Skip to content Skip to main navigation

News

Avani Terraces - Greenway
Life is looking up

Ratepayers to feel the pinch as ACT Government spends up on infrastructure

By Glynis Quinlan - 6 June 2017 40


The ACT Government believes it is on track for its budget to be back in balance in the 2018-19 financial year despite the Mr Fluffy hit on its books in 2014 and a big-spending infrastructure program for health, schools and public transport.

However, ratepayers will feel the pinch with rates to again rise by around seven per cent in the coming financial year and for each year in the foreseeable future.

Unit owners will be slugged with an added rate increase for each of the next two years, paying an extra $150 in 2017-18 and a further $115 in 2018-19.

The 2017-18 ACT Budget brought down today has a projected deficit of $83.4 million with a forecast of returning to a small surplus of $9.7 million in the 2018-19 financial year.

Big ticket items include an increased investment of $443 million in health, $210 million more for local schools and $53.5 million to design the route for Stage Two of the light rail network to Woden.

Many of the commitments in today’s Budget have been foreshadowed during a flurry of ACT Government announcements in recent weeks but details of a new $500 million centre for Canberra Hospital were released today.

The Government has committed $236 million over the next four years to design and start construction of a new Surgical Procedures, Interventional Radiology and Emergency (SPIRE) Centre within the Canberra Hospital precinct.

The centre will have a ward dedicated to elective surgery and offer world-class radiology services. It will also have a much larger emergency department with a separate paediatric ward.

Features of the new SPIRE Centre include:

  • a larger intensive care unit with 48 beds
  • a 24-bed coronary care unit
  • more inpatient wards with 64 beds for overnight care
  • more elective and day surgical spaces
  • state-of-the-art surgical, procedural and imaging facilities

Once the SPIRE centre is built, the current emergency department will be dedicated to providing specialist emergency healthcare for women and children.

Other Government funding commitments in the 2017-18 ACT Budget include:

Health

  • Almost $70 million to expand the Centenary Hospital for Women and Children, delivering a new ward with another 40 maternity beds
  • $17.3 million to renovate the existing acute aged care and cancer facilities at the Canberra Hospital
  • $14 million over five years to build and plan for new nurse-led Walk-in Centres in Gungahlin, Weston Creek and the Inner North
  • $12.1 million to build a new health centre for Aboriginal and Torres Strait Islander Canberrans
  • $3.3 million to begin planning for enhanced northside hospital facilities
  • $16.1 million to ensure full operational readiness for the new University of Canberra Public Hospital to open in 2018
  • $4 million to invest in initiatives as part of a new preventative health strategy to reduce the burden of chronic disease
  • $3.2 million to purchase and operate two additional mobile dental vans to provide dental care closer to home for those who need it
  • $2.7 million to establish a new Year 7 health check for Canberra students
  • $36 million to train and support more frontline health staff, including 12 new nurse navigators to support patients with complex needs
  • $2.7 million to establish a new University of Canberra clinical school for nursing, midwifery and allied health

Education

  • $100 million for upgrades to ACT schools including $85 million to public schools. The upgrades include $5.9 million for stage 3 of the Belconnen High School Modernisation, upgrades and extensions to new and existing classrooms, and new gardens and horticultural facilities
  • $26.2 million to expand schools in Gungahlin, including Harrison School, Gold Creek School, Neville Bonner Primary School and Palmerston District School
  • $17.2 million provision to deliver technology-enabled learning devices for students, helping to ensure that every public high school and college student has access to a device
  • $16.1 million for school assistants to help provide better support for teachers
  • $3 million to support students with disability
  • $3.3 million to improve the safety of students walking and cycling around schools
  • $2.4 million to fund the first five of 20 new psychologists for public schools
  • $1 million for safer workplaces for teachers, educators and support staff

Public Transport

Funding of $65 million over four years to improve Canberra’s public transport network, with initiatives to include:

  • $53.5 million for the second stage of light rail between the City and Woden
  • $7 million for free travel on two new Rapid Bus routes, free off-peak buses for seniors and concession card holders and to continue the Free City Loop, Airport and Route 182 Weston Line services
  • $2.1 million to progress procurement of integrated bus and light rail ticketing and investment in ticket machines
  • $1.7 million for faster bus travel though bus priority infrastructure, bus service improvements and new bus stops

