Wimmera councils could have to cap rates

WIMMERA councils could be forced to cap municipal rates under a new Labor plan.

WIMMERA councils could be forced to cap municipal rates under a new Labor plan.

WIMMERA councils could be forced to cap municipal rates under a new Labor plan.

The party has unveiled plans to cap council rates at the consumer price index if it wins the state election.

Under the plan, councils would have to justify any further increases to the independent Essential Services Commission.

Labor leader Daniel Andrews said councils that hiked rates would be accountable for how they spent the revenue.

"Councils will be forced to limit rate rises and detail where every dollar will be spent, because ratepayers deserve a fair go," he said.

But Yarriambiack Mayor Andrew McLean said rate capping was not the solution.

"It is simply an ill-conceived policy that very much undermines local democracy," he said.

Cr McLean said council experienced rate restrictions in the 1990s.

"It initially sounded great, but it soon became evident that council service provision declined and infrastructure development was reduced significantly," he said.

He said rate capping would have a detrimental effect on the shire.

"Some services unfortunately would be required to be reduced and sadly some services would no longer be able to be provided," he said.

Hindmarsh Mayor Rob Gersch said the issue was discussed at a Municipal Association of Victoria rural and regional forum yesterday.

"It was a unanimous vote against rate capping," he said.

"The community would have to tell us what services they wanted reduced because we would not be able to maintain them all."

Cr Gersch said there were also issues with capping rates at the consumer index price.

"Our local government CPI is higher than the normal CPI so if they want to cap the rates, the question is what index do we go by," he said.

The Victorian Farmers Federation has supported Labor's plan to cap rates.

Federation president Peter Tuohey said councils had to rein in their spending.

"This is a great first step, given farmers have faced municipal rate rises of 7.5 to 13 per cent in recent years," he said.

"The VFF has long been calling for fairer rural rating, lobbying hard in the past decade to ensure that farmers aren't forced to pay an ever greater share of council rates."

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