Liverpool Plains Shire Council is currently consulting on a proposed Special Rate Variation (SRV)


At its Ordinary Meeting held 27 November 2020, Liverpool Plains Shire Council resolved to notify the Independent Pricing and Regulatory Tribunal (IPART) of our intention to apply for an SRV in 2021.

This site contains background information on our decision to consult on a proposed SRV, as well as Frequently Asked Questions (FAQs) and other resources that will assist you in making an informed decision. Below is a list of engagement opportunities and guidance on how you can provide feedback through a formal submission.

Background

In 2013, the Independent Local Government Review Panel was established with the aim of ensuring an effective framework for the provision of services and infrastructure to local communities in NSW. The Panel acknowledged that local government works the closest with communities and highlighted how this can be an important factor in achieving local, state and national goals and objectives. The Panel stated that a move to larger organisations, with greater ability to generate increased resources, work at scale and implement more effective ways of operating, would see communities benefit from better infrastructure and services and a stronger link between local and other tiers of government.

In response, the NSW Government instigated the Fit for the Future reforms. The purpose of these reforms was to stregnthen and modernise the Local Government sector, by creating strategic and "fit for the future" councils - councils that are financially sustainble and efficient, with the capacity to effectively manage infrastructure and deliver services, as well as the scale, resources and capacity to govern effectively.

At this time, Liverpool Plains Shire Council explored a merger with the neighbouring Gunnedah Shire Council. However, after consulting with our community, we opted to remain a stand-alone, independent council. Instead of merging with Gunnedah Shire Council, we committed to pursuing efficiency improvements and seeking a SRV from 2017-18 of 19.1 per cent cumulative over three years.

Over the past four years, we have worked hard to achieve efficiencies and productivity improvements, so that we can continue managing infrastructure and delivering services, in line with community expectations. However, we did not apply for a SRV of 19.1 per cent from 2017-18 as originally planned.

Our financial position

Since the Fit for the Future reforms, Council has continued to produce significant operating deficits, while maintaining - and in some cases, expanding and improving - the services we provide.

In the 2019/20 financial year, Council had an operating loss of $3.89 million, a deterioration from the $1.31 million loss in 2018. With capital grants removed, the underlying operating deficit for 2019/20 was $7.13 million ($8.30 million in 2019/20).

Over the past five years, Council has only been able to renew 56 per cent - or just over half – of assets as they fall due. A large proportion of additional funding is required to address the maintenance of our existing public infrastructure, such as roads, drainage and bridges, that we have not had sufficient cash to renew.

What we're proposing

While the Fit for the Future reforms have now drawn to a close, Council has still continued to produce significant operating deficits, while maintaining - and in some cases, expanding and improving - the services we provide.

We are proposing to increase the general rate recurrently by 8 per cent in 2021/22, 8 per cent in 2022/23 and 8 per cent in 2023/24. In total, this is an accumulative increase of 26 per cent.

Our Long-Term Financial Plan and Asset Management Plans have been reviewed to reflect the proposed SRV. These documents (available under "Key Documents") are on public exhibition until Friday, 22 January 2021.

Community information sessions

During the exhibition period, we will be hosting a series of community information sessions across the Liverpool Plains Shire for residential and business ratepayers. These sessions will be COVID Safe with social distancing measures in place, and you will be required to register to attend these sessions.

Location Date Time Venue
Wallabadah 04 January 2021 10.00am - 11.30am

Wallabadah Village Hall
Martyn Street, Wallabadah

Quirindi 04 January 2021 5.00pm - 6.30pm Longfield Pavilion
Henry Street, Quirindi
Currabubula 05 January 2021 10.00am - 11.30am Currabubula War Memorial Hall
Davis Street, Currabubula
Werris Creek 05 January 2021 5.00pm - 6.30pm Werris Creek Bowling & Tennis Club
Henry Street, Werris Creek
Spring Ridge 06 January 2021 10.00am - 11.30am Spring Ridge Hall
Darby Road, Spring Ridge
Premer 06 January 2021 5.00pm - 6.30pm CWA Rooms
Ellerslie Street, Premer
Willow Tree 07 January 2021 10.00am - 11.30am Willow Tree Hall
New England Highway, Willow Tree


Please note that due to a high level of interest in the Werris Creek commnity information session, the venue has been changed from the Railway Institute Hall to the Werris Creek Bowling & Tennis Club.

To confirm your attendance at one of the above community information sessions, please contact Council's Customer Service Centre on (02) 6746 1755 or by email at lpsc@lpsc.nsw.gov.au.

Frequently Asked Questions

IPART is NSW’s independent pricing regulator for water, public transport, local government, electricity and gas industries, as well as the licence administrator of water, electricity and gas, and the scheme administrator and regulator for the Energy Savings Scheme.

IPART also undertakes reviews and investigations into a wide range of economic and policy issues and performs a number of other roles at the NSW Government’s request.