An investment in the 2017-18 ACT Budget of $54 million in upgrades to roads across the ACT including:

  • $35 million for stage two of the Gundaroo Drive duplication, replacement of the roundabout at Gundaroo Drive/ Mirrabei Drive/ Anthony Rolfe Avenue with traffic lights, a new four-way signalised intersection at the Federal Highway and Old Wells Station Road and stormwater works on Flemington and Morisset Roads
  • $8 million to construct an access road to the Canberra Brickworks Precinct
  • $6 million to investigate upgrades and duplication of the Monaro Highway and Pialligo Avenue
  • $4.5 million over three years for increased road resealing across Canberra
  • $900,000 for design works on upgrades to Bindubi Street and William Hovell Drive in Belconnen and east-west arterial roads in the Molonglo Valley

In addition, the Government has made a commitment of $8.3 million over four years into community transport through the Community Transport Coordination Centre, incorporating the Flexible Bus Service and special needs transport.

City Renewal

  • $59 million over four years to enable the City Renewal Authority to revitalise the CBD, Dickson and Northbourne Avenue and create a lakeside precinct in West Basin
  • $8 million over two years to revitalise Canberra’s shopping precincts
  • $4.7 million for design works and construction of the Belconnen Bikeway linking Belconnen Town Centre to educational and health institutions and Lake Ginninderra
  • $11.1 million to improve waste management, prepare for the rollout of a Territory-wide bulky waste collection service from 2018-19 and the introduction of a container deposit scheme
  • $5.4 million for the Quality Sportsgrounds Program
  • $4.5 million over three years to resurface up to 150,000 square metres more of roads each year
  • $3.1 million to renovate Woden Town Library and improve public access to library records
  • $2.3 million for city services in Canberra’s new suburbs
  • $1.9 million over two years to remove more weeds along major roads, provide more street art coordination and graffiti removal and the like
  • $1.3 million over two years to better control weeds in Canberra’s urban open space, along rural roadsides and within nature parks
  • $1.2 million to ensure we can better manage animal welfare including more funding to the RSPCA and expanding the size of the pound
  • $5.3 million nightlife package which will deliver a variety of initiatives including $4.9 million over four years for six additional police officers to patrol nightlife precincts

What’s Your opinion?


Post a comment
Please login to post your comments, or connect with
40 Responses to
Ratepayers to feel the pinch as ACT Government spends up on infrastructure
1
dungfungus 4:55 pm
06 Jun 17
#

The artist’s impression of the upgraded Canberra Hospital has a helicopter over the top which indicates that is where the landing area will be.

Didn’t the government just spend hundreds of thousands of dollars on upgrading the existing heli-pad?

2
JC 5:30 pm
06 Jun 17
#

dungfungus said :

The artist’s impression of the upgraded Canberra Hospital has a helicopter over the top which indicates that is where the landing area will be.

Didn’t the government just spend hundreds of thousands of dollars on upgrading the existing heli-pad?

All this and that is the best you can come up with? Must mean the budget meets with your approval then.

3
HiddenDragon 5:54 pm
06 Jun 17
#

The Budget Papers released today estimate that general rates revenue will total c.$487m in 2017-18 ($172m. commercial and $315m. residential) with c.$268m revenue from property conveyancing duties ($74m. commercial and $194m. residential).

By way of nostalgic comparison, the figures for 2011-12 were c.$209m. for general rates (separate figures not given for commercial and residential) and c.$268m. for property conveyacing duties, with c.$47m from insurance policy duties.

So for all the talk about “simpler, fairer taxes” etc. etc. conveyancing duty revenue is unchanged in nominal terms (in a period of notably low inflation), and general rates revenue has increased by 133% (or 110% if the insurance duty phase-out is discounted against the general rates increases).

Let’s just hope that there are truly robust measures in place to ensure that ACT ratepayers are properly compensated for all the new health and other services which are provided by the ACT and utilised by residents of NSW.

4
Lucy Baker 6:01 pm
06 Jun 17
#

Why can’t the Brickworks developers pay for their own road into their development and pass the cost on to high-end home buyers? That $8 million could be spent on redressing social disadvantage or any number of other, social good possibilities.

