Central Coast Council defends rate hike extension as maintaining ‘status quo’

A council has defended a move to extend a massive rate rise for an additional seven years, despite it forcing some of those struggling the most to fork out valuable dollars to repay its huge debt.

Central Coast Council has labelled its move to extend the rate hike from the budget blowout for another seven years as seeking the “status quo”.

Council’s Administrator Rik Hart has come out in defence of the plan which sees the current rates, which were extended by 15 per cent in 2021, maintained until 2031.

This means coast residents will be footing the bill for council’s financial crisis – which saw the organisation plummet half a billion dollars into debt – for a decade.

However, Shadow Local Government spokesman Greg Warren rubbished council’s claims residents wouldn’t be impacted at the hip pocket.

“This is devastating news for families across the Central Coast, who simply won’t be able to afford to pay their rates,” Mr Warren said. “To suggest this bid is maintaining the status quo is ridiculous, and further punishing the community for mistakes they didn’t make.”

Mr Warren argued Central Coast Council’s financial woes were a result of the “failing forced amalgamation process”. 

“The people of the Central Coast should not have to pay for the mistakes of a government policy — the NSW Government needs to step in and stop this.”

Mr Hart has issued a statement saying that he wanted to dispel misinformation in the community, saying the application to Independent Pricing and Regulatory Tribunal (IPART) seeks to maintain current rates as opposed to seeking a year-on-year rate increase.

“Council is not seeking an increase on top of what ratepayers currently pay in the ordinary rate,” he said.

“We are seeking a continuation of the status quo for a further seven years. That is to maintain the current rate structure for a further seven years, ten years in total. This is consistent with our original application to IPART last year.

Local rates notice letters came out this week with an explainer letter from the council.

“This does not mean a further rate increase as the temporary Special Variation of 15 per cent (including rate peg) determined by IPART in May 2021 is already included in the rates which people are paying in the current year.”

Mr Hart said if approved, the only difference the ratepayers will see from July 1 2024 is IPART’s annual rate peg.

He also reiterated that not going down this pathway will result in a loss of $26m per year and cuts in services, staff and the ability for council to meet its debt requirements.

Council officially approved its application to IPART at an extraordinary meeting on February 3 with Mr Hart strongly stating “there are no more rate increases.”

Bensville’s Kevin Brooks – also a member of the Protest Against Extreme Rates of Central Coast Council group – described the move as “slugging the ratepayer”.

“Rik Hart is once again engaging in spin,” he told the Express.

Central Coast resident Kevin Brooks.

“If he wasn’t applying for another rate hike he wouldn’t be applying at all because councils don’t apply to IPART for anything else.

“This latest rate hike application will slug ratepayers an extra $200m between 2024 and 2031 compared with what IPART agreed just last year. That’s why IPART itself has called it a ‘significant rate increase’.”

The protest group has been urging its members to make a submission to IPART on the proposed extension.

One member described the council’s latest move as a “scare campaign to make us fall in line with further rate rises”.

“This was caused by the State government and they need to be held accountable,” he said.

“Once again penalising the lower end of the scale, is the ratepayers. It’s always the common folk who are held to ransom.”

Another member agreed that the State Government should pay for the council’s “horrendous decisions”.

The protest group formed when Dick Persson AM announced the 15 per cent rise in 2021.

“Rik Hart is trying to reassure us that they are not asking for ‘another’ increase, they just want it for seven more years!!,” she said.

Earlier this week, IPART confirmed that council has submitted its paperwork for the extension describing Central Coast Council, along with two other NSW councils, as seeking “large increases”. Community feedback on the application is open until March 7.

“Last year we received over 6000 community submissions on special variation applications. We also expect a high level of community engagement this year,” IPART Tribunal Chair Carmel Donnelly said.

“Councils are required to demonstrate the need for the additional revenue, evidence of community consultation and an assessment of the impact on affected ratepayers.”

She said IPART would determine the applications by mid-May. To lodge a submission visit the IPART website.

A spokesman for newly appointed Local Government Minister Wendy Tuckerman said the government wasn’t responsible for the rate peg decision.

“The Minister for Local Government has no say on how IPART makes its determination on Special Rate Variation requests,” he said.

“However, the residents may submit public comments regarding the application on IPART’s website.”

BID FOR DECADE LONG RATE HIKE A KICK TO COASTIES GUTS

Jake McCallum

NewsLocal State Political Reporter – Opinion

Central Coast Council’s bid to continue to slug ratepayers with an eye-watering 15 per cent rate increase — for another seven years — is a slap in the face to residents already doing it tough.

Council’s administrator Rik Hart this week claimed that an application to the Independent Pricing and Regulatory Tribunal to extend the Special Variation for a total of ten years was maintaining the “status quo”.

But maintaining the status quo for council’s plan to repair is drastically failed budget, could send its own residents’ household finances into the red.

In July 2021, unemployment rates across the coast hit 6.1 per cent.

In July last year, when IPART approved a three-year rate increase, Gosford locals experienced rate rises of up to 42 per cent, while the unemployment rate across the coast hit 6.1 per cent.

At the same time, Wyong residents are currently ranked 13th in the state for the highest number of people on JobSeeker with a shocking 9.2 per cent of the working population requiring government assistance.

A total of 8.8 per cent of the residents in the electorate of Gosford currently rely on JobSeeker for income, while The Entrance has seen 7.8 per cent rely on subsidies.

In the electorate of Terrigal, 4.6 per cent of the population are on JobSeeker.

You have to wonder if Mr Hart assessed these unemployment rates and JobSeeker statistics before claiming residents wouldn’t see a “difference”.

There is an immense difference between a 15 per cent rate hike finishing in two years in comparison to nine — particularly for households already doing it tough.

Households already doing it tough could be impacted. Picture: iStock.

Council’s bid for a decade-long rate increase — despite it’s own 2021 submission claiming it would pay back the debt in seven years — isn’t maintaining the ‘status quo’, it is punishing residents where it hurts.

Meanwhile, concerns over ratepayers being slugged with sky-high bills for a decade have been rejected with claims of “misinformation” by Mr Hart.

Another slap in the face to households facing 10 years of uncertainty, not knowing how they will afford their bills.

Rather than diverting blame from the government, Local Government Minister Wendy Tuckerman should step in to come up with a solution that doesn’t punish residents for an additional seven years.

Mr Hart was installed as administrator last year, after previous administrator Dick Persson AM revealed Central Coast Council blew out its budget with a $565 million debt, which included unlawfully spending $200 million worth of restricted funds.

Despite the shocking amount of debt being reduced by more than $200 million in the past year alone, council’s plan is to charge residents some of the highest rate percentages in the country for another nine years.

Slugging ratepayers with a rate hike of 15 per cent for a decade should not be the ‘status quo’.