A new levy for funding fire and emergency services has sent over $25 million in taxpayers' money up in smoke, after it had been deferred indefinitely and could end up getting scrapped.
The Fire and Emergency Levy (FESL), a broad-based property tax supposed to replace a tax on insurance policies for funding the Rural Fire Service and State Emergency Service, was announced in December 2015 and was set to take effect from July 01.
But after it has been revealed that residential property owners would be set to pay double or triple their current amount despite being fully insured, Premier Gladys Berejiklian announced in late May that FESL's launch would be deferred and signalled that it could be dumped altogether,
The Sydney Morning Herald reported.
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Berejiklian blamed inaccurate Treasury modelling for the huge costs faced by commercial and industrial landowners under the new system.
Documents obtained by the NSW opposition showed that $11.14 million was spent on grants to implement the levy, including costs relating to "classifying all land in NSW, revising and testing software and other systems, providing notices of FESL classification to landowners, and public communications costs," the report said.
Meanwhile, treasury functions, including staff and contractors, advertising, and council software revision, made up $7.76 million of the costs; and a further $3.49 million was spent on salaries, advertising and other costs for the Emergency Services Levy insurance monitor.
Another $1.91 million went to software and system changes in the Office of State Revenue and $1.13 million on valuation services relating to FESL set-up and implementation costs,
SMH said.
Shadow treasurer Ryan Park said what the Treasurer called the “most significant reform of a generation... could also be the most significant waste of taxpayer funds,” as he slammed the government for “pulling the plug” on the levy “at the last minute.”
"How can the community trust a government which stuffed the levy up – then put it on hold 'indefinitely' after squandering more than $25 million?" he told the publication. "It just beggars belief."
Treasurer Dominic Perrottet said the government could not implement the reform once it found that some businesses would be paying thousands of dollars a year more, which “is not what we intended.”
"The costs we have accrued so far aren't wasted – we remain committed to reducing NSW's high rates of under insurance and to making the funding of our fire and emergency services fairer, but we will take the time to get it right," he told
SMH.
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