5
Rover 7:45 pm
06 Jun 17
#

As a unit owner in the inner south, my rates look like going up by 24 per cent, which will take them up to almost $1700 a year. That may seem reasonable, but consider that I also have body corporate fees to pay for things like waste management, mowing, carpark lighting – all the things that people in freestanding houses get as part of their rates.

Added together, my annual bill will be $5000 for a two-bedroom unit. And surprisingly, my body corporate fees have actually decreased by about $200 a year over the past four years due to good management.

6
oh_ 10:53 pm
06 Jun 17
#

Rover said :

As a unit owner in the inner south, my rates look like going up by 24 per cent, which will take them up to almost $1700 a year. That may seem reasonable, but consider that I also have body corporate fees to pay for things like waste management, mowing, carpark lighting – all the things that people in freestanding houses get as part of their rates.

Added together, my annual bill will be $5000 for a two-bedroom unit. And surprisingly, my body corporate fees have actually decreased by about $200 a year over the past four years due to good management.

The rates increases on units are starting to bite (albeit they were off a low base) but as noted, added with body corporate fees its getting steep. Also if its rented or vacant, add land tax to that – ouch. Also units have not gone up in value much since about 2009 (in fact many have come down since 2010-11 peak). Houses on the other hand, have done really well so I have a lot less sympathy for owners who cry poor at the rate increase – sorry but your house has gone up way more, in most areas by hundreds of thousands, you can afford it more.

7
wildturkeycanoe 9:09 am
07 Jun 17
#

oh_ said :

Houses on the other hand, have done really well so I have a lot less sympathy for owners who cry poor at the rate increase – sorry but your house has gone up way more, in most areas by hundreds of thousands, you can afford it more.

That is totally irrelevant to home owners unless they intend to sell their home. Who cares if your house is worth more if you intend to live in it for the next 20 years. The rates increases plus home loan interest rises, on top of stangating wages will make home ownership more of a struggle. Sure the investors will be laughing, but families will do it tougher. A better home valuation is no reason to celebrate if it is eating into your grocery bill to avoid default on the mortgage.
I have little sympathy for the unit owners, as they know full well the costs involved are offsetting the lack of yard maintenance and other costs borne by house owners. They are also getting better public transport, something the outer suburbians hope for in vain.

8
Mysteryman 10:09 am
07 Jun 17
#

HiddenDragon said :

The Budget Papers released today estimate that general rates revenue will total c.$487m in 2017-18 ($172m. commercial and $315m. residential) with c.$268m revenue from property conveyancing duties ($74m. commercial and $194m. residential).

By way of nostalgic comparison, the figures for 2011-12 were c.$209m. for general rates (separate figures not given for commercial and residential) and c.$268m. for property conveyacing duties, with c.$47m from insurance policy duties.

So for all the talk about “simpler, fairer taxes” etc. etc. conveyancing duty revenue is unchanged in nominal terms (in a period of notably low inflation), and general rates revenue has increased by 133% (or 110% if the insurance duty phase-out is discounted against the general rates increases).

Let’s just hope that there are truly robust measures in place to ensure that ACT ratepayers are properly compensated for all the new health and other services which are provided by the ACT and utilised by residents of NSW.

Andrew Barr lied through his teeth about rates not tripling over an 11 year period, and he lied through his teeth about the massive hikes to rates being “revenue neutral” as stamp duty gets phased out.

He and his government are turning Canberra into a place that only the wealthy can afford.

9
Maryann Mussared 10:27 am
07 Jun 17
#

Lucy Baker said :

Why can’t the Brickworks developers pay for their own road into their development and pass the cost on to high-end home buyers? That $8 million could be spent on redressing social disadvantage or any number of other, social good possibilities.

I agree, but Dudley Street is currently a disaster with traffic backed up during peaks from all over Canberra, going into Deakin. Upgrading Dudley Street is an alternative to the original Mint Interchange which was going to be $50 million. The road from the Brickworks will have access to this already overused road, so the planning for the new intersection is very important. There has been talk of a roundabout which many can’t see working.

