Victorian Labor will force councils to cap their rates at Consumer Price Index (CPI) and justify any further increases.

Councils wishing to raise their rates above CPI must appeal to the independent Essential Services Commission (ESC) and justify any rate increases.

Under Labor, councils increasing their rates will be accountable for how they spend ratepayers’ money.

The ESC will determine whether rate increases are fair, and will take into account:

• Any extraordinary circumstances (e.g. natural disasters, new functions)
• Other sources of income available to the Council and their overall financial position
• The continued maintenance of essential Council services

If the ESC believes the rate rise is unreasonable, it will recommend to the Minister for Local Government that the increase be blocked.

At the moment the ESC makes sure that Victorians pay a fair price for gas, water and electricity. It is the sensible authority to determine council rates.

Quotes attributable to Mr Andrews:

“Under Labor, councils will be forced to limit rate rises and detail where every dollar will be spent, because ratepayers deserve a fair go. The days of ratepayers footing the bill for Arnold Schwarzenegger impersonators are over.

“This policy also sends a clear message that we expect councils to keep their rates in line with CPI, any increases above this must provide a clear benefit to ratepayers.

“With the cost of living increasing and Tony Abbott and Denis Napthine increasing taxes, homeowners and businesses can have confidence that they aren’t footing the bill for wasteful or unnecessary council spending.”

Key Facts

• Labor will amend the Local Government Act to require that draft budgets are submitted to the ESC before they are adopted.
• These additional powers will ensure that councils are properly managing their budgetary responsibilities, and not hitting ratepayers with unsubstantiated or excessive rate increases.