The Independent Pricing and Regulatory Tribunal (IPART) has not approved North Sydney Council's application for a Special Rate Variation (SRV).
Council had sought an increase of 45% in 2025/26 and 29% in 2026/27 to repair Council's financial position, maintain existing services, fund the renewal of ageing infrastructure, and deliver strategic priorities for the changing and growing population.
The timing of Council's special rate variation application was critical. Liquidity pressures because of the North Sydney Olympic Pool project have reduced renewal of infrastructure and depleted internal reserves. Restoring Council's liquidity must be Council's first priority.
While disappointed, Council respects IPART's decision and will now need to consider alternative strategies to repair the financial position.
What This Means
Without the additional revenue from the SRV:
- Infrastructure renewals and backlogs including North Sydney Oval, Stanton Library and sporting field upgrades are now unfunded.
- Actions identified in Council's long-term strategies will be deferred indefinitely.
- Service levels will be reviewed and reduced.
- Council's ability to respond to new requests from the community will be limited.
North Sydney Mayor Zoë Baker stated:
"Council made two separate applications to IPART, the first was to increase the minimum rate of $715 per year and the second was a special rate variation application seeking to address essential financial structural repair and infrastructure maintenance and renewal to set Council up for financial sustainability over the next 10 years.
It is incredibly disappointing that IPART refused both applications without considering even a partial approval of either, particularly the minimum rate application.
North Sydney Council's minimum rates, at $715 per annum, are one of the lowest in NSW. Over 77% of residents pay the minimum rate. That rate will apply to all of the new apartments planned as part of the significant population increase over the next ten years and is required to provide infrastructure and services to serve that new population.
This Council is determined not to "kick the can down the road" for a future generation to deal with.
The first-year increase requested in the special variation aimed to improve Council's liquidity position due to the North Sydney Olympic Pool project, ensure continued service delivery and supported broader infrastructure renewal.
As a councillor who fought tirelessly to stop the increased scale and rushed decision- making of the North Sydney Olympic Pool project, it pains me that the liquidity crisis caused by this project will continue to have impacts on Council's service delivery and capacity to maintain and renew infrastructure for the foreseeable future.
In addition to the pool project, the application sought to address an historical dependence on declining revenue and inadequate investment in renewal funding for infrastructure.
Without responsible financial management and provision of adequate funding, the burden shifts to the next generation or the one after that.
IPART's decisions highlight the urgent need for the State Government to adopt the recommendations of the recent Upper House Inquiry into the Ability of Local Government to Fund Infrastructure and Services and implement a separate process for structural financial repair.
North Sydney Council's financial position is very well known and has been widely reported in the media over many years. If a council like North Sydney, subject to significant public scrutiny in media across the State, is unable to effect financial repair through applications to IPART, the system is clearly flawed.
If the current SRV process is not able to fix a long-standing structural financial problem and plan for the future, we risk embedding ad hoc financial decision-making, moving from project to project and crisis to crisis. This approach does not offer certainty for financial sustainability nor for our community.
Council will be asking the State Government for a clear alternative pathway for structural financial repair.
Unfortunately, this decision means Council will have to make really tough choices and decisions. Service cuts, asset sales and other measures will have to be on the table - none of which support intergenerational equity."
Next Steps
Council will:
- Conduct a full review of all services and programs
- Identify opportunities for expenditure cuts and reducing operational costs
- Prioritise compliance and safety in infrastructure management, deferring all other projects
Our Commitment to the Community
Council thanks the community for its engagement throughout the past year. Council will provide updates as revised financial plans and decisions are made in response to this outcome.
