By CAM LUCADOU-WELLS
GREATER Dandenong Council needs to find $3 million in savings in its June budget to comply with the State Government’s rate-capping policy.
Councillors have agreed not to apply for a rate cap variation and so bound the council to a rates rise of no more than 2.5 per cent – equivalent to CPI.
Mayor Heang Tak said the council faced a “big shortfall” in its financial plans.
The council would not have details on budget cuts until it completes a review in May, he said.
Australian Services Union state branch secretary Richard Duffy warned of the cumulative pain of rate capping.
Over the next five years Greater Dandenong would suffer a $50.1 million projected funding cut and $219 million in the next decade, he said.
“History has shown councils do not adopt a ‘business as usual’ approach when faced with financial challenges such as rate capping.
“Inevitably, infrastructure is run down, capital works projects are deferred or abandoned, services are cut and ultimately jobs are lost.”
Councillor Matthew Kirwan said the council would try to absorb the revenue slump in 2016-17 “but I’m confident that that is not sustainable”.
He said the council would be more dependent on state and federal grants for major infrastructure if it didn’t seek a rates-cap variation in future years.
Cr Tak noted that even under the rates cap, some ratepayers would face rises significantly more than 2.5 per cent due to a municipality-wide property re-evaluation.
“All properties will be revalued this year, so if your property value has increased by more than
the average in Greater Dandenong, you will pay a higher amount in rates.
“But if your value has increased by less than the average, your rates will be lower.”
Cr Tak said the council didn’t apply for a variation because there was not enough time to conduct the required “high level of community consultation” before the Essential Services Commission’s March deadline.
He noted the State Government’s landfill and fire services levies – both collected on rates notices – were not subject to the rates cap.
