Some NSW councils will be keen to start lifting rates after a reform bill was tabled in parliament. 

The Local Government Amendment (Rates) Bill was introduced to NSW Parliament this week, implementing the Government’s response to IPART’s review of the rating system and a range of other changes.

The proposed legislation will also assist councils to harmonise rates across multiple local government areas that had been merged by the NSW Government in 2016. 

Harmonisation will be phased in over four years to avoid rate shock.

Rate harmonisation across former councils should see both residential and business rates from the old council areas calculated fairly and consistently across the new local government area.

“Allowing sufficient time for local governments to harmonise rates puts everyone on a level playing field, on an orderly path, and is a critical step in ensuring the merged councils are able to levy rates in the fairest and most transparent way possible,” Local Government NSW President Linda Scott said. 

“The reforms are welcome, however, the journey of rate reform has a long way to go to ensure councils can start to deliver core infrastructure and services effectively beyond special State Budget project grants.

“Rate pegging is crippling councils and must be removed.

“According to the Government’s own NSW Productivity Commission, cumulative negative impacts of over 40 years of rate pegging include an estimated $15 billion in rate revenue forgone when compared to Victoria.

“We have called on government to end this antiquated method of determining rates, as well as a range of other reforms such as allowing councils to recover Emergency Services Levy independent of pegging.”

Separately, the bill proposes the introduction of superannuation for mayors and councillors from 2022.

The main point of the reform package include;

  • Allowing 17 councils created in 2016 to gradually harmonise rates over up to four years to help protect ratepayers from excessive and sudden rate rises

  • Allowing councils to levy special rates above the rate peg for infrastructure jointly funded with other levels of government, without IPART approval

  • Allowing councils to create more flexible residential, business and farmland rating subcategories to enable them to set fairer rates that better reflect access to services and infrastructure

  • Giving councils the option to make superannuation payments for councillors from July 2022

  • Maximising voter participation in council elections by allowing the timeframe for receipt of postal votes to be extended

  • Extending the term of chairpersons of the State’s 10 country councils to two years, in line with council-elected mayors