State charges, employee costs play role in Wanneroo rates increase

The City of Wanneroo has budgeted for an extra $4.4m in rate income due to a 1 per cent rate increase, expected growth in the number of rateable properties and removal of its one-off Covid-19 concession. File picture

WANNEROO councillors have blamed state government charges for their decision to increase rates by 1 per cent but a closer look at the Budget shows reduced income from operating grants and higher employee costs also play a role.

Last year after facing significant backlash the City of Wanneroo agreed to a one-off Covid-19 rates concession worth about $2.7m resulting in 99.25 per cent of residential and 95 per cent of commercial-industrial properties paying the same or lower rates than in 2019-20.

When moving a motion to pass this year’s Budget Mayor Tracey Roberts said much like family budgets local governments faced increased fees and charges as a result of recent state government announcements.

Mrs Roberts, who is understood to be Labor’s favoured candidate to run for Pearce at the next federal election, said based on the city’s 25,000 streetlights, the state government’s 3.03 per cent increase in electricity charges in 2021 would increase costs to more than $6.3 million.

She also said a four per cent increase in the state government’s emergency services levy would add $115,000 to the city’s costs.

The City of Wanneroo Budget notes that the city received funding of $8.2m from the Commonwealth federal assistance grants commission in June last year.

Prior to the pandemic it would have received that funding in the first quarter of the new financial year.

In 2021-22 the city has budgeted for employee costs of $77.1m (up $1.9m or 2.5 per cent from the previous financial year).

The officer’s report on the Budget said the city – in consideration of the improving current economic environment – would start on full recruitment of staff reflecting an increase of $1.1m, resume training which had been limited last year adding to the budget by $321,000 and ensuring all essential operational staff positions were covered for leave adding a further $380,000.

South ward councillor Domenic Zappa, who seconded the motion to pass the 2021-22 Budget, said Australia and particularly WA had moved out of economic recession much faster than anticipated and it was important to focus on the long-term financial sustainability of the city.

Cr Zappa said according to an Australasian local government performance excellence survey the city’s number of employees to residents at 3.6 employees for every 1000 residents was below other WA local governments.

But Cr Zappa said the city’s financial reserves would be used once again to support key capital projects to meet the demand of a growth council especially in the northern part of the city.

South ward councillors Hugh Nguyen and Vinh Nguyen unsuccessfully argued against the 1 per cent increase citing a Digital Finance Analytics household survey showing a high amount of mortgage stress in 20 Wanneroo suburbs and anecdotal information supplied to them by ratepayers who were struggling financially.

North Coast ward councillor Chris Baker said the council could not put off a rate increase indefinitely.

“If we put off a 1 per cent rate increase this year it may require us to have a 4 per cent rate increase next year,’’ he said.

Speaking for the Budget proposal councillor Paul Miles said increased state government charges relating to motor vehicles would also affect the city as it had multiple vehicles including for rangers and waste services.

Central ward councillor Dot Newton said if people were struggling with mortgages they needed to talk to their banks, which were still making big profits but the council could not manage financially without levying rates.

Central ward councillor Jacqueline Huntley said she disagreed with councillors Hugh Nguyen and Vinh Nguyen and said the council’s rate bill was modest for what was provided.

In his argument Cr Vinh Nguyen had said some ratepayers were facing the choice of putting food on the table or paying rates.

Cr Huntley said she “didn’t see Cr Nguyen not get on that aeroplane to Canberra in order to put food into the mouths of his people”.

In 2021-22 the city has budgeted for employee costs of $77.1m (up $1.9m or 2.5 per cent from the previous financial year).

Later when Cr Nguyen wanted to ask about the relevance of her comments Mrs Roberts said it was not appropriate to ask questions of each other at any council meeting and asked him to contact Cr Huntley directly about it.

South ward councillor Brett Treby said the city’s 1 per cent increase equated to about $1.4m.

A spokesman for Premier and Treasurer Mark McGowan said local governments were required to pay an emergency service levy (ESL) for the properties they own.

“However, the levy is only calculated on improved properties and the Department of Fire and Emergency Services directly invoices local governments for the ESL payable on these properties,’’ he said.

For other properties the freeze in ESL rates implemented in 2020-21 as part of Covid relief measures resulted in decreased ESL average residential charges for the vast majority of owners.

“While the levy assessed on each property owned by the City of Wanneroo in 2021-22 will in general increase compared to 2020-21, the amount assessed per property will in most cases be lower compared with two years ago in 2019-20.”

The spokesman said tariffs charged to a local government authority (LGA) were dependent on their annual electricity consumption, based on megawatt hours consumed.

“Local governments have a number of streetlight-specific tariffs available to them to help find a solution that best suits their needs.

“To help reduce costs and energy consumption, Synergy also has a dedicated account manager that engages with WALGA and LGAs.

“This includes educational information sessions and direct liaison about energy cost and consumption, management strategies and new energy solutions.”

On May 31 the state government said motor vehicle related charges would rise by a total of 3 per cent.

But local governments have a 100 per cent exemption from vehicle licence fee and licence fee duty for vehicles with a gross loaded mass (GVM) of 4.5 tonne or less while vehicles with a GVM of more than 4.4 tonne have an exemption from vehicle licence duty only.

The spokesman confirmed the increases to vehicle licence fees from July 1 would not affect LGAs.

“(But) local government authorities, like all registered vehicle owners, are required to pay motor injury insurance for any of their registered vehicles.

“This includes both compulsory third-party insurance and the catastrophic injury support scheme, to provide vital support for Western Australians who are catastrophically injured in road accidents.”

On May 31 the Premier and Treasurer Mark McGowan said compared to pre-Covid-19 levels, household charges would be 0.6 per cent higher in 2021-22 given the continued benefit of passing on lower gross rental values (GRVs) and the freeze on household charges.

“Over the past three years, the McGowan Government has spent $1.9 billion to keep household fees and charges low and provide relief through the Covid-19 pandemic,’’ he said.

Prior to the March election the state Treasury said it expected a $3.1b surplus due to higher iron prices and increased activity in the residential property market.

But recently the Opposition has estimated the McGowan Government will have a surplus of about $5b.