The emergency services levy funds the state’s Rural Fire Service.Brook Mitchell
As the new Labor government looks for budget savings,it has uncovered an “adhoc system” of funding in which the state has covered annual increases in the levy for councils since 2019,costing taxpayers $100 million over the past four years.
The new government would have had to fork out an extra $77.5 million in the coming financial year if it did not end the subsidy system,which was introduced by former deputy premier John Barilaro.
Instead,as councils begin receiving their notice of assessment next week,they will be told they will have to pay their full contribution towards the levy,which will rise from $143 million last financial year to $219 million next financial year. Had the former government not topped up the councils last year,their bill would have been $185 million.
The emergency services levy is split three ways,with insurance companies paying 73.7 per cent,the state government 14.6 per cent and local councils 11.7 per cent.
According to analysis seen by theHerald,the hike this financial year is a result of an 18.5 per cent funding increase ($156 million) to Fire and Rescue NSW as well as a 73 per cent ($137 million) boost to the State Emergency Service to bolster its capabilities on the back of recent flood emergencies.
The former Berejiklian government wanted councils to share the financial burden of the increase in the emergency services levy to fund reforms to workers’ compensation for firefighters suffering from work-related cancers.
However,after facing a fierce backlash from councils,which warned that any increase to the levy would force them to cut services and facilities,the Coalition in 2019 reversed its decision to force councils across the state to pay for an almost $14 million emergency services levy hike.
Labor MP for Campbelltown Greg Warren was also critical at the time,warning that an increased levy would force councils to either lift their rates or cut local services and infrastructure projects.
In response,Barilaro and then emergency services minister David Elliott announced a “one-year reprieve”,saying councils would not have to foot the bill for a $13.6 million increase that year.
“The NSW government acknowledges that this additional cost presented challenges for councils,particularly those in regional and rural areas badly affected by the drought,” Barilaro said at the time.
However,the arrangement continued,although there is no single line item in the budget detailing the subsidy. Instead,the most recent half-yearly budget says there is “0.0 per cent average growth per annum” for council levy contributions.
The government was contacted for comment.
In 2017,then premier Gladys Berejiklian’s to fund fire and emergency services in response to a backlash over sharp increases in what some property owners would pay.
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