Rate caps, service gaps, ageing infrastructure and state/federal government cost shifting has impacted delivery of basic core service responsibilities in Macedon Ranges.
Macedon Ranges Shire Council has flagged concerns in a detailed submission to the Victorian Legislative Council’s Economy and Infrastructure Committee that will investigate local government funding and service delivery in Victoria.
Increasing expectations of service delivery, increased cost bases, cost-shifting, workforce challenges, emergency management impacts and revenue limitations were among the issues highlighted.
MRSC CEO Bernie O’Sullivan and council’s director of corporate, Adele Drago-Stevens, joined several councils in speaking to their submissions last Wednesday, seeking change to improve sustainability of the local government sector.
“Sustainability of the sector is under challenge and if we don’t do anything we will see more regional and rural shires report deficits,” Mr O’Sullivan told the panel.
Rate capping was a hot topic for shires submitting to the inquiry, many pointing to significant differences between metropolitan and regional/rural councils, particularly around means of revenue raising.
One suggestion from MRSC was a review of the inputs for the rate capping mechanism including consideration of a ‘Local Government Cost Index’.
“I think it’s important to think about it as a revenue system – not rates – and it’s effectively broken right now,” Hepburn CEO Bradley Thomas said.
“The capacity for local government to access alternative revenue is limited.
“The financial challenges are here and now, and the majority of councils have looked at cutting services to keep up.”
Natural disasters was another topic raised that have seen regional shires impacted more than their metropolitan counterparts.
Both Hepburn and Macedon Ranges aired concerns about the clean-up costs of chaotic storms, including roads, and the financial burden impact.
Ms Stevens pointed out MRSC had had to direct $12 million to roads in its 2024-25 budget, due to severe weather damage, when it “should be spending $5M”.
“It has an impact on the rest of the budget,” she said.
Another big issue flagged was the type of state and federal grant funding available. Councils aired concern that typically grants were directed at “new and shiny” infrastructure projects rather than renewal of existing assets.
“It compounds the issue because then we have a growing number of assets to maintain,” Ms Stevens said.
The cost of maintaining swimming pools was just one example of ageing infrastructure that was costly to maintain, replace and upgrade.
Mr O’Sullivan suggested there were opportunities to look at sharing arrangements for funding between local and state governments. An example of the shared funding is library services, which the shire currently funds 75 per cent, an increase from previous 50/50 funding models.
He also flagged the need for infrastructure funding support with planned population growth for regional areas.
Macedon Ranges Shire Council’s submission will be considered the review of local government funding and service delivery in Victoria.
