Ivan Dean, Speeches Index

Wednesday 21 November 2007

LOCAL GOVERNMENT (RATES AND CHARGES REMISSIONS)
AMENDMENT BILL 2007

Mr DEAN ( Windermere ) - Mr President, I will be fairly brief in relation to this matter. I must say that when I first picked this bill up I was excited but the excitement did not last too long because I thought that there would be an increase in the remission offered to our pensioners.

Mr Aird - Councils can make any contribution they like to remissions at any time they want to.

Mr DEAN - Of course they can. The excitement did not last too long, Mr President, and it soon had a lot of water poured on it. The fact remains that local governments are really reliant on rates and most councils around this State, I would suggest, are probably 60 per cent or thereabouts - and probably in some cases more - reliant on rates for the finances that they need to run a local government -

Mr Aird - Some of the bigger councils are more reliant on rates than they are on the Grants Commission allocation.

Mr DEAN - I can tell you the Launceston City Council, the one which I am familiar with, is about 60 per cent or thereabouts -

Mr Aird - Yes, but smaller councils are not like that.

Mr DEAN - No, so therefore it is incumbent upon councils to ensure that the rating system is right and they can ill afford, unfortunately, to provide relief to probably anybody in that regard because their funds are committed and they have huge infrastructure costs on top of a number of other costs that they must be able to cover for that year. They get grants, they get some support and some councils have an income through parking and hiring fees and other things. However, as I said, predominantly it is rates that look after a council.

There is a need for councils, in most instances, to increase their rates every year and that occurs. As I said to some people recently who approached me about this, when you see CPI adjustment going down that is when you might well see rates dropping as well but I would not hold my breath if I were you. I do not think it is really likely to happen.

Evidence shows that many people struggle to pay their rates and that is a difficult thing for councils to work with because the last thing that a council wants to do is to see a ratepayer put in the position of having to do other things to try to pay those rates. There are very few people who do not pay their rates or have a negotiated arrangements with council to pay them in some way. It is very rare that a property is sold for the purposes of recovering rates. Normally it only happens when people have abandoned the property, have gone off for whatever reason. Council will normally bend over backwards to help people with their remissions.

I think it was made perfectly clear during the recent huge property value increases that many of our people, and our pensioners who fit into this category, probably more so than a lot of others, are property rich but money poor, and that has created a lot of difficulties within this whole system. A number of pensioners I am aware of have taken up the opportunity to get a reverse mortgage for the purpose of paying their rates and some of their other accounts so it would be interesting to get those figures to see whether or not the number of reverse mortgages for that age group has increased. Properties previously valued at $80 000 to $90 000 all of a sudden jumped to $300 000 to $400 000 to $500 000 very quickly and of course the rates jumped up accordingly, causing some big problems.

This bill cuts some red tape. It has always been a concern of mine that the pensioners in this instance, those people entitled to a remission, have had to reapply every year before this when their circumstances have not changed in any way whatsoever. So it is good to see that amendment coming through. I want to quote from the rates officer at the Launceston City Council:

'There will be little impact for our pensioners.'

And she is talking about this bill.

'There is certainly not a change to enable more people to be eligible or an increase to how much is received. However more people may be eligible with the change to the means test to get a pension that has recently been brought in by the Fed's.'

That was the comment made by the rates officer within that council. So it is good to see the Federal Government making a change. It may well benefit some of those people and give more people an opportunity to get a rates remission.

When I first read the penalty section I had some concerns and wondered whether or not there is a need for that. We are talking about pensioners, we are talking about predominantly aged people, very mature people and we know that at times they do things not deliberately but their senses are such that they forget unintentionally to do things. A lot of people in this age group do not have assistance and are apt to make mistakes in relation to some of these things.

I suppose when you weigh it all up there needs to be some form of enforcement, ensuring that people entitled to remissions are the only ones that get them. When their circumstances change there has to be some mechanism to alert people that if their circumstances change they need to notify their local government, council, what the circumstances are that may change their right to a remission.

I suspect that it would not be used very often, that it would only apply where there has been a deliberate intention to get a remission that they are not entitled to. I suspect that there would be some very close checking of the circumstances through this process. I also notice that they are forced to answer questions in relation to their circumstances as well, and I wonder if the member for Nelson has picked up on that.

All in all, I support the bill. I would hope that there would be a lot of education, a lot of notification of these people who are entitled and who fit into the categories of changed circumstances here so that they know where they stand in relation to it.

I am not sure what goes out in the notices to these people but one would hope that the circumstances surrounding their rights for remissions are clearly set out.

It is well known that the Local Government Association has been pushing for a rates remission increase for a long time. It remains on their books and they continually raise that with the State Government. What the State Government says is that this State, I think, is currently paying a greater rates remission than any other State in Australia. Even if that is so, it still does not make it right and it does not mean to say that there should not be an increase in this State if the circumstances support it. If you look at the cost of living right across the board today, the cost of living increases are out of kilter with pension increases.

Each time the pension is increased, it is outweighed by all the other living costs that apply. That includes rates, it includes electricity charges which we now know are going to increase substantially in the next 12-month period, by 25 per cent, and whilst there is a remission there for pensioners at the end of it, those people will still be required to pay additional charges for electricity. These people are usually struggling to exist on what they are currently getting, so I think there needs to be a close look at all of the charges that these people are confronting.

I am disappointed that there was not a further remission increase for them, but nevertheless I will be supporting the bill.

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