10
Garfield 11:28 am
07 Jun 17
#

HiddenDragon said :

The Budget Papers released today estimate that general rates revenue will total c.$487m in 2017-18 ($172m. commercial and $315m. residential) with c.$268m revenue from property conveyancing duties ($74m. commercial and $194m. residential).

By way of nostalgic comparison, the figures for 2011-12 were c.$209m. for general rates (separate figures not given for commercial and residential) and c.$268m. for property conveyacing duties, with c.$47m from insurance policy duties.

So for all the talk about “simpler, fairer taxes” etc. etc. conveyancing duty revenue is unchanged in nominal terms (in a period of notably low inflation), and general rates revenue has increased by 133% (or 110% if the insurance duty phase-out is discounted against the general rates increases).

A good reminder for people that ACT Labor’s claims that their tax reform would be revenue neutral was a bald faced lie.

11
moody 12:04 pm
07 Jun 17
#

Rover said :

As a unit owner in the inner south, my rates look like going up by 24 per cent, which will take them up to almost $1700 a year. .

Ouch. Yes I live in the sad old units in Woden, and my annual keep of it is now $5800 (body corp, rates, water). Reason I brought this place is I know I’ll always be an average income earner, so had to get a unit that had already depreciated, and cheap to maintain. Brought it in 2010, it’s now worth $30k less then I paid for it. Yes it was bad timing. I knew it wasn’t ever going to increase in value (always easy to build more units). I had hoped my last exit from it would be in a box, so I didn’t care so much.

Justification was back then, what I’ll likely lose in value, I may save in lower rates. Canberra was in a property squeeze then, finding a place to rent was tough.

However may have to think about leaving Canberra, which is a shame I like it here. Thankfully my work I can get pretty much anywhere, and my role should be easy to be replaced…perhaps someone with a working partner, for even having the upkeep of a cheap unit on one average wage is becoming less viable.

Renting it would be 15.6K per annum, I don’t know how landlords make any money. I didn’t add land tax in my estimate. (though of course they have tax deductions, gearing, etc)

12
Holden Caulfield 12:45 pm
07 Jun 17
#

oh_ said :

Rover said :

As a unit owner in the inner south, my rates look like going up by 24 per cent, which will take them up to almost $1700 a year. That may seem reasonable, but consider that I also have body corporate fees to pay for things like waste management, mowing, carpark lighting – all the things that people in freestanding houses get as part of their rates.

Added together, my annual bill will be $5000 for a two-bedroom unit. And surprisingly, my body corporate fees have actually decreased by about $200 a year over the past four years due to good management.

The rates increases on units are starting to bite (albeit they were off a low base) but as noted, added with body corporate fees its getting steep. Also if its rented or vacant, add land tax to that – ouch. Also units have not gone up in value much since about 2009 (in fact many have come down since 2010-11 peak). Houses on the other hand, have done really well so I have a lot less sympathy for owners who cry poor at the rate increase – sorry but your house has gone up way more, in most areas by hundreds of thousands, you can afford it more.

Some good observations there, but lolwut at your last comment. Explain to me how an appreciating asset improves weekly cash flow?

13
chewy14 1:28 pm
07 Jun 17
#

Garfield said :

HiddenDragon said :

The Budget Papers released today estimate that general rates revenue will total c.$487m in 2017-18 ($172m. commercial and $315m. residential) with c.$268m revenue from property conveyancing duties ($74m. commercial and $194m. residential).

By way of nostalgic comparison, the figures for 2011-12 were c.$209m. for general rates (separate figures not given for commercial and residential) and c.$268m. for property conveyacing duties, with c.$47m from insurance policy duties.

So for all the talk about “simpler, fairer taxes” etc. etc. conveyancing duty revenue is unchanged in nominal terms (in a period of notably low inflation), and general rates revenue has increased by 133% (or 110% if the insurance duty phase-out is discounted against the general rates increases).

A good reminder for people that ACT Labor’s claims that their tax reform would be revenue neutral was a bald faced lie.

How is it a lie?

They never said that the overall tax amount wouldn’t increase (which would be stupid), they said that the mix of taxes would change such that the change would be revenue neutral.

They’d still be receiving the same amount of total revenue today without the changes, simply where that money was sourced from has changed.

