FAQs - Operational Plan

In the Operational Plan we are: 

• Budgeting for a deficit of $2.7m (before capital grants and contributions) due to higher depreciation costs and inflation. 
• Increasing rates in line with the NSW Government’s 3.7% rates revenue cap (noting that this increase is well under current inflation costs). 
• Outlining $68.5m worth of projects and capital works, including many exciting projects covering areas such as increasing our green canopy, investing in public spaces and facilities, delivering road improvements and upgrading our technology platforms to make it easier for customers. 
• Increasing the domestic waste charge by 10% to cover future costs including preparation to deliver separated food and green organics collections and treatment. 
• Increasing the majority of our fees and charges by 7% to accommodate inflation, noting some fees and charges may not increase by this amount due to type of service being provided or statutory limitations. 

The draft Operational Plan is proposing $68.5 million in funding for projects and capital works in 2023/24.  

These projects will help protect the Council’s environment, increase green spaces, enhance recreational facilities, create vibrant local centres and foster connected and liveable communities. 

Major 2023/24 project and capital works funding includes: 

• $27.6m for the Willoughby Leisure Centre upgrade

• $3.4m for the Artarmon local centre streetscape upgrade

• $3m for asset renewal and refurbishment of Council’s Victor St meeting and office spaces 

• $2m to develop a revised business case and concept plan for the Gore Hill indoor sports complex 

• $1.4m to renew the synthetic surface at Thomson Oval, Artarmon 

• $1.3m to construct the Artarmon Parklands Pavilion

•  $850,000 to design and construct the Naremburn local centre streetscape

• $515,000 for the Chatswood Lunar New Year festival. 

The $68.5 million in projects and capital works funding includes $2.2m set aside for unforeseen project costs associated with the current economic climate, and for other priority projects as required.  

A full list of all proposed 2023/24 projects and capital works can be found within the Operational Plan. 

• Total revenue raised from the levying of land rates continues to be capped by the NSW Government, through the Independent Pricing and Regulatory Tribunal (IPART). 

• In 2023/24, the Council will increase rates revenue by 3.7%, which is the cap set by IPART. 

• The 3.7% rate increase will result in a $1.9m increase in Council’s rate income. 

• It should be noted that the 3.7% rate cap will cause significant financial issues for the Council, as it will not allow the Council to recoup the costs of inflation and employee costs which are increasing well above this amount. 

• In fact, the difference between actual cost increases, and the rate peg, will amount to $4.2 million in the 2023/24 year alone. 

• It should be noted that eligible pensioners receive a statutory reduction of 50% of the combined rates and domestic waste management charge to a maximum of $250.  

• Pensioners and qualifying self-funded retirees also receive a $158 reduction in the domestic waste management charge. 

• The 3.7% increase refers to the increase in the amount of rates revenue the Council will collect, not the rates bill increase for each property owner. 

• Some 56% of all Willoughby’s residential ratepayers pay a standard minimum rate amount, as their property values are lower relative to all properties within the LGA. 

• For residential property owners, the minimum rate amount will increase by 3.7% from $849.80 to $881.20 (excluding the Domestic Waste Management Charge).  

• The rates amount for the other 44% of ratepayers is linked to the value of their land. 

• During 2023, new land valuations were announced by the Valuer-General (for the first time in four years). As is usually the case, land valuation changes differed across the LGA, which means it is possible that individual property owners will see their rates increase at a level greater than 3.7%, or even fall, compared to their 2022/23 bill.  

• In addition, eligible pensioners will continue to receive a discount of $250 off their rates bill. 

• For more information on Willoughby rating in 2023/24, see https:// www.willoughby.nsw.gov.au/Council/News-and-media/WCC-Rates-Factsheet 

• Not necessarily. It depends on what is happening to other land values across Willoughby. 

• Rates for each property are calculated based on the individual property’s share of the total land value within the Willoughby Local Government Area (LGA). 

• In addition, the amount of rate income collected by the Council is fixed – it is not linked to overall land value changes in the LGA.  

• We divide this fixed income by the total value of land in Willoughby to calculate a rate amount for every dollar of property value.  

• We then apply this rate in the dollar to each property to calculate the amount of rates due. 

• Think of Council’s rates income as a large pie.  

• Your rates are calculated based on your property’s share of this pie.  

  • If your property's share of the pie is larger than the last time properties were valued, you will pay more in rates. If your share of the pie is less than the last time properties were valued, you will pay less.

  • So if all properties in Willoughby increase by the same or a higher percentage than your property, your rates will stay the same or decrease (because you have a smaller share of the pie).

• For more information on Willoughby rating in 2023/24, see https:// www.willoughby.nsw.gov.au/Council/News-and-media/WCC-Rates-Factsheet 

• Inflation – Inflation increased by 7% in the year to March 2023, which was nearly double the Reserve Bank of Australia’s forecast. This high inflation impacts Council’s recurring expenditure on goods and services (44% of total Council expenditure) as well as Council’s asset replacement and capital expenditure such as plant and machinery making everything considerably more expensive. 

• Employee costs – These represent 38% of total Council expenditure and are forecast to increase by 5% annually over the next two financial years. Increases arising from a new Local Government Award, and the increase in statutory superannuation from 10.5% to 12%, add further pressure to our forecast. 

• Rates revenue capping – The Council’s rates income is limited by a cap set by the Independent Pricing and Regulatory Tribunal (IPART). In contrast to inflation running at 7% in the year to March 2023 and employee cost increases of over 5%, the annual rate peg increase permitted by IPART was just 3.7% for 2023/24.  This means cost increases are increasing more rapidly than revenue increases, placing significant pressure on the Council’s financial position. 

• Cost shifting - An increase in “cost shifting” from the State to local governments has occurred,  including the NSW Government’s waste management, emergency services, planning and parking levies and an increase in the cost of running local elections. The Emergency Services Levy alone has increased by 63% since 2018/19. 

• COVID-19 - Council lost $20.6 million of revenue as a direct result of the COVID pandemic. We are still down $3m per annum in revenue from pre-Covid levels. 

• Extreme weather events - Council sustained significant damage through storms in 2019, 2020 and 2021 with fallen trees, localised flooding and infrastructure damage leading to clean up and repair costs. Our waste services were impacted due to landslides across the regional railway line resulting in higher additional costs for alternative waste disposal. 

• Increased consumer expectations - With a change to working from home and increased environmental responsibility, consumer expectations of local infrastructure have changed adding pressure on services such as open space maintenance, upgrades to sporting facilities, higher volumes of waste, reduced income from parking, urban greening and streetscape upgrades.  

• A 10% increase in the Domestic Waste Management Charge is required due to:  

  • Increased waste management volumes resulting from more residents working from home

  • High inflation levels 

  • The need to fund the up-front investment and ongoing incremental costs associated with adoption of the State Government’s Waste and Sustainable Materials (WaSM) Strategy which includes mandating the separation of food and garden organics for households and selected businesses. This item alone is forecast to increase waste management costs by between 8% and 16%. 

• The 10% increase will result in the Domestic Waste Management Charge rising from $561.50 to $618 in 2023/24 

• It should be noted that eligible pensioners receive a statutory reduction of 50% of the combined rates and domestic waste management charge to a maximum of $250.  

• Pensioners and qualifying self-funded retirees also receive a $158 reduction in the Domestic Waste Management Charge.