WA councils could lose control over the size of future rates increases, after Local Government Minister Tony Simpson announced at the recent Local Government Association annual general meeting the Government would consider capping council rates at CPI to put downward pressure on rates rises.
Mr Simpson said action was needed to curb rate increases across the metropolitan area growing much faster than CPI.
He also proposed rate settings could come under the control of the Economic Regulation Authority, which would scrutinise rate rises to determine whether they were justified.
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READ NOWBut chief executives for Mandurah and Murray, Mark Newman and Dean Unsworth, strongly oppose the proposal.
Mr Newman said rate capping not only threatened local government sustainability but demonstrated poor policy by blaming local government.
"The City of Mandurah worked hard to ensure a minimal rate increase of 3.4 per cent in its recent budget, but due to rapid population growth and extensive cost-shifting by the State Government, we have no choice but to raise rates to meet community needs," he said.
"We are very aware of financial stresses in the community and the argument to consider increases in line with CPI should be one for debate by the democratically elected body, not one forced on it by a government that does not practise this philosophy. Rate capping is not good financial management.
"It will be detrimental to the future of local government and we need to challenge this because ultimately we are fighting for our community's future."
Mr Unsworth said capping rates increases would have a severe impact on the delivery of services and infrastructure on a shire experiencing significant growth, such as Murray.
"We would need to reduce services to a guaranteed inability to fund the necessary infrastructure and infrastructure backlogs, meaning assets would depreciate more quickly.
"Utilities such as power, gas and water have increased at many times the rate of inflation, which is an additional cost to be passed on to ratepayers
"Funding increases from the Fire and Emergency Services Levy have not kept up with the increasing costs of managing emergency services, and services to youth, seniors and the disabled, once the responsibility of the State, are slowly being transferred to local government."