Northern beaches households face maximum council rate rise as inflation bites

Rising costs and inflation, including $1m to build 1km of footpath, are behind a proposed council rate rise. See what the average household on the northern beaches may have pay next year.

An artist's impression of the new Warriewood Valley Community Centre. A proposed rate rise would help pay for its construction. Picture: Supplied

Northern beaches’ homeowners could be hit with an average $79 a year hike in their council rates.

The 4.9 per cent increase, which will take the annual rates to about $1700, is proposed in the Northern Beaches Council’s draft budget for the 2024/25 financial year.

And ratepayers are also set to be hit with a $31 rise — to $586 — in the charge to collect household garbage, waste and recycling bins.

Under the NSW Government “rate peg” system, managed by IPART (independent Pricing and Regulatory Tribunal) the council can lift rates by a maximum of 4.9 per cent next financial year.

If the 4.9pc rate rise was adopted, it would provide $197m in income to the council.

Flash flooding after drains overflowed on Pittwater Rd at Narrabeen in February, 2023. The council wants to set aside more than $10m in its next budget on “priority” stormwater works to reduce flooding and pollution. Picture: SES Warringah/Pittwater

Draft budget papers, presented to Tuesday night’s council meeting as part of a motion to put them out for public comment, stated that the rate rise was needed to counter the affects of inflation on council costs.

The council was told it would cost, for example, $1 million to build one kilometre of footpath.

But several councillors argued at the meeting that significant cost saving measures should be adopted rather than a maximum rise in rates.

Inflation meant that the current revenue from rates was not keeping up with the rising costs of “labour, materials, contracts and construction”, a staff report to the council stated.

The council also needs the money to help fund its $101 million capital works program, which includes $16.7m towards building the new Warriewood Valley Community Centre and more than $16m to improve local roads.

Close to $6m would be spent on cycleways. Picture: Marie Nirme

About $10m would also be set aside, if the budget was ratified later this year, to “priority” stormwater works to reduce flooding and pollution.

Close to $6m would be spent on cycleways, including a “cyclist bridge at Queenscliff”; $5.2m on 5km of new and improved footpaths and; $3.3m on continuing coastal protection works at Collaroy and Narrabeen.

The council wants to budget for $3.3m to continue coastal protection works at Collaroy and Narrabeen. Picture: Julian Andrews

Independent councillor Vincent De Luca asked staff why it was costing $1 million per kilometres to build footpaths.

Your Northern Beaches independent Team councillor Jose Menano-Pires described it as a “spend and tax” budget.

“This is a budget that spends a lot of money we don’t have and, later on, we’re going to tax out residents to recover the costs.”

Liberal councillor Dave Walton said council’s expenditure was “out of control”.

Cr Walton said employee costs, for example, had jumped by 8.8 per cent. The council has six executives who are paid more than the Premier of NSW, who is paid $416,000.

“Now we are going to ask the community to pay, above inflation, for our operational expenditure that’s out of control”.

The documents stated that a total of $526m in council expenditure had been identified.

In a draft Asset management Plan, the council stated that it needed $15.1m per year in “additional investment” to “maintain and renew existing assets “ and needed $10.4m to “uplift service levels” and provide “high priority assets required by the community”.

Potholes on busy Beacon Hill Rd, Beacon Hill. The council wants to set aside $16.4m for local road improvements. Picture John Grainger

The council’s draft Long Term Financial Plan also stated that income levels were no longer sufficient to fund operating expenses; invest in the renewal of infrastructure and provide working capital to “manage unexpected events”.

“(This is) a scenario which is not sustainable and without intervention will continue to reduce services to the community, ” according to a staff report to the council.

“Like many councils in NSW, (Northern Beaches) Council is facing growing pressure to its financial sustainability as increases in income, under the NSW rate peg system, have not reflected the rising costs of labour, materials, contracts, and construction, with Sydney’s inflation over the three years to 30 June, 2023, being more than double the increase in rates income.”

The council voted to put the draft budget on public exhibition for 28 days before voting on the final version of the budget in June.