NSW councils get one-year levy reprieve

John Barilaro says NSW councils won't have to pay the additional emergency services levy this year.
John Barilaro says NSW councils won't have to pay the additional emergency services levy this year.

NSW ratepayers may be spared service cuts after the state government announced a one-year reprieve for councils facing a hike in the emergency services levy.

Acting Premier John Barilaro and Local Government Minister Shelley Hancock on Tuesday said the 128 NSW councils would not have to pay the additional $13.6 million this financial year.

The government is raising the levy to help fund better workers' compensation coverage for firefighters diagnosed with one of 12 work-related cancers.

"The NSW government acknowledges that this additional cost presented challenges for councils, particularly those in regional and rural areas badly affected by the drought," Mr Barilaro said in a statement.

The government has faced pressure over the levy rise for months, with Local Government NSW - the peak body representing councils - warning in May that councils faced significant and unplanned budget shortfalls.

President Linda Scott on Tuesday said the argument wasn't with firefighters or their compensation but with the lack of consultation or warning.

"The first time councils knew they would be asked to cover the increase was when they opened the bill from Revenue NSW and saw levy spikes of up to $220,000," she said in a statement.

"These bills arrived well after most councils had finalised their budgets for 2019/20, leaving them no option but to cut funding for other areas such as infrastructure maintenance or services."

She said many regional and rural councils had been considering whether to refuse to pay any increase beyond the rate of inflation.

Ms Hancock acknowledged the time-frame for introducing the increased levy had "caused some angst".

"We will continue to consult with local councils to better manage the impacts of the emergency services levy especially on their annual budgeting cycles," she said.

Mr Barilaro said emergency services had long been funded through a cost-sharing arrangement between insurers, councils and the government and it was important that continued.

Shadow Treasurer Walt Secord described the announcement as a "cruel and crafty hoax", saying the government was "just kicking the can down the road for another year".

"This is not a fix. It is not a long-term plan," he said in a statement.

"The Berejiklian government is just giving the impression that it is bowing to pressure and the matter is still unresolved after more than two years."

Australian Associated Press