LOCAL Government NSW (LGNSW), the peak body for NSW councils, says the newly elected NSW Government has kicked off its first term in the worst possible way by sending NSW council budgets into meltdown, forcing them to shed jobs, close services and scrap infrastructure plans.

The Emergency Services Levy (ESL), which funds agencies such as the Rural Fire Service, is mostly paid for as part of insurance premiums, but the State Government and councils contribute 14.7 percent and 11.7 percent respectively.

Advertise with News of The Area today.
It’s worth it for your business.
Message us.
Phone us – (02) 4981 8882.
Email us – media@newsofthearea.com.au

The Government has covered annual increases in the levy for councils since 2019 but the incoming Government has said the arrangement is ‘ad hoc’ and not budgeted for, and discontinuing it will save NSW up to $77 million this financial year.

However, LGNSW said the loss of the subsidy would be catastrophic for many councils, and could see some become insolvent.

It said that, for some councils, the unexpected cost hit would all but wipe out any IPART-approved rate rise, shredding budgets already under massive pressure from the combined impact of the pandemic, extreme weather events, high inflation and wage increases.

“The ESL is an absolutely blatant cost shift by the State Government,” LGNSW President Cr Darriea Turley AM said.

“To make things worse, the ESL has seen stratospheric increases year-on-year to make up for the Government’s unfunded workers’ compensation liability for emergency services workers struck down by a range of cancers.

“Now it appears councils are being asked to fund massive rises in emergency services budgets, including a 73 percent increase in the budget allocation to the State Emergency Services (SES),” Cr Turley said.

LGNSW is calling on the Government to restore the subsidy for 2023 and develop a fairer, more transparent and financially sustainable method of funding the critically important emergency services that benefits everyone.

City of Coffs Harbour General Manager Natalia Cowley said, “The City of Coffs Harbour, along with the other 127 councils in NSW, is extremely disappointed at the State Government’s decision to suddenly remove the Emergency Services Levy subsidy.

“While we have absolutely no argument with emergency personnel and the magnificent work they do, we do have an issue with further significant cost-shifting by the State Government.”

Ms Cowley said a major point of concern, and the real crisis point of the decision, is that it comes after councils have prepared their draft budgets for the coming financial year and gives them no opportunity to forward plan and manage an entirely unexpected increase.

She said the subsidy removal will result in a further strain on current revenue sources of the City of Coffs Harbour as it faces an overall ESL bill of more than $2,008,000, an increase of $708,270 from the 22/23 financial year.

Ms Cowley said this effectively wipes out 79 percent of the City’s IPART-approved rate increase for the coming financial year, which is bound to have an adverse impact on the level of community services provided.

“We are calling on the Government to restore the subsidy for 2023.”

By Andrew VIVIAN