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Rate Peg

IPART is responsible for setting the rate peg for NSW councils each year.

Rate Peg -  2015/16

Rate peg to apply in the 2015/16 financial year will be 2.4%. For more information, see the Fact Sheet and Media Release.

WHAT IS THE RATE PEG?

The rate peg determines the maximum percentage amount by which a council may increase its general income for the year. For almost all councils general income consists entirely of rates income. For a small number of councils, general income also includes some annual charges such as drainage levies. The rate peg does not apply to stormwater, waste collection, water and sewerage charges.

Under the Local Government Act, councils are able to seek additional increases in general income beyond the annual rate peg, by applying to IPART for a ‘
special rate variation

HOW DID WE SET THE RATE PEG FOR 2015/16?

The rate peg is mainly based on the Local Government Cost Index (LGCI), which measures price changes over the past year for goods, materials and labour used by an average council. We deduct a productivity factor from the LGCI to strike a balance between ensuring that councils can meet the increased costs of delivering services resulting from price changes and ensuring that councils share productivity gains with ratepayers.

We calculated the rate peg for 2015/16 by:

  • taking the increase in the LGCI for the year to September 2014 of 2.47%
  • deducting a productivity factor of 0.04%.

This resulted in a rate peg of 2.43% which we rounded to 2.4% for 2015/16.

Local Government Cost Index

The Local Government Cost Index (pdf 458.9KB) was developed by IPART, following a survey of councils by IPART in 2010. For more information on the Local Government Cost Index click here.

ENQUIRIES

Enquiries regarding income setting and the annual rate peg may be directed to:
Michael Seery at Michael_Seery@ipart.nsw.gov.au or by telephone (02) 9290 8421
Kumi Cuthbertson at Kumi_Cuthbertson@ipart.nsw.gov.au or by telephone (02) 9290 8479

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