3.50 per cent in the 2024/25 financial year, then 2.50 per cent in each of the following two years.

AEC Group found Upper Lachlan Shire Council had a consolidated net operating deficit (excluding capital grants) for the 2020/21 and 2021/22 financial years, and budgeted deficits were expected for 2022/23 and 2023/24.

The deficit was due to “other services and infrastructure within the General Fund”, according to the Key Findings report.

“A key expense item which has increased is depreciation, which has increased due to new and upgraded assets, as well as a general increase in the valuation of assets,” the report says.

“Depreciation can not be reduced [not without disposing of assets] and the increase in depreciation indicates that the council needs to plan for more costs in maintaining and renewing assets into the future.”

The rate increase would have come into effect in the 2024/25 financial year.

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Council CEO Alex Waldron said that while the process had been stressful, consultation on the proposed SRV had been necessary.

“Upper Lachlan Shire Council has many hardworking staff and councillors who should be respected for going above and beyond for their community rather than being vilified for being part of a process aimed at improving the shire,” he said.

The council has also shelved further community sessions, including one in Crookwell, as the SRV application has been cancelled.

The decision to cancel the SRV application comes as Goulburn Mulwaree Council continues with its plans for a proposed increase of either 43.5 per cent next year and 2.5 per cent the following year, or 25.5 per cent next year and 20.5 per cent the following year.

Further information on the proposed SRV and the reports from AEC Group are available on the council’s website.

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Well done to the Upper Lachlan Council for ditching the proposed rate hike (which was enormous!). The figures seemed to all based on zero federal grants, which will be & are oncoming. The Council needs to look at streamlining & making our rate money go further, esp in these tough times. Thanks for listening to the ratepayers. 👍

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