Critics of the proposed Special Rate Variation have mostly pushed two arguments: (1) we can't afford another hike in rates and (2) Council's costs (especially wages) are too high.
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Let's see what light can be shed on these claims, if we analyse the latest official data comparing performance of all NSW Councils in 2014/15. The data are from the Office of Local Government website.
Let's look first at costs. If you compare Bellingen Council to the 45 other Councils in its "Large Rural" Group, you find that on most of the available measures, Bellingen's costs were below the median for this group.
This was true for total per capita recurrent expenditure from continuing operations (minus recurrent expenses associated with water and sewerage); and also for the same measure after further deductions of recurrent environmental expenditures (which are understood to be mostly for waste disposal), well as those for roads and bridges.
There is no specific information on wage costs. However, on the measure: local population per full-time equivalent council employee, Bellingen is one of the better performers.
Bellingen did have very high environmental expenditure per capita, but balanced this by recycling a higher percentage of waste than most other Large Rural Councils.
Per capita expenditure on Public Order, Safety and Health was high, as was recurrent expenditure on Roads and Bridges (especially when measured "per kilometre of road", rather than per capita)
So, compared to the general run of councils in the Large Rural group, it appears that Bellingen was not doing too badly on costs in 2014/15.
It’s a different story when you turn to revenue from rates. First, average personal taxable income in Bellingen Shire, and the average per capita value of rateable land, were both well down towards the bottom of the distribution.
At the same time, the average residential rate, and the ratio of total rate revenue to total land value in the Shire, were both way above the median value.
In other words, in 2014/15 Bellingen residents had one of the highest rate burdens (relative to income and wealth) of all Large Rural councils in NSW.
It’s no surprise therefore that we howl whenever Council proposes yet another rate hike!
I put it to Council that, if we are already paying high rates relative to taxable capacity, then it just isn't good enough that Council's recurrent costs are merely "a bit better than average".
There are a few councils in the Large Rural group, whose per capita costs were "best in class" and whose circumstances were probably not too different to Bellngen's.
Council needs seriously to benchmark its costs and service delivery levels against those councils, and come up with significant savings.
The amounts at stake could be large.
For example, I estimate that, if Bellingen's per capita expenses on continuing operations (other than water, sewerage and environmental services, roads and bridges) had been as low as in Inverell or Tenterfield, it would have saved $2 million or $2.6 million respectively in 2014/15. The starkest comparison is even closer to home: if Bellingen's costs in 2014/15 had been the same as in Nambucca, I estimate that it would have saved $4.7 million. Potential savings such as these dwarf the amounts to be raised by the proposed Special Rate Variation
Its about time Councillors showed some spine and demanded real action from management on costs, rather than supinely acquiescing in a premature rush for yet another Special Rate Variation.
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