Pensioners could be paying $250 a year more in their rates, if the State Government adopts a recommendation to replace a concession with a deferral scheme.
The deferral scheme would mean that a current $250 yearly rate subsidy would eventually need to be paid back when the pensioner sells up or passes away.
The change was suggested by the Independent Pricing and Regulatory Tribunal (IPART) who were appointed by the State Government to review the Local Government Rating System.
While Penrith Council stated their position against the change in a submission to IPART, it struck a chord with Councillor Greg Davies.
“It’s screwing over pensioners,” Cr Davies said.
“When they sell the house and move because they are downsizing, they will have to repay the subsidy out of the sale of the property. Say over 10 years, they have to pay back $2,500 that the Government was previously subsidising.”
The recommendation also suggested it should be charged interest at the State Government’s 10 year borrowing rate plus an administrative fee.
Cr Davies said the concession scheme helped people who have worked hard to get a house to stay in it, but a deferral scheme is nothing of the sort.
“[The deferral scheme] is not a subsidy, it’s just a loan,” he said.
“We are trying to cater for an ageing population, but we can’t afford to give $250 a year to pensioners? You’re kidding me aren’t you?”
Council’s submission stated that a deferral scheme is very unlikely to be welcomed by pensioners as it will only defer their rates payments out of their estate.
That and 33 other submissions to IPART’s recommendations came before a meeting, where Councillors claimed they didn’t have enough time to properly discuss it before submissions closed.
Cr Davies said Council needs to be vocal.
“If the Government says no one is complaining, they will adopt it,” he said.
The Weekender asked NSW Minister for Ageing John Ajaka whether he supported the recommendation regarding pensioners but he remained tight-lipped.
“The NSW Government will consider IPART’s final report when it is released later this year,” he said.