ESL announcement good news for councils in the short term

Councils already struggling to fund services and maintain infrastructure amid rising inflation and falling real revenue have welcomed the NSW Government’s decision to cover the large increase in the Emergency Services Levy (ESL) in 2022-23.

But peak body Local Government NSW (LGNSW) has warned that without real reform of the emergency services funding process, the move simply kicks the can down the road for another year.

President Darriea Turley said councils were grateful to NSW Treasurer Matt Kean, who announced over Easter that the State Government would kick in an additional $43 million to cover the increase in the Emergency Services Levy (ESL) currently paid by councils.

“I want to thank the Treasurer, Local Government Minister Wendy Tuckerman and Minister for Emergency Services and Resilience Steph Cooke for helping us to drive this decision,” Cr Turley said.

“The $43 million recognises the incredible financial pressure councils have been placed under over the last three years, further exacerbated by the recent floods.

“Covering the increased costs of the ESL for the third year since 2019 is a welcome relief, and I don’t want to take away from the importance of that announcement in any way.

“But this is only a temporary reprieve.

“The increase in the ESL will form part of the cost base that councils will have to fund in the following years.

“And the fact that this is the third year in a row that the Government has been required to step in shows that something is very, very wrong with the funding process as it stands.”

Cr Turley acknowledged the three Ministers were working hard to find the best solution for councils and communities struggling to make it back from more than three years of drought, bushfire, pandemic and floods.

While welcome, the decision to absorb the ESL cost rise for a third year running is just a temporary reprieve.

“We all recognise and support the need to properly fund fire and emergency services,” she said.

“But we can’t just keep kicking the can down the road; we need to get to the root of the problem.

“That means developing a fairer, more sustainable funding system for the emergency services our communities need.

“Minister Cooke points out that the State Government has now spent $93 million to cover increases in councils’ 11.7% contribution to emergency services funding via the ESL.

“On current trends, that total cost could rise to as much as $150 million or more next year.

“LGNSW has long argued that the fairest and most transparent way to fund our much-needed emergency services is via a broad-based property levy.

“Local government stands ready and willing to work in partnership with the State Government to transition to a funding process that doesn’t penalise communities across NSW in need of council services and infrastructure such as parks, roads and footpaths.”

Source: LGNSW