IPART’s functions include setting the annual rate peg, and assessing and determining SRV applications. 

For further information about IPART and its role and functions, visit IPART's website.

On an annual basis IPART reviews council costs and sets a maximum percentage increase councils can apply to their general rates income. This is called the rate peg.

The rate peg is mainly based on the Local Government Cost Index (LGCI) and may include a reduction for productivity gains. The LGCI measures price changes over the previous year for the goods and labour an average council will use. The rate peg applies to existing works and services, and not to new infrastructure and/or additional service needs.

For 2021/22, IPART has set the rate peg at 2.0 per cent.

The rate peg limits the amount councils can increase their rate revenue by from one year to the next. For example, if the rate peg is 2.5 per cent councils can only increase their overall rate revenue by 2.5 per cent. This does not apply to annual charges.

If a council's rate revenue is not enough to maintain service levels, it can apply to IPART to increase overall rate revenue by more than the rate peg. This is known as a Special Rate Variation (SRV).

In order to apply for an SRV councils must demonstrate to the community and IPART that they need the money and have implemented improvements to be more efficient and productive.

SRVs have been used widely in local government over the years because of costs increasing above inflation and new costs emerging. 

For further information about SRVs, visit IPART's Special Variations page.

Through the NSW Government's Fit for the Future reforms, Council was assessed as being "not fit". Although Council has worked to improve efficiencies and increase revenue, we have continued to produce significant operating deficits, while maintaining - and in some cases, expanding and improving - the services we provide.

In the 2019/20 financial year, Council had an operating loss of $3.89 million, a deterioration from the $1.31 million loss in 2018. With capital grants removed, the underlying operating deficit for 2019/20 was $7.13 million ($8.30 million in 2019/20).

Over the past five years, Council has only been able to renew 56 per cent - or just over half – of assets as they fall due. A large proportion of additional funding is required to address the maintenance of our existing public infrastructure, such as roads, drainage and bridges, that we have not had sufficient cash to renew.

The proposed SRV will generate an additional $1.5 million over three years, to be permanently retained within Council's rate base. This revenue will be used to fund our existing services and maintain assets, including:

  • Grading unsealed local roads to meet existing service levels;
  • Additional maintenance of rural roads, such as bitumen maintenance, drainage, patching, roadside slashing, gravel maintenance, and vegetation management;
  • Roadwork and renewal of urban streets;
  • Increased funding to maintain existing services across Council operations;
  • Additional bitumen resealing and gravel re-sheeting to keep our roads at a good standard and prevent them from deteriorating;
  • Culverts, causeways, drainage and footpath renewal; and
  • Community asset renewals (e.g. buildings and park facilities).

We are proposing to increase rates by 8 per cent each for the 2021/22, 2022/23 and 2024/24 financial years. This will have an accumulative effect of increasing the rates by 26 per cent.

The following table shows the impact of implementing the proposed SRV on the average rates by rate category:

  2020/21 2021/22 2022/23 2023/24
Average Residential Rate ($) 772 833 900 972
Average Farmland Rate ($) 4,441 4,796 5,180 5,594
Average Business Rate ($) 1,977 2,135 2,306 2,490
Average Mining Rate ($) 109,947 118,742 128,242 138,501

Pensioners will continue to receive the statutory pensioner rebates from Council and the NSW Government.

While you may not use some large Council facilities and assets, rates are used to maintain and build essential infrastructure such as roads and footpaths. Without an SRV, these services that are used by the majority of people every day will fall into disrepair. 

Council rates are levied on property owners. However, higher rates form part of costs which non-ratepayers may bear, including tenants currently paying rent in the Liverpool Plains Shire, and the cost of goods and services. Infrastructure, facilities and services are provided by Council for all residents of, and visitors to, the Liverpool Plains Shire. Building better infrastructure, facilities and improving services benefits everyone. 

Improved infrastructure, facilities and services benefit tenants and non-residents as well as those living in the Liverpool Plains Shire. All ratepayers of the Liverpool Plains Shire will receive information in the mail about the process and the opportunities to find out more and provide feedback on this proposed SRV and rates. 

If the proposed SRV is implemented, the associated rate increase would apply to all ratepayers, including residents and non-residents. 

Applications for a SRV are assessed by IPART against criteria set by the NSW Office of Local Government.

These criteria state that Council must:

  • Clearly articulate and identify in the council’s strategic documents the need for, and purpose of, the SRV.
  • Ensure community awareness of the need and extent of the proposed increase in rates.
  • Show that the impact on affected ratepayers is reasonable.
  • Ensure that Council’s strategic documents are exhibited and adopted by Council.
  • Council must explain the productivity improvements and cost containment strategies that have been realised and are planned to be realised.

Council will decide in early February 2021 if it will make a SRV application. If an application is to be lodged, it must be submitted to IPART by 08 February 2021. IPART will determine the application in May 2021.

 

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