Support for local governments to help communities during COVID-19

Treasurer Ben Wyatt and Local Government Minister David Templeman last week made a range of announcements around local government finances and operations during the pandemic. The announcements, which include an additional debt facility for local governments and direction on how to operate, will equip local governments to enable relief and recovery within their boundaries.

Starting from 1 June, local governments will be able to apply to the WA Treasury Corporation for short term loans to secure their cashflow that will enable normal operations to continue. To receive a loan, the local government must demonstrate the impact that the pandemic has had on their cashflow this financial year and the expected impact over the next financial year.

Other considerations that will be made in assessing loan applications include the applicant’s ability to pay, as well as existing revenue from service charges and developer contribution fees. Although there is no limit to loan amounts, the scheme is capped at $100 million and is also available to universities. The WA Treasury Corporation will waive loan guarantee requirements for these loans and has reduced the interest borrowing costs by 70 basis points.

In addition to the loan scheme, an order has been made under recently passed legislation that prevents local governments from charging interest to ratepayers experiencing financial hardship due to the pandemic. The order from the Local Government Minister also caps the maximum interest rates on overdue payments for all other ratepayers.

Under the order, public meetings relating to council business have been deferred until the State of Emergency has been lifted, but various red tape requirements have been waived through previous announcements, to provide continuity of government for ratepayers. These include Planning Minister Rita Saffioti’s suspension of various Local Planning Scheme regulation requirements and the ability for various decisions, such as planning applications, to be conducted via electronic means.