Rate Peg 2022-23

For the first time, the amount that councils will be able to increase the revenue they can collect from rates by will depend on their level of population growth. 

IPART has set a 2022-23 rate peg for each council, ranging from 0.7% to 5.0%.

IPART’s rate peg takes into account the annual change in the Local Government Cost Index (LGCI), which measures the average costs faced by NSW councils, in addition to a population factor based on each council’s population growth. 

The rate peg is the maximum percentage amount by which a council may increase its general income for the year.

For more information on the 2022-23 rate peg, see our Information Paper and Media Release.  The rate peg and population factor for each council is available in this spreadsheet. Please note that we have updated these documents since their original release at 10am on Monday 13 December 2021.

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.

Councils have discretion to determine how to allocate the rate peg increase between different ratepayer categories.

How the rate peg is set

The rate peg is mainly based on the Local Government Cost Index (LGCI). The LGCI measures price changes over the previous year for the goods and labour an average council will use. We also look at productivity changes over the same period. We now also include a population factor for each council to take population growth into account.

How the rate peg affects individual rates

The rate peg sets the maximum increase in each council's general income for the financial year. The rate peg applies to general income in total, and not to individual ratepayers’ rates. As long as its general income remains within the set maximum increase, councils may increase categories of rates by higher or lower than the rate peg.

Individual rates are also affected by other factors, such as land valuations which can affect percentage changes to rates alongside the rate pegging process. The rate peg affects some other council fees in addition to household and business rates.

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'.

Assumed rate peg for 2023-24 and future years

Special variation applications

Councils applying for a special variation in 2022-23 should use the 2022‑23 rate peg set by IPART, and an assumed rate peg of 2.5% for 2023‑24 and in future years.  Further information about the special variation process is here.

Long term financial plan reviews and updates

We encourage councils that are updating or reviewing their Long Term Financial Plans to refer to the Office of Local Government’s Integrated Planning and Reporting Manual for local government in NSW, and to seek advice from the Office of Local Government where necessary to determine their revenue forecasts for rates and charges for future years.

Rate Peg in recent years

Year

Rate Peg

Fact Sheet

Media Release

2022-23

Table

Information Paper

Media Release

2021-22

2.0%

Fact Sheet

Media Release

2020-21

2.6%

Fact Sheet

Media Release

2019-20

2.7%

Fact Sheet

Media Release

2018-19

2.3%

Fact Sheet

Media Release

2017-18

1.5%

Fact Sheet

Media Release

2016-17

1.8%

Fact Sheet

Media Release

2015-16

2.4%

Fact Sheet

Media Release

2014-15

2.3%

Fact Sheet

Media Release

2013-14

3.4%

Fact Sheet

Media Release

2012-13

3.6%

Fact Sheet

Media Release

2011-12

2.8%

n/a

Media Release

2010-11

2.6%

n/a

n/a

2009-10

3.5%

n/a

n/a

2008-09

3.2%

n/a

n/a

2007-08

3.4%

n/a

n/a

2006-07

3.6%

n/a

n/a

2005-06

3.5%

n/a

n/a