City of Greater Shepparton Mayor Shane Sali says council will likely need to raise rates next year following two years of rate freezes.
At last Tuesday’s meeting, councillors acknowledged council’s October budget update, which is $18 million in the red following impacts from coronavirus, inflation and clean-up from last month’s floods.
Cr Sali said he believed rates would need to rise next year, with the exact amount dependent on the cap the Victorian Government put in place.
“I can't speak for all councils and predetermine an outcome but I think it'll be very hard for us to maintain another zero per cent rate increase just on the sheer increase of expenses,” Cr Sali said.
“I don't think it would be a wise financial decision.
“We've also got to be mindful that whatever we do has an impact on (the) community whether it's positive or negative.”
Cr Sali said he would likely support passing on the maximum rate increase, which will be set by the Victorian Government early next year.
Rate re-evaluations are also taking place towards the end of 2022 following the floods, with many properties to receive relief in the form of lower rate repayments.
Council’s big revenue generators — services such as Aquamoves, Riverside Eastbank and WestSide among them — have been closed for the better part of two years.
While council has received flood assistance from the Victorian and Federal governments, both by way of direct cash injections and from other government bodies providing services the council previously paid for, the impact of the floods on the bottom line was still to be determined.
At Tuesday’s council meeting, Cr Seema Abdullah said the council was under “many financial pressures”, with the flood recovery ongoing.
“Floods are currently affecting us and will affect us into the future,” she said.
“Insurance costs are going up, inflation is pushing a lot of costs up.”
Cr Geoff Dobson said it was “a perfect storm” that had affected the budget.
The budget will also be impacted by the arrival of later rate instalments due to extensions allowed.
Cr Fern Summer said she was “concerned” by the council’s budget position and said the organisation had to “tighten the purse strings” over coming months and into next year.
She said she didn’t accept a lack of increase to rates as the reason behind council’s poor budget position.
“We must apply oversight and must encourage some hard operational decisions, (or) else we run the risk of long-term financial insecurity,” she said.