Déjà vu as Adelaide City Council unveils its latest budget proposal | Bruce Djite

Another year, another unaffordable Adelaide City Council rate hike that seems designed to squeeze every ounce of life and vibrancy from our city, writes Bruce Djite.

Adelaide businesses are facing a 7.4 per cent rate rise. Picture Dean Martin

A sense of déjà vu has washed over residents of Adelaide as its City Council unveils its latest budget proposal.

Another year, another council rate hike that seems designed to squeeze every ounce of life and resource out of the very people who contribute most to our city. Here we go again.

A staggering proposition of a rates increase of up to 7.4 per cent is destined to cripple families already battling a cost-of-living crisis and small businesses and landlords struggling to recover from significant losses and debts accumulated during the Covid-19 pandemic.

Frankly, this is a flashing, angry red light for Adelaide’s economic future.

Lord Mayor Jane Lomax-Smith last week was quoted as saying: “We need to go through this budget with a sharp knife and do a lot more cutting”. She is correct – the current economic strategy will only lead the city to die a death by a thousand cuts.

It is small and local businesses, the beating heart of Adelaide’s character and economic vibrancy, who will feel this betrayal the most. Already struggling in a changed CBD environment post the pandemic, this will lead to the prospect of scaling back their activities, laying off staff, and as we are already witnessing with hospitality businesses, even shutting their doors entirely.

Local businesses are already struggling in a changed CBD environment. Picture: Dean Martin

Last year the Property Council, along with key members, met with the Lord Mayor and warned her in person that rate rises would lead to business failures in the CBD. We also reiterated this in our City Council pre-budget submission where we said: “If rates are increased this will require ratepaying businesses to be more profitable. This increase would come at a time when fewer people are coming to the CBD, discretionary spend is down, staff to deliver services are more difficult to recruit and the impact of inflation and recessionary headwinds is significant.”

This council has too many single issue-obsessed candidates who clearly lack any financial and economic acumen and can no longer be trusted with bringing growth and vibrancy to our great city. It is no secret that South Australians have long been disillusioned with local government – a 33 per cent statewide voter turnout is just the tip of the iceberg when measuring care factor. When ratepayers hear their hard-earned cash could be spent on projects including tree planting at $20,000 a pop, and a proposed $150K statue, who can blame them?

Especially when combined with council-imposed red tape on development as well as community engagement – need we bring up the Adelaide Comets and the farcical approval process for their fence?

Compounding the problem are rising interest rates set by the Reserve Bank of Australia. We’ve already seen a wave of business failures in construction, hospitality, and retail – industries that are particularly vulnerable to rising borrowing costs. With consumer spending and household consumption on the decline, there is no wonder this announcement has the community up in arms.

Here we go again, potentially pushing even more businesses over the edge and putting further strain on the local economy.

The solution? There is only one: Growth, growth and more growth. The council should enable, not stymie, development. There needs to be more development, more residents, more businesses to grow the city’s ratepaying base and the economy. Economies of scale are important here. This council may not be economically or business minded, but surely the Lord Mayor and her motley crew can read the room and not crush the hopes and dreams of their constituents with a rate rise of up to 7.4 per cent – more than double the recent monthly CPI.

South Australia has a state government that has made considerable efforts, and indeed progress, in attracting growth through visitors, events, the university merger plan and of course recent defence announcements, all of which will support the city. LIV Golf and Gather Round have already demonstrated that innovative, ambitious and out of the box thinking can drive increased CBD vibrancy.

Maybe it is time the state government intervened in the matters of the City Council as the dominant body which makes so many decisions for our CBD.

Here we go again. This should not be the reaction to the council’s budget proposal. It’s time for a new chapter. One that prioritises responsible spending and innovative solutions to foster a city that works for everyone.

The residents and businesses of Adelaide deserve better.

* Bruce Djite is SA executive director of the Property Council of Australia.