Union claims council rate cap costs jobs

A union claims local government rate caps are detrimentally affecting essential community services and local economies.

However, Baw Baw Shire was not prepared to comment “at this time” on a claim by the Australian Services Union that the caps have cost 61 jobs in the shire.

The union, that represents most council workers, said a report it commissioned said the number of jobs lost in Baw Baw ranked second highest in Gippsland behind Latrobe City’s 84.

Across Gippsland’s six municipalities it estimated the number at 330.

Baw Baw’s chief executive officer Mark Dupe said the rate cap the Essential Services Commission had set for 2022-2023 limited rate increases to 1.75 percent.

He said the council’s budget process for the next financial year was underway taking into account the cap on rates with a draft budget proposed to be considered at a council meeting on April 13.

Mr Dupe said council had received the report commissioned by the ASU but “has no commentary on it at this time”.

Rate capping was introduced by the state government in 2015 under its Fair Go Rates system.

Victorian ASU secretary Lisa Darmanin said councils were now covering funding shortfalls with revenues from other sources, such as user fees and fines, that were growing more than twice as fast as they were before caps were enforced.

Local government is an important employer of choice in regional Victoria and could be providing even more high quality middle-income jobs, she said.

Ms Darmanin said local communities know what they need and don’t need interference from government in Melbourne.

She described rate capping as a top down, one size fits all approach at the expense of democratic decision making and local jobs and services.

Report author Dan Nahum of the Australian Institute’s Centre for Future Work said there was no evidence the caps were protecting ratepayers and residents, rather they caps hurt them.

“There is no evidence the caps make councils more efficient”.

“Instead, they take money from much needed council services and rob local communities of employment opportunities”.

That results in high fees collected through other revenue tools and reduces local government expenditure flowing back into the private sector, Mr Nahum stated.

The report said there were now 3000 fewer local government workers in Victoria than eight years ago although the state’s population over the past decade had increased by more than 20 per cent.