FARMER lobby groups across the country say changes in the rating system voted through by country Victorian council is just one case of primary producers being forced to shoulder a disproportionate amount of the rate burden in rural shires.
Councillors of the Ararat Rural City voted two week ago to abolish the differential rating system the municipality had in place, which means farmers will pay 100 per cent of a residential rate based on property values. Previously they had paid 55pc of the residential rate.
The Gannawarra shire in Victoria’s north-west is also looking at phasing out differential rating and will vote on the matter in mid-June.
Victorian Farmers Federation (VFF) vice president Brett Hosking, who is based in Gannawarra, said the proposal could lift total farm rates in his area by up to 40pc.
“There will be a 25pc increase in rates spread over four years and with an increase in valuations it could see farmers paying a lot more.”
Mr Hosking said based on the average dryland farm size in Gannawarra, rates could rise from around $15,000 per annum to over $25,000pa.
“For the larger guys, you see rate bills of over $50,000 so these increases are really going to hurt their bottom line.”
He said given Victorian municipalities were bound by a State Government-imposed rate cap, which stops councils raising total rates revenue by more than 2pc pa, the moves to raise more revenue from primary producers did not make sense.
“The changes won’t see shires raising any more revenue in total, all it will do is put farm businesses under pressure and drive jobs out of the region.”
“Farmers are happy to pay their share, but we don’t want to be shouldering the load.”
Mr Hosking said farmers were concerned some shire councillors did not understand the nuances behind differential rating schemes.
“It is worrying to see the apparent lack of understanding as to what the point is of differential rates.
“Shires have very few mechanisms to drive investment and stimulate jobs growth and differential rating is one of them.
“All these changes to the rating system will do is cut job opportunities locally and potentially see farmers, forced to seek savings in other areas of their business to make up for higher rates potentially shopping around outside their local area for their inputs, which is bad for everyone.”
Mitchell Clapham, NSW Farmers board member, said although there were different systems for gathering rates in NSW, the fundamental concerns were the same.
“In my local council, farmers make up 14pc of the rate base, yet pay 30pc of the rates,” the Mudgee farmer said.
“Our system differs to Victoria in some ways, but the basic concerns are the same, we want to see all the rate base, whether it be agricultural, residential or the mining sector pay their fair share.”
Mr Clapham, whose property lies within the Mid-Western Regional Council, said the situation had improved in his case with the election of new councillors last year, but said over the state as a whole it was still a concern.
“This year it has been good here in my shire, farm rates have not risen for the first time in a few years, but NSW Farmers is constantly pushing for equity in rating systems.”
Mr Hosking said farmers had contacted him saying they did not feel the system was equitable.
“You’ve got a situation where farmers are being asked to pay more, but miss out on services, very basic services such as bin collection or sealed roads that those in the shire centres get.”
Wally Newman, WA farmer and former Lake Grace shire councillor, said in his areas there had been success in addressing inequality in the spending distribution with a specified area rating-based system, which ensured rates collected in various parts of the large rural shire stayed in those areas.
“It was great in stopping all the collected rates being spent in the areas with the largest populations,” he said.
“There were general rates that went to the entire shire and then there was a block that was allocated specifically to the local area.
“We brought that in nearly 30 years ago and we found it worked well in ensuring a bit of equality.”
Mr Hosking said differential methods of raising revenue were nothing new.
“It’s not unprecedented, there are different brackets for tax if you are a business or a charity, taxation is constantly manipulated to help stimulate growth.”
Mr Newham said NSW Farmers was aware of the changing demographics of peri-urban councils.
“With amalgamations we have seen farmers become a smaller part of the population overall and a change in the demographic of councillors.
“We’d like to see some sort of independent avenue by which rating notices can be assessed or disputed if need be.”
Gregor Heard
Gregor Heard is ACM's national grains industry reporter, based in Horsham, Victoria. He has a wealth of knowledge surrounding the cropping sector through his 15 years in the role. Prior to that he was with the Fairfax network as a reporter with Stock & Land. Some of the major issues he has reported on during his time with the company include the deregulation of the export wheat market, the introduction of genetically modified crops and the fight to protect growers better from grain trader insolvencies. Still involved with the family farm he is passionate about rural Australia and its people and hopes to use his role to act as an advocate for those involved in the grain sector.
Gregor Heard is ACM's national grains industry reporter, based in Horsham, Victoria. He has a wealth of knowledge surrounding the cropping sector through his 15 years in the role. Prior to that he was with the Fairfax network as a reporter with Stock & Land. Some of the major issues he has reported on during his time with the company include the deregulation of the export wheat market, the introduction of genetically modified crops and the fight to protect growers better from grain trader insolvencies. Still involved with the family farm he is passionate about rural Australia and its people and hopes to use his role to act as an advocate for those involved in the grain sector.
