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2:55 AM
A Culture of Spending Part 7 - More money, all the money we can get.

Did you know that when a large development takes place, such as a high density dwelling or other large development, the council takes what is called a 'development contribution' from the land developer. This can be a large amount of money and it is meant to pay for things the council will need to provide for all the additional people who will come to live in Manningham. For example, open space, entertainment facilities, child care facilities, and so on.

What the council overlooks is the fact that all these new people who come to live in Manningham will contribute significant additional money to the councils income from the rates they will pay. This new rate income is meant to pay for the facilities and services these new people will need and use.

Council thinks the additional rate income from new residents is not sufficient and want even more money. They also think that the 'development contributions' they currently get from land developers is not sufficient, even after you take the additional rates from new residents into account.

Manningham Council says they are currently missing out on 'development contributions' from developments (1 hectare or more) which take place in the back streets. Councils refer to this as 'infill development in established urban areas' (p 1017, minutes).

Council argues that they need this money because the cost of providing infrastructure is 'ever increasing' (so are our rates, by the way).

What our council does not mention is the fact that the Municipal Association of Victoria has produced a cost index for local councils. The MAV's own cost increase for 'Engineering Construction' for 2014/15 is 2.95% and for 'Non Residential Construction' it is 3.0%.

Our rates increase at 4.5% for the same period.

The conclusion that we can draw from this is that Manningham council certainly does not need additional money to cover 'the ever increasing cost' of infrastructure.

What Manningham council needs are lessons in how to manage properly and to not fabricate arguments and excuses out of thin air.

Manningham council has demonstrated again and again that they cannot control costs and that they allow suppliers to charge ridiculous amounts for the most basic of items. For example Manningham council pays around $250,000 for a public toilet. Think of the house you could build for $250,000. For this amount of money, all Manningham council can do is build a concrete box with toilet bowls, taps and wash basins. They are simply unable to manage costs and could not care less about the amounts of money they waste.

Their never ceasing cry is for more money. The last thing they would do is achieve more with less and actually manage processes and costs properly so they deliver better outcomes and services at reduced cost. Instead they come up with excuses why they can't. But we have to do precisely this in the private sector. But to government bureaucrats this sounds bizzare. They think that if they don't spend a lot of money on something then it simply can't be any good.


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