NOTICE | Funding, Costs and Expectation Gap for Local Government | The mail


Councils in Victoria face the ongoing challenge of balancing community priorities and expectations as well as their budgets as multiple factors begin to impact their financial situation. The Government of Victoria’s rate cap, rising operating and maintenance costs and the cost of pandemic recovery for communities all contribute to the difficult fiscal environment that councils and communities face. By maintaining a universal rate cap – set at 1.75% for 2022/23 – the Victorian government is not allowing individual councils to meet their funding needs. The 1.75% increase is likely to capture only about 40% of the upward cost pressures over the next fiscal year, as the Municipal Association of Victoria projects council staff wage pressures of about 2.5 %, while materials and services are expected to grow 4-5%. cent, because these are the trends that are manifesting themselves in the economy at large. Cost pressures are especially strong for councils that operate major community and recreation facilities, especially when many of those outdoor pool facilities in municipalities across the state are 50 years old — and often older. Despite these ongoing financial constraints, community expectations of O&M councils are expected to continue to rise. In completing deliberative engagements with our 79 diverse communities across the state, MAV has not heard of a single community asking its council to do less. The expectation gap has played out in the Campaspe Shire in recent weeks. There has been a lot of community and media interest in the status of seven council-run swimming pools within the municipality and, importantly, the council is in the process of consulting with its communities at this time. In order for a council to make good, but difficult decisions, it is important that the community is informed and can participate in these stimulating discussions. Appropriate consultation means understanding how the facilities are used, what the cost is to the council and, in particular, what the investment costs are expected to be in the near future. Each council uses the money collected through tariffs from you, the community, to run facilities such as swimming pools. It is only fair that council fulfills its obligations to spend these public funds well, including giving due consideration to costs, and allowing the community to have a voice in helping council make decisions. Municipalities across the state are now having difficult conversations with their communities about the level of services they can provide in this constrained environment. Funding for a number of local government infrastructure and services will be a hot topic ahead of state and federal elections later this year. One of the main areas of responsibility of councils, particularly regional and rural councils, is that of roads and transport infrastructure. That’s why MAV has been busy hosting virtual workshops with council officers across the state to help us develop a focused transportation defense strategy. Key advocacy areas include the financial sustainability of current road funding models, ensuring safer communities around roads, and freight. Hearing from specific communities about their needs, previous campaigns, and priorities, we live up to the campaign title “Locals Know What Locals Need.” When this strategy is finalized and rolled out, it will highlight a key function of MAV, collaboration and pooling of resources across councils, ensuring that the local government sector has the strongest voice possible. Leading and facilitating campaigns that benefit the local government sector and highlighting the important – but difficult – discussions that councils need to have with their communities are an important part of the work that MAV will do this year in the run-up to national elections and federal. .