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A Culture of Spending Part 2 - No Rate Capping for us, thankyou.

As you may know, the current State ALP government has said it will cap council rates to CPI to 'contain the costs of living in Victoria'. Please see minutes of 21 April 2015, page 1008.

So what does Manningham council think of this?

They don't like it one bit.

First Manningham council complains about 'cost shifting' from the State and Federal governments. That is, the state and federal governments are getting local councils to do more but are not giving them the money to do it.

That could be understood in few different ways.

For example, local government rates typically increase by 5% or more per year. So the state government could think that local councils are adequately funded and can do more with what they already receive. Evidently Manningham council thinks otherwise. If this interpretation of the state government's approach is correct, then I could not agree more with the state government.

Also, local councils request that they 'fully participate in the development of the framework' to cap local government rates.

What was that?

The councils say they want 'sufficient flexibility embedded in the framework to enable it to be implemented in each council in a manner which responds to particular local needs and demands'.

Just what are the councils getting at?

The state government wants to cap council rates to CPI, and you would think that is meant to benefit all Victorians.

What do local councils want to do? Do the councils want to be able to override the rate capping when they think fit? Do they want the ability to override the CPI increase if they think it necessary?

Just what do they mean when they say 'responds to particular local needs and demands'? It sounds a good thing, but just what are they getting at?

Manningham council also requests that the impact on the wider community be considered should rate capping proceed.

So just what would the impact of rate capping be on the wider community?

Well, to start with, you and I would have more money to spend on essentials. That is a good benefit. But Manningham council does not mention that.

Manningham council says that their spending stimulates the Victorian economy. They claim their spending boosts many industries and the construction industry is mentioned. (points 1 and 3, page 1008).

So taking money from us and spending it stimulates the local economy.

However, if you let us keep our money so we can spend it on what we want, that would stimulate the economy as well. Again Manningham council did not mention this other side of the equation. [In another article I go into detail regarding the profligate spending of Manningham council and point out that what they spend benefits a fortunate few suppliers who charge our council far more that what private people and private organisations would pay for similar products and services].

They also say that reducing their spending will have a social impact. I assume they think that if they cannot provide all the services they currently do, then some people might go without. But there are two things to consider here.

First, there is a possibility that some might go without council services. But, on the other hand, there is so much duplication, triplication even quadruplication of services when you consider private organisations and local, state and federal governments. Diabetes is an excellent example of quadruplication of services. There are diabetes services provided by private organisations and by all three levels of government: Federal, State and Local. So I ask, does this waste and nonsense have to continue? And does our council even need to be involved in some of these areas? I am sure there could be simplification and rationalisation of such services with very large savings in cost.

Second, why doesn't the council consider managing costs carefully - that is getting rid of waste - and end up doing more with less? As I have mentioned elsewhere on this site, Manningham council is stubbornly resistant to any suggestion of controlling their own costs. I have come to think they may not actually have the skills to do so.

However, council expects certain contractors to reduce costs when the council stands to benefit from it. Manningham council  pressures their waste contractors to reduce costs. So they are aware of the need for cost control and cost savings, but they stubbornly refuse to reduce their own internal costs and expenses.


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