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Ratepayers Victoria: Rate-capping: The Truth is out there!

The Municipal Association of Victoria has, unsurprisingly, issued a press release to undermine Rate Capping. Ratepayers Victoria has countered this with the following arguments: When the rate capping policy was developed and adopted, all official communique and documentation, were very clear upfront in stating that rates capping only apply to general rate and municipal charges. Other council service charges, fees, fines and differentiated rates, together with prevailing state levies (e.g. the fire Levy councils advocated for and changed to CIV rating system a few years back.) The Fair Go Rates policy is a real present and future threat to some councils, as it has taken away councils’ free reign of rates increases and require them to be more transparent any) are excluded.

The Minister also specifically said that in some cases, ratepayers will find their rates bills would increase more than 2.5% (the capped level) because of the changes in their properties’ capital improvement value and other increases in municipal charge-outs that are not subjected to the rates cap.

[The Fair Go Rates policy] is most accountable in supporting and sustaining a fairer rating system that would deliver more visible value for money services and maintain rates affordability in the longer term. Because of this threat, most councils have come together with their peak bodies, even during the development of the rates capping policy, to defend their turf. Their lobbying campaign is still continuing and growing strong despite the policy is now legislated and operating.

What Municipal Association Victoria didn’t come clean about in its 30 June media release is that rates capping can work if councils are committed to make it work. It is most inappropriate and lacks good governance behavior to continue influencing the public to think and eventually lead them to believe that the rates capping policy does not work.

The last two years of media stories clearly showed the anti-Fair Go Rates policy lobby resolve to campaign against and discredit the Fair Go Rates policy. These stories, together with local ratepayer-advocates’ reports, revealed the use of:

- media and community communication strategies, to create a series of related news and messages to socially engineer people into believing that rates capping has caused more harm than good to councils and their communities, e.g. like cutting out the school crossing services,
- diverting council funds to support collaborative projects with peak bodies, which duplicate state services e.g. the Alliance For Gambling Reform
- many internal cost shifting tactics, to ensure the parts of council-budgets constrained by rates capping are reduced or kept unchanged, in order to minimize rates reduction. For the next financial year, some councils have already and blatantly introduced new or increased existing charges, fees and differentiated rates that are not affected by rate capping.

Many people do not understand how their council rates, rates capping levels and fire levy are structured and calculated. It is easy to leverage this low community literacy and convince people that the State Government has mislead them, because their total rates payable for the next financial year is above the capped level of 2.5%. Now, in a time of political flux, just after the election, is strategically timely to leverage political pressure in any public communication broadcast.

Ratepayers are disappointed that some of their councils and their peak bodies are not willing to make rates capping policy work, eroding the opportunity of achieving longer term community and organizational improvement benefits for every stakeholder in Local Government.

Let’s cut to the chase, ratepayers would like councils and their peak bodies to stop winching up charges and resisting the rates capping policy. They should be more focused to commit to the Fair Go Rates policy and make it work to increase efficacy in council operations and bring more visible best value outcomes in municipal service. Change is incremental and to expect full delivery of long term benefits in the first year of the Fair Go Rates policy is most misleading and laden with manipulative intents.

Adapted from a press release from Rate Payers Victoria, 'The Truth is Out There' (30 June 2016).