Rate capping | LGA Value Proposition | 2018-19 Annual Business Plan | China’s National Sword | LGA Schemes No Images? Click here Vol 3: Issue 19 - Monday 21 May 2018 There’s a lot going on in local government at the moment. The Government is yet to introduce its rate capping legislation, and when this happens we’ll be consulting with councils and calling a Special General Meeting to determine the sector’s position. It was pleasing to see the Hon Justin Hanson MLC and Hon Russell Wortley MLC voicing their opposition to rate capping in the Parliament this week. We thank them for their continued support in fighting a policy that has been voted on and unanimously rejected by the LGA membership. The State Government’s support package to address China’s revised waste import restrictions provides little relief to ratepayers, with the Solid Waste Levy still set for a 15% hike in 2018-19. Elsewhere, insurers are hovering, using the threat of rate capping to try and break up the successful mutual model we have in SA. LGA President Mayor Lorraine Rosenberg Rate cappingWe are still waiting to see the Government’s rate capping legislation, which we understand is likely to be introduced into Parliament in June. There is still uncertainty about the Government’s proposed model and what will be in and out to fulfil their pledge to cap not only rates, but also council fees and charges. Councils will need time to carefully analyse the impacts of the proposed rate capping model within their community, and as soon as the legislation is released we will provide it to member councils for their consideration and feedback. The LGA will also convene a Special General Meeting to provide councils with the opportunity to discuss the legislation, and then vote on a final sector-wide position on the Government’s proposed model. LGA Value PropositionIf you haven’t already seen the LGA’s 2018 Value of Membership Report, you can download a copy here. Produced by UHY Haines Norton, this report indicates that the average annual value of services provided by the LGA to members is around $2 million per council. This is an achievement that we are very proud of, but we will always strive to get better. Our new constitution and governance arrangements embed a requirement for the LGA to produce an annual Value Proposition to outline and value the specific membership benefits provided to members each year. If you have any questions, or would like us to come and present to your council on the value in LGA membership please let me know. 2018-19 Annual Business PlanAt our Board meeting last Thursday we endorsed the LGA’s 2018-19 Annual Business Plan. This document incorporates feedback received from council members and staff through our Members Survey, and outlines the following key priorities for the coming financial year:
In partnership with the State Government the LGA will continue to roll out the Regional Youth Traineeship Program, Community Wastewater Management System project, and State Local Government Infrastructure Partnership. We will also continue to develop the Council Emergency Management Planning Program, to better support the sector in its planning for emergency events. The full minutes from the May LGA Board meeting will be on our website later this week China's National Sword PolicyLast Wednesday I met with Minister Speirs to discuss the Government’s $12.4 million support package to address the impacts of China’s National Sword Policy. I thanked the Minister for making this funding package available, while also expressing my disappointment that it didn’t extend to freezing increases to the Solid Waste Levy. Freezing this Levy would have provided councils with immediate relief, and helped shield ratepayers from the short term impact of this policy. Let’s be clear – there is currently around $100 million that has been collected through the Solid Waste Levy (much of it from ratepayers) sitting in the Green Industry Fund. The Levy is expected to increase a whopping 15% from 1 July, and will generate an additional $34 million paid by councils into the fund next year. From this the Government is releasing a $12.4 million support package, which will essentially see ratepayers footing the bill for boosting the recycling industry in SA. The Government’s support package is comprised of:
Applications for funding are now open, and further information is available on the Green Industries website. LGA SchemesLast week insurance brokers AON suggested they could shield our sector from the impacts of rate capping by splintering the mutual fund model that is in place in SA, and signing councils up to individual insurance contracts. Like sharks smelling blood in the water, they’ve seen an opportunity to use the threat of rate capping to boost their own profits. While all South Australian councils are currently members of the LGA’s Schemes, membership is – and always will be – voluntary. A number of South Australian councils have market tested alternative insurance arrangements over the past few years, but all have resolved to stay with the Schemes, which is testament to the value they deliver. 100% membership of the Schemes in SA is a significant strength as it enables all councils to benefit from economies of scale. Importantly, it also fosters confidence with the State Government and the delivery of cooperative arrangements unique to South Australia, such as the Treasurers Indemnity that allows the Schemes to provide members with unlimited civil liability protection in the event of catastrophe. As outlined in the LGA’s 2018 Value of Membership report, the Schemes deliver more than $33 million in annual value to our sector. It’s worth noting that the model we have in SA is also the preferred model around Australia – 98% of councils are members of a mutual fund. We believe that aggregated procurement is a proven strategy to reduce costs for councils, and the Schemes are the flagship of this approach. The LGA already achieves significant savings for councils by jointly procuring a range of products and services such as electricity, and we are continuing to expand the aggregated service opportunities available to SA councils through LGA Procurement and LGA commercial services. For further information or to submit |