Ratepayers across current LGA were out of pocket $39 million or the equivalent of $379 per ratepayer, in the 2021/22 financial year due to cost shifting from the NSW Government, the Council has stated
The figures were derived using the methodology from the latest cost shifting report produced by independent consultants, Morrison Low on behalf of LGNSW for the 2021/22 financial year which calculated an amount of $1.36 billion in costs has been passed on to councils across NSW.
See; 2021–22 Cost Shifting Survey
This is an increase of $540 million since the last report from the 2017/18 financial year under the previous coalition government.
The Minns NSW Government announced on March 5, 2024 a newly formed Stakeholder Reference Group will advise the NSW Government as it reforms the way emergency services are funded.
The group will provide a broad range of expert perspectives on a new model to replace the existing Emergency Services Levy (ESL), which is paid through insurance premiums.
The Cost Shifting Report states Council paid the highest Emergency Services Levy in 2021/22 at $6.4 million ($62 per ratepayer), which is 28% more than the next highest Council (Central Coast Council at $5.0 million). Council’s Emergency Services Levy has increased to $9.3 million this financial year, equivalent to $90 per ratepayer.
Council has stated it will write to the Premier, the NSW Treasurer and the NSW Minister for Local Government requesting that they urgently seek to address the costs through a combination of regulatory reform, budgetary provision and appropriate funding.
Mayor Sue Heins said increasing cost shifting put a huge burden on the financial stability of local government.
“Every dollar we pay in levies and subsidies to the state government, is one less dollar we can put into our local roads and footpaths, our parks and community centres or our libraries and events programs.
“Put simply it constrains our ability to maintain our community infrastructure and sustain the same level of service to our community. Our Asset Management Plan (2022-2032) identifies an infrastructure funding gap of $151 million over 10 years.
“This is further exacerbated by recent high inflation and the $3.1 million increase in costs to Council associated with the Emergency Services Levy this financial year.
“Our community deserve better and this must stop.
“I encourage the government to consider how this cost shifting is resulting in lost services, lost opportunity and lost amenity for NSW residents and businesses and do something to fix it.”
Mayor Sue Heins
The community can review the summary and full reports on the LGNSW webpage
President of Local Government NSW, Cr Darriea Turley AM, said the findings of the report are alarming and should shock every ratepayer.
“It’s just not acceptable for the State Government to use local councils as a piggy bank for State programs and services,” Cr Turley said.
“This is effectively a $1.36 billion dollar tax on every ratepayer in NSW.
“At a time when councils are still rebuilding after the natural disasters of the past few years, the last thing they need to be doing is paying for State Government obligations too.”
The increase in cost shifting has been accelerated by various State Government policies, with the most significant examples of cost shifting in 2021–22 being:
- The waste levy, which remains the largest single contributor to cost shifting in NSW, totalling $292.9 million.
- The Emergency Services Levy and associated emergency service contributions, which totalled $165.4 million and represented the largest direct cost shift to local councils.
- The NSW Government’s failure to fully reimburse local councils for mandatory pensioner rate rebates, resulting in councils losing $55.2 million.
- The NSW Government’s failure to cover the originally committed 50 per cent of the cost of libraries, resulting in an additional $156.7 million in costs to councils.
Cr Turley said the cost shift amounted to a rate burden of $460.67 on every ratepayer in NSW which is up to 50 percent of their total rates bill in some local government areas.
Councils hardest hit include Berrigan Shire Council in the Southern Riverina, Clarence Valley in the state’s north, and Inner West, Lane Cove and Woollahra councils, all in Sydney.