Max rate rise set

January 13, 2022 BY

Efficiency required: City of Greater Bendigo CEO Craig Niemann said while the rate increase cap is popular among ratepayers, a balancing act is required by the City to manage expenditure. Photo: FILE

VICTORIAN municipalities will again be limited in how much they can put up property rates next financial year, with the maximum allowed remaining under two per cent.

The new rate cap of 1.75 per cent was announced by the State Government at the end of last year, up from the current limit of 1.5 per cent, the lowest since the current process – known as Fair Go Rates system – was introduced in 2016.

City of Greater Bendigo chief executive officer Craig Niemann said the rate cap increase is as expected, as the City looks ahead to the 2022/23 budget.

“We have to work within our means basically, that sets the limit for how much money we can raise in rates and we have to then make up the rest of our revenue through other streams and manage our expenditure accordingly,” he said.

“It does put pressure on the system and our financials but at the end of the day we’ve got a big budget to manage and we have to make sure we tighten the purse strings a little bit here and there to make sure we can work within the constraints that are set.

“This is making it tighter each year, it just means we need to make sure we’re operating as efficiently as we can.”

Mr Niemann said lower rates result in a “balancing act” for the City’s budgeting team to ensure there is enough money to renew infrastructure and provide services.

He said the rate cap is also “slowly impacting” the amount of money available for new capital works projects.

“We have to work really hard to try and get as much State and Federal grant money for new projects… to make sure we get as much taxpayer money as possible brought back to Greater Bendigo to provide those assets to our community,” he said.

While the municipality will look at different revenue streams for income, such as user fees, Mr Niemann said the City will strive to keep services affordable for all residents.

“We’ve got to make sure we’re offering services where we can charge a fee, but the fee is affordable for all people,” he said.

“For example a pool, we can put the pool fee up to make sure the revenue of the pool covers the cost, but we know that would be not affordable for the community.”

Set by the State Government, the rate cap is the maximum rates can increase across the municipality in a finical year.

Councils don’t have to increase rates by 1.75 per cent. For the 2021/22 financial year the Rural City of Ararat cut municipal rates by 1.5 per cent.

Regardless of the cap, some rate payers may see the amount they are billed increase by more than the limit, as individual rates are calculated on property value.