Local Government Association of Queensland (LGAQ) President Margaret de Wit today urged Queensland councils to factor in how a potential 3.3 per cent rise in council costs would hit them when they set their rates for the 2013-14 financial year.
The cost hikes were revealed through the LGAQ-researched Council Cost Index, which factors in elements like road and bridge building that are unique to local government and aren’t measured by conventional inflation measures like the Consumer Price Index (CPI).
Ms de Wit said the big problem for councils was that they either had to increase rates or find a way to provide the services expected of them with less money.
“State and Federal governments are devolving more functions to councils but the councils can’t keep on absorbing the costs of doing that,” she said.
“The challenge is providing for the increased expectations of communities which cover the increased cost, and that cost has to be covered somehow.
“I don’t see how any council in Queensland can absorb the sort of cost increases that we are experiencing.”
She said the Queensland Treasury Corporation told councils several years ago to be very careful about limiting rate rises to CPI because the general inflation rate wouldn’t necessarily reflect the true cost of delivering services.
The 2011 and 2013 floods have also had a big impact on how councils deal with their costs because Federal Government compensation hasn’t met the amounts councils require for repairing damaged and destroyed roads and infrastructure.
Ms de Wit said “it’s worse than ever up here” because no matter how much the Federal Government compensated councils for the flood, “we’re still out of pocket” because it has never met the full cost.
Last week the State Government said it was disappointed the Federal Government had only announced half the amount of money estimated to repair flood damaged infrastructure.
Community Recovery and Resilience Minister David Crisafulli said the State asked the Federal Government to match the $140 million needed to recover the flood-affected areas but it had announced only $57 million.
Mr Crisafulli said $40 million of that would apply only to council assets, which he described as “most disappointing”.
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