Here’s an idea for forward-thinking, Local Government Agencies. The Victorian State Government has already cottoned on to this idea but, of course, innovation occurs when something is new to someone else.
Indexation! You only get criticism when people become aware that that they are being robbed.
Once you have legislated or proclaimed a system of indexing cost relativities, the robbing becomes surreptitious, legitimised and largely free of dissent or criticism.
The State Government in Victoria legislated a long time ago to index a plethora of government charges such as vehicle registrations, fines, stamp duties, etc, etc, so that the cost of these services and imposts increases annually to compensate (sic) for “cost of living” increases as represented by annual CPI amounts.
There won’t be any real push-back until some of these charges – say vehicle registration – compounds up to be greater in annual value than the actual purchase price of the vehicle being registered.
Now, if Local Government agencies choose to follow suite, they could link their largest income source to the values of properties that they rate. That way, they would not have to participate in an annual rate increase exercise – it would happen automatically.
It is interesting that two levels of government – State and Local – have both embraced some sort of logic that annual increases are (a) necessary, (b) somehow justified and (c) acceptable.
Rates and other household expenses are becoming absolutely horrendous as they expand exponentially due to the wonderful process of compounding interest.
So, to bypass the righteous and predictable indignation of ratepayers, local government agencies should deviously link rates to the “natural” increases in property values occasioned by the burgeoning housing market.
What a winner! No longer would these agencies have to be beholden to a State Government review of fair and reasonable caps for the annual robbery – they would have a pretty good idea of how much their income would be likely to increase on an annual basis by monitoring the many sources of information related to housing and land price increases.
This process could be made even more attractive by annual valuations rather than bi-annual ones.
And then, of course, there is always the bonus of new developments coming on line and increasing the actual “base” of the rate-take within a particular jurisdiction. This is truly the “cream” on the endless quest to collect OPM (other people’s money).
Now, I don’t think anyone else has thought of this brilliant scheme, but I am putting it out there in a true spirit of sharing and caring. Just trying to help! (Yes, I do have my tongue in my cheek.)
Kevin Mackay, Inverloch.