Independent Pricing and Regulatory Tribunal (IPART)
Level 16, 2-24 Rawson Place
SYDNEY NSW 2000
To the IPART Panel,
I am writing to formally oppose the Northern Beaches Council’s (NBC) application for a 39.6% rate increase. Community feedback to my office has been overwhelming in the rejection of this rate increase and it would appear to not meet the necessary criteria set out in the Office of Local Government’s (OLG) Guidelines for the Preparation of an Application for a Special Variation to General Income. Feedback shared with my office raised significant concerns about the application. These concerns, of which I share, are as follows:
- Failure to Demonstrate the Need for Additional Income via a Special Variation to Rates
The Council states that its underlying financial position is not sustainable as it is not generating sufficient funding to maintain community infrastructure and services at the level required. This is reflected in the Council’s 2025/26 budget which demonstrated that income levels are no longer sufficient to fund operating expenses, forecasting an operating deficit of $5.1 million.
Council has attributed these budgetary pressures to rising costs, inflation and unforeseen external pressures such as COVID-19 and natural disasters. While these certainly have played a role, they cannot be solely to blame for the position Council finds itself in today. In accordance with the Local Government Act 1993, councils are obliged to follow principles of sound financial management, and that spending should be responsible and sustainable, aligning general revenue and expenses.[1]
In accepting this reality, the next question that must be asked is whether Council has demonstrated that additional income is needed to warrant a special variation to rates. This submission argues that without first exploring all other cost-saving measures that are reasonable, NBC cannot sufficiently justify that a 39.6% rate increase is necessary to achieve financial sustainability. Just because it may be an effective strategy, does not make it the only strategy, nor does it make it needed or reasonable. Amid a cost-of-living crisis, passing an increase of this magnitude onto the ratepayer should only be considered when all other cost-saving measures have been explored.
If alternative measures to reduce costs and generate revenue exist and are feasible, they at the very least must be investigated to demonstrate to ratepayers that a 39.6% increase is in fact necessary. In pushing ahead with this application for a special variation to rates, Council has failed to provide sufficient evidence that these costs cannot be met, or alleviated, through other means.
- Evidence that the community is aware of the need for and extent of a rate rise.
Council has stated that a Special Variation to rates is required if Council intends to continue to meet community expectations and deliver existing services and service levels.[2] Meeting community expectation is therefore at the crux of the position Council finds itself in. On this logic, should the community no longer expect existing service levels, then a rate rise of this magnitude would not be necessary. Engagement is a vital mechanism to assist Council to better understand these evolving expectations and incorporate public will and concerns into decision-making. In fact, NBC’s Community Strategic Plan 2040 explicitly states that ‘genuine participation is essential so Council can better advocate on behalf of the community on complex issues that are beyond Council’s direct control’.[3]
As such, Council rightly undertook an extensive, $173,000 public consultation (‘Have Your Say – Funding Our Future’) spanning eight weeks, which included sending letters to every ratepayer, face-to-face engagements, and an opt-in survey. The consultation put four options to the community: 1. reduce services; 2. maintain services; 3. improve services (requiring a 39.6 percent rise of three years); and 4. increase services (requiring a 46 percent rise over three years). Council received roughly 6300 submissions, and the results were clear: community expectations have evolved to the point where a majority of residents would rather see services scaled back in favour of a rate rise. Despite more than half the residents who responded to the online survey requesting Option 1 (that there be no special rate variation), and a clearer majority of 64% selecting this as their first preference via mail, Council chose to ignore these results and push for the ‘Option 3’ rate rise of 39.6 percent over three years.
While community engagement is arguably the cornerstone of democracy, its true value is only realised when action follows. When engagement is ignored, trust is broken, and the very foundation of responsible governance is undermined. Although the Council did undertake community consultation, its decision to disregard the public’s feedback has defeated the purpose of the engagement, weakened the overall decision-making process, undermined public trust and called into question the rationale for the proposed rate increase.
Council’s community engagement on the prospect of a Special Variation to rates was very clear in explaining that without a rate rise, services would be scaled back or cut. As the results demonstrate, the respondents understood this ultimatum, and still indicated their preference to forego current services to avoid a rate increase. Despite this, Council have proceeded with the rate increase.
The timing of the consultation, which took place over the Christmas holiday period of last year, also raises concerns. A decision of this magnitude requires robust and transparent engagement with the entire community, and ample time for the community to digest what is being proposed. Conducting this consultation at a time when many are overseas, interstate or spending time with friends and families is ill-considered.
For these reasons, I do not believe that NBC’s community engagement has prosecuted the need for a 39.6 percent rate rise.
- Unreasonable Impact on Ratepayers
In accordance with the Office of Local Government Councillor Handbook, Councillors need to display leadership and integrity to help ensure that the decisions they make as a member of the governing body are in the best interest of all the community. It further details that a core principle for local government is that Council should carry out their functions in a way that provides the best possible value for residents and ratepayers[4]
Given the Council rejected an amendment at a Council meeting on Tuesday, 12 November to conduct a detailed report to examine every possible alternative cost-saving solution before an application for a special rate variation was considered, it cannot be said with certainty that the proposed rate rise is reasonable or provides the best possible value for ratepayers.
A 39.6% rate rise, coupled with additional levies on businesses, will place an excessive financial burden on households and small businesses. Many families in the Northern Beaches are already struggling with the rising cost of living, and an increase of this scale could force some residents to reconsider whether they can afford to remain in the area. Additionally, businesses – especially small and independent operators – will be disproportionately affected, potentially forcing them to close or relocate, which would negatively impact local employment and the vibrancy of the Northern Beaches economy.
The proposed business levy will place additional pressure on local businesses that are already contending with economic challenges. Small businesses are the backbone of our community, and imposing higher rates will lead to increased operational costs, which may be passed on to consumers or result in job losses. In the long term, this measure will deter new businesses from setting up in the Northern Beaches, reducing economic activity and leading to a decline in services available to residents.
- Conclusion
In summary, the NBC’s application for a 39.6% rate rise does not satisfy the Office of Local Government’s assessment criteria for special variation applications. NBC has not sufficiently demonstrated the need for a rate rise of this significance, nor has it engaged the community in a broad and meaningful consultation process. Finally, the impact that such a sizeable rate increase would have on ratepayers cannot be deemed reasonable in light of the current economic climate.
On these grounds, I urge IPART to reject this application in full.
Yours sincerely,
James Griffin MP
Member for Manly
19 March 2025
References:
[1] Councillor Handbook – Office of Local Government. Available at: https://www.olg.nsw.gov.au/wp-content/uploads/2024/09/Councillor-Handbook-2024 p54
[2] Northern Beaches Council: What you need to know about the rates special variation. Available at: https://www.northernbeaches.nsw.gov.au/council/news/what-you-need-to-know-about-rates-special-variation
[3]Northern Beaches Council Community Strategy Plan. Published November 2022. Available at: https://files-preprod-d9.northernbeaches.nsw.gov.au/nbc-prod-files/documents/2023-04/community-strategy-plan-dec22.pdf?1741143999 p54
[4] Councillor Handbook – Office of Local Government. Available at: https://www.olg.nsw.gov.au/wp-content/uploads/2024/09/Councillor-Handbook-2024 p9
Last modified: July 15, 2025
