Rates in North Sydney are set to increase 52.66% over three years, following approval on 2 June by regulator IPART for a permanent special variation (SV).
If approved by council at its 29 June meeting, rates will increase from July this year, with minimum residential rates increasing by $473 to $1,216 by 2028. The increase will generate an extra $34.2 million in income over three years, which council said it would use to address an infrastructure backlog and repay loans.
IPART said in its report that council had demonstrated financial need, with operating expenses expected to exceed revenue without a special variation, which would leave council with an operating performance ratio of -2.5% over five years.
“The council provided evidence that its community was aware of the need for and extent of the proposed special variation,” IPART said in its report. “It also established that the impact of the proposed rate increase on affected ratepayers was reasonable.”
The rates regulator conducted its own community consultation on the proposed SV, reporting that 86% (893 of 1,047 responses) opposed the size of the increase, with 84% saying the council had not been effectively managing its budget. Around 85% of 998 respondents ‘disagreed’ or ‘strongly disagreed’ that council had considered community feedback in its decision making.
Mayor Zoë Baker said in a statement the ‘approval is an important step towards restoring council’s long-term financial sustainability, and ensuring we can continue to provide the infrastructure, services and public spaces our community relies upon.
“The primary focus of the SV is infrastructure renewal and reducing asset backlog, while also supporting improved systems, governance and service delivery into the future.”
A spokesperson added that the ‘comprehensive two-phase community engagement program demonstrated recognition from many in the community that additional investment would be required to support North Sydney’s long-term sustainability.’
Liberal councillors Jessica Keen and Efi Carr oppose the rate rise. Cr Keen said IPART’s decision was ‘very disappointing.’ “Because we are all very conscious of cost of living at the moment, all the time. And I think to go and have (a 50% rise), it’s just too much.”
Cr Keen told NL she was on the record as advocating for council to review its commercial assets portfolio and consider selling assets instead of a rate rise. “They should prioritise (that) at this point in time.”
IPART suggested in its report that council may want to reduce its ordinary rates in future once it had reviewed its property portfolio.
Liberal North Shore MP Felicity Wilson also objected to the rise, saying council needed to ‘tighten its belts – just like the people they represent.’
Cr Keen encouraged residents to attend the 29 June meeting to voice their opinion, saying that as the public forum had been abolished, there were now no limits on speaker numbers.
In a release, council said its Productivity and Improvement Plan had identified savings and new revenue, reducing the need for a larger rate increase, while reinforcing council’s commitment to careful financial management and transparency.
“Council understands the impact any increase in household costs can have on residents and businesses,” Mayor Baker said.
“We remain committed to responsible governance, ongoing productivity improvement and ensuring these funds are directed towards the long-term sustainability, liveability and resilience of North Sydney.”
Council will vote on the updated Long-Term Financial Plan and Delivery Program to reflect IPART’s determination, and proceed with implementing its financial sustainability pathway if approved at the 29 June meeting.
