Penrith residents will have the state government rather than council to blame if their rates spike again later this year, according to a local councillor.
Cr Karen McKeown has called for a briefing by Penrith City Council in light of state government changes to the way the Emergency Services Levy (ESL) is collected, coming into effect on July 1.
The state government currently determines the budget for provision of emergency services including metropolitan and rural fire brigades, as well as the State Emergency Service (SES).
More than 73 per cent of that funding comes from the ESL paid by insurance companies, while local councils contribute about 11.7 per cent from general revenue, and the state government provides 14.6 per cent.
Household insurance policy holders pay the ESL charged to insurance companies through their premiums.
But from July 1 this year the state government will use ratepayers’ land value as one factor to calculate the Emergency Services Property Levy (ESPL) and the responsibility to collect contributions will fall to local councils, which will also continue their contributions from general revenue.
Cr McKeown said council should get the message across that it was not to blame for the extra charge on rates bills.
“Under the new scheme the insurance companies will be cut right out and it will be council’s responsibility to pretty much collect all of it and send it to the state government,” she told the Star.
“This is not a council levy, it’s a state government levy.”
The levy will come on top of the rate peg determined by the Independent Pricing and Regulatory Tribunal (IPART), which has been set at 1.5 per cent for 2017/18.
Penrith City Council’s Special Rates Variation (SRV) for 2017/18 is five per cent.
Cr McKeown also questioned which government would own the debt if rates went unpaid, and said the changes would result in “double dipping”.
“I renewed my household insurance in January, but come July 1 I will get that bill again in my rates,” she said.
“Technically that should not be happening.
“The insurance companies should not be charging for that.”