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Mon. May 20th, 2024

A number of councils in our area are applying to IPART for an SRV that will increase your rates… but what is IPART, what do they do, and how can you have your say?

IPART stands for Independent Pricing and Regulatory Tribunal. It’s a NSW Government body that investigates and gives advice on prices and other issues to make sure you are getting a fair price for the services you need, like water, public transport, energy, and all the fees of local government like your rates. The tribunal is made up of three people who are appointed permanently to the job by the Premier.

Every year IPART decides a ‘rate peg‘ for each council in NSW which sets the maximum amount councils can increase the revenue they collect from rates. Councils must seek IPART approval to increase their rates revenue by more than the rate peg. To do this they apply to IPART for a special variation or SV – most commonly referred to by councils as a special rate variation or SRV. Variations can be permanent or temporary, and can be for a single year of phased in over multiple years.

The reasons councils ask for variations is many and varied. A common reason being given this round is because of inflation: just as your cost of living has gone up, so has the expenses and overheads of local councils. Others have significant debts or budget shortfalls that need to be rectified. Some are seeking to do special projects that require additional funding. And for some councils, it’s a bit of all of the above: for example, Armidale Regional Council, is seeking a special variation to fix a shortfall in regular funding but also to do a number of new projects like the controversial Rail Trail and creating a regional brand. And for others, it’s really just administrative, as is the case for Liverpool Plains Shire Council which is seeking a special variation to make the approved temporary increase of the last two years permanent.

New England region councils seeking a special variation to rates for 2023/24 and beyond

CouncilCumulative increaseReason given
Armidale Regional Council58.8%Budget shortfall, new projects
Liverpool Plains Shire Council18.8%Making previous temporary variation permanent
Tenterfield Shire Council104.49%Budget shortfall, significant debt
Walcha Council57.74%Budget shortfall

What’s the process?

Council can’t just increase your rates because they want to, and they can’t apply to IPART to increase your rates without asking the community for their opinion first.

Each local council that wants to seek an SRV must have detailed planning documents that indicate why they need the extra money and what they are intending to use it for. Then, they must thoroughly consult the community, explain to the ratepayers why they want to increase the rates, and seek their approval to do so. If you live in one of the areas seeking an SRV, you should have seen something about it by now.

Then, once the consultation is done and the detailed plans are approved by a vote of elected councillors, the council can submit their application for an SRV to IPART. Applications to IPART were due last week, and they will all be published on the IPART website this Friday, February 10.

IPART carefully assesses council special variation applications against five criteria set by the Office of Local Government. The five criteria are, broadly:

  • a need for the special variation is clearly demonstrated in the council’s integrated planning and reporting (IP&R) documents
  • evidence that the community is aware of the need for and extent of the rate rise
  • the impact on affected ratepayers must be reasonable
  • the council has publicly exhibited, approved and adopted the council’s integrated planning and reporting documents
  • a history of well-documented council productivity improvements and cost containment strategies.

The IPART process includes plenty of opportunity for residents to comment on the proposed special variation. You can make your submissions, addressing the above five criteria, until March 3, 2022.

IPART will assess each application on its merits and figure out whether or not the requested increase is reasonable. In doing so, IPART may consider:

  • size of the council
  • resources of a council
  • size (both actual $ and %) of increase requested
  • current rate levels and previous rate rises
  • purpose of the special variation
  • compliance with guidelines
  • compliance with the conditions of any previous special variations
  • any other matter considered relevant in the assessment of a special variation application.

Once IPART has made its decision, they will publish on its website a statement of reasons for its decision to approve, either in full or in part, or not approve an application. Decision are scheduled to made public on May 9. IPART decisions are final.

More information about the process is available in IPART’s special variation information paper (here). There is also more information available in the Office of Local Government’s guide (here).

There’s also this video made by respected local government expert Professor Joseph Drew for Walcha Council explaining the process.

Making a submission

Submissions can be lodged on the IPART website from when council applications are published on 10 February up until 3 March.

You can subscribe to receive updates from IPART here. Once the webpage has loaded, select local government. Subscribing will make sure you are notified about when the submission webform is live and opportunities for consultation.

We asked IPART to give us some tips on making a submission, and they said their number one tip for residents is to provide comments related to one or more of the five Office of Local Government criteria (noted above) that IPART uses to assess a council’s application for a special variation.

IPART Chair Carmel Donnelly said they welcome input from all residents.

“If you have something to say about a council’s application for a special variation IPART is keen to hear from you.”

“Residents may include whatever information they feel will assist IPART [in their submissions].”

“We do encourage residents to wait until council formally lodges a special variation application with IPART, and we upload the council’s supporting materials on our website. Residents may find that the materials respond to some of their concerns or raise new matters on which they would like to make a submission,” Ms Donnelly said.

As one of the biggest concerns that has been raised with the Armidale Regional Council’s proposed SRV is the way the consultation itself has been conducted, we asked if people can comment on that. The answer is a clear yes.

“Councils are required to consult with their communities about proposals for increasing rates.”

“It is important to hear from residents if there are concerns about the consultation process,” IPART Chair Carmel Donnelly said.

It is best to make your submission using the webform on the IPART website. While it isn’t compulsory and there are other ways you can send in your submission, the form guides residents to make comments that directly relate to the criteria IPART uses to make its decisions. There are no word limits on the submissions.

IPART’s email for the special variation process is localgovernment@ipart.nsw.gov.au

And for those who prefer snail mail, IPART’s mailing address is:
Local Government SV Team
IPART
PO BOX K35
Haymarket Post Shop, NSW 1240

But remember, don’t put in your submission until after the documents are on the website on Friday, and you have a chance to look at them, because something might have changed since the last time you looked at the proposal.


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