Broken Hill City Council (BHHC) will be required to pay $801,000 towards the Emergency Services Levy (ESL) this financial year – an increase of $140,000 and 21 per cent of the IPART (Independent Pricing and Regulatory Tribunal) rate peg increase. It follows the independent body’s increase to the ESL which will see all 128 councils in NSW having to collectively contribute towards an extra $77 million to fund the state’s emergency services in 2023/24.
“Council budgeted about $660,000. That extra $140,000 won’t be able to be spent on services such as cleaning weeds, improving ovals, or other amenities, in Broken Hill. It’s a big hit to the community and it will really set back the council many years”, Mayor Tom Kennedy told the Barrier Truth.
Local Government NSW (LGNSW) has labelled the increase of the ESL as “catastrophic” and “a blatant cost shift by the state government”. The increase comes after the newly elected state government, in eyeing budget savings, has moved to stop picking up the tab for the annual hike, therefore putting it on councils to cover the costs.
“It’s really up to the state government to get their budgets together and fund the emergency services adequately so they continue to supply the good services they do all over the state. I think there’s much better ways to fund the state emergency services beyond the levy that is put on to local councils or insurance policyholders,” Mr Kennedy said while reiterating the emergency service’s importance.
Barwon MP, Roy Butler, said “there needs to be some change in the rules relating to regional councils”, with the increased levy and the removal of the subsidy only one part of the problem – along with the depreciation of assets and bearing the costs associated with the “red fleet” – for regional councils who were already struggling financially in the years before being hit by unforeseen natural disasters.
“Councils in Barwon have a much smaller rate base, but they serve huge areas and have fewer opportunities to collect revenue than big city councils. Councils don’t have control over those emergency services assets but have to bear the cost burden,” Mr Butler told us.
“Councils need to be allowed to write off the depreciation or to be subsidised for those costs. The rules that are designed for metropolitan councils don’t work with councils in the bush. We’ve already been discussing this with the Minister for Local Government.”
Mr Kennedy assured us that BHCC wouldn’t pass on the increase onto ratepayers, signifying council is bound by rate pegging – currently at 2.3 per cent – and that he “would never, as a Councillor or Mayor, apply beyond that rate pegging”.
“Council should live within its means and budget within its means to provide the services communities expect. But what makes it very difficult is when the state government imposes charges on council that are beyond that rate peg. The ESL should never go up beyond what rate pegging is.”
Darriea Turley, President of LGNSW, conceded that “it’s a really complicated system”, but reiterated that councils have always paid an ESL, which became further complicated when the previous government moved the State Emergency Services (SES) into the equation – the cost of their service delivery increasing over 70 per cent.
“We certainly will always support our emergency services. But we just think that it’s a cost that local government cannot bear, especially with all the emergencies that we’ve been through over the last three years, including the pandemic,” she told us.
Ms Turley confirmed that Treasurer Daniel Mookey had agreed to meet with LGNSW and welcomed the decision to discuss the increase to the ESL.