14
frankh 1:37 pm
07 Jun 17
#

Rover said :

but consider that I also have body corporate fees to pay for things like waste management, mowing, carpark lighting – all the things that people in freestanding houses get as part of their rates.

Mowing and car park lighting are not services that the ACT Government provides to freestanding houses. If you look closely at your body corporate fees the vast majority of it will be made up of insurance, lift maintenance, gardening, sinking fund and management fees. These are things that freestanding house owners have to cover themselves.

Looking at a recent ACT Government revenue/expenditure fact sheet http://apps.treasury.act.gov.au/budget/budget-2014-2015/budget-paper-2/revenue-and-expenditure .

32% of ACT Government revenue comes from Rates and other taxes
43% of ACT Government revenue comes from Commonwealth Grants

When you look at where ACT Expenditure goes

57% Health and Education
22% Justice, Public Housing, Policing, Disability

The vast majority of expenditure for the ACT Government are per capita expenses. Your dwelling type or location isn’t one of the causes of major expense for the ACT Government.

The questions I have are

Is it fair and equitable that you pay a different contribution to these per capita expenses based upon:
– your dwelling type ?
– your suburb ?

Is it fair and equitable that rates don’t take into account:
– household income ?
– the number of people in the household ?

The net effect of this system is that you have Canberra residents that are paying a disproportionate contribution to the ACT Government coffers irrespective of their means to pay or the level of services that they consume.

The people who are going to have it the worst will be self funded retirees on fixed incomes who are long term residents of older suburbs. Yes, there houses might be worth more on paper but that money only exists upon sale of the house. It would be nice to think that we had some security of tenure on our homes as we got older.

15
bj_ACT 4:41 pm
07 Jun 17
#

chewy14 said :

Garfield said :

HiddenDragon said :

The Budget Papers released today estimate that general rates revenue will total c.$487m in 2017-18 ($172m. commercial and $315m. residential) with c.$268m revenue from property conveyancing duties ($74m. commercial and $194m. residential).

By way of nostalgic comparison, the figures for 2011-12 were c.$209m. for general rates (separate figures not given for commercial and residential) and c.$268m. for property conveyacing duties, with c.$47m from insurance policy duties.

So for all the talk about “simpler, fairer taxes” etc. etc. conveyancing duty revenue is unchanged in nominal terms (in a period of notably low inflation), and general rates revenue has increased by 133% (or 110% if the insurance duty phase-out is discounted against the general rates increases).

A good reminder for people that ACT Labor’s claims that their tax reform would be revenue neutral was a bald faced lie.

How is it a lie?

They never said that the overall tax amount wouldn’t increase (which would be stupid), they said that the mix of taxes would change such that the change would be revenue neutral.

They’d still be receiving the same amount of total revenue today without the changes, simply where that money was sourced from has changed.

As I have stated before, the Rates model is wrong and the taxes collected by the ACT Government over the last few years ‘have not’ proven to be revenue neutral. The rates model is hitting many Suburbs disproportionally, as I have pointed out previously on Riotact.

The Government announced in the Budget that Kambah Rates are rising 8% despite only a $4,000 increase in median House price from the year to end 2016. The Downer Rates are rising 9% despite a $79,000 median House price increase over the same period (and will be bigger again in 2017). You said this rates calculation differential would even out as it takes three years of land valuations, but it still isn’t happening and it won’t whilst ever the model ignores key factors in land value. This data can be checked on the Budget information site or in the Canberra Times article today. http://www.canberratimes.com.au/act-news/2017-act-budget-reveals-average-rates-increase-of-7-percent-20170605-gwknfv.html

The Rates calculation methodology to factor in landsize, aspect and view but ignore improved house value is flawed. The ACT Government do not properly collect and evaluate the actual dwelling value and it is not being represented in the UAV rates calculations.
The land rates increases are a river of gold for the ACT Government and it’s the poorest people in outer suburbs, with slowly increasing land values who are paying too big a share.

Analysis of actual home sales and annual land rates from AllHomes across all of Canberra, shows a big differential between actual house sales as a proportion of rates paid.

1 2 3

Related Articles

CBR Tweets

Sign up to our newsletter

Top
Copyright © 2017 Riot ACT Holdings Pty Ltd. All rights reserved.

Search across the site