East Gippsland Shire Council has kept its average rate increase below both the state government cap and inflation for the second consecutive year, despite staring down a 20 per cent surge in insurance premiums and aggressive cost-shifting from the state level.
Releasing the newly adopted 2026/27 Budget last week, mayor Cr Jodie Ashworth said councillors made a deliberate choice to shield local households and businesses from intensifying macroeconomic pressures.
“The average rate increase is set at 2.5 per cent, below the State-imposed cap of 2.75 per cent and well below inflation, which is currently around 4.2–4.9 per cent,” Cr Ashworth said.
“Rates are necessary to keep our core services running, but our demographics and geography often require duplication of services to ensure all communities are supported. This comes at a cost that must be balanced against our commitment to support communities.”
Rates represent the backbone of municipal operations, generating 51 per cent of the total revenue required to fund day-to-day services like waste collection, road repairs, street cleaning, libraries and parks maintenance.
To bridge the financial gap caused by keeping rates low while materials and services costs climb well above inflation, council has embedded $1.5 million in fresh organisational savings and efficiency measures into this budget cycle. This sits on top of more than $2 million in permanent structural savings achieved during the 2025/26 financial year.
Compounding the pressure on council’s bottom line is a wave of external cost-shifting, particularly from the Victorian Government. Cr Ashworth highlighted animal registrations as a prime example, where the state government has hiked its statutory levy on every cat and dog registration or renewal by over 90 per cent.
Rather than passing the full blow on to families, council has absorbed a portion of the state hike, staging local animal registration fee increases to between $3.50 and $20 a year (an average rise of 13.5 per cent).
Similarly, state-imposed landfill levies, heightened compliance demands, and escalating fuel prices have placed major upward pressure on the shire’s waste services, which must operate on a strict full cost-recovery model. Most other general user fees and charges across the shire will rise by a standard 2.75 per cent.
On the property front, council has carefully adjusted its differential rating system to ensure the burden is shared equally. Annual property valuations are conducted independently by the Valuer-General Victoria, and council has tweaked the rate-in-the-dollar metrics so that property owners across all classes experience a uniform average increase of 2.5 per cent.
The 2026/27 differential breakdown includes:
– General residential: Set at 100 per cent of the rate in the dollar, generating $42.8 million.
– Commercial / Industrial: Set at 129 per cent of the rate in the dollar, generating $6.2 million.
– Farming: Set at 74 per cent of the rate in the dollar, generating $6.2 million.
The municipal charge has been locked at $257 for the 2026/27 financial year, though 37 per cent of local farming properties will be exempt from this fee because they operate as part of a single, unified farming enterprise.
To support the region’s vulnerable residents, council has allocated $483,000 to fund dedicated pensioner rate rebates. This local relief will sit directly on top of standard State Government concessions to help eligible pensioners navigate the rising cost of living.
Looking ahead, the shire’s Financial Plan assumes a conservative annual growth of one per cent in the underlying rate base and service demand, with rate revenue projected to increase in line with standard CPI assumptions from 2027/28 onward.
“We’ve worked hard to strike the right balance – keeping rates as low as possible while still investing in roads, community facilities and the services that matter most to our residents,” Cr Ashworth said, encouraging any ratepayer experiencing genuine financial hardship to make contact with Council to arrange relief options.
