Socialist Party Australia - We need a People's Budget!

SP's contribution to the debate around Yarra City Council's 05/06 budget

The Socialist Party joins Yarra residents in calling on Council to develop a budget for the people— not a right-wing budget that spends more on roads and consultants than on community services.

Yarra Council should be actively seeking to develop a democratic budget that reflects the needs of ordinary people in Yarra. This means encouraging real participation by residents, community groups and small businesses in the development of their budget. The Yarra Council 2005/6 Draft Budget has instead been developed by council in a process that is largely inaccessible to the people it will affect.

This leaflet outlines some ways the Socialist Party believes the budget should be changed so it represents the real needs of the community. It is a starting point for community debate around the Yarra Council Budget both this year and into the future. We want to encourage all residents and community groups in Yarra to participate in the development of their budget. Only in this way can we have a true People’s Budget that reflects the needs of the majority in Yarra.

The Council’s 2005/6 Draft Budget calls for:
• A 5.9% increase in rate revenue.
• $5.5 million for roads, but only $200,000 to improve family services including childcare.
• $2.2 million on advertising, publicity and for consultants – which is enough money to make meals on wheels free and still have $1.7 million left over.

Yarra Council is about to present its draft budget for 2005/06. You, as a local resident, will have only a month to have your say before Councillors vote on it on July 12th.

A do-nothing Budget
We have great needs in Yarra, especially in childcare and on the three massive public housing estates. Therefore you would expect big initiatives in this budget, but there are none. Even small businesses are not serviced properly with still no access to recycling, despite the pro-environment claims of Yarra Council.

The small improvements in the number of child care places and on resources to young people in need are to be welcomed – but we can do so much more.

What Council’s Draft Budget says and what it doesn’t say
The budget proudly boasts of its good parts (many of which came from community and Socialist Party pressure on and outside of Council) – but there is much it doesn’t report on – for example Yarra’s vital Financial and Crisis Counselling service is to receive only $31,000 this year compared to $83,805 two years ago!

Where does Council get its $94 million from?
Ratepayers are being asked to fork out an extra 4.9% in rates, with 5.9% extra to be generated in new rate revenue this year. It is ironic that the Socialist Party is the only party opposed to the screwing of ratepayer’s year in, year out for little in return by way of new initiatives by Council. It seems it is easier to raise money from ratepayers than take on the State and Federal government over cuts in grants to Council.

Fees and fines are to go up in most cases by about 3%, although after school care fees go up 9% per child per session.

Government grants (from State and Federal government) have been cut by 2.7% this year (page 11). This long-term cutting of Council money must be challenged. However a Labor-led Council will not take on a State Labor government, especially with a State election next year.

What are they spending our money on?
$60 million is for operating costs. $45 million of this is on wages but the budget papers do not make clear how much is on the mini-army of team leaders, co-ordinators and directors at Yarra, a Council that is top heavy with management. The community wants workers on the front line – for example there is no money for a second footpath trading officer, leaving only the one current officer to police over 1000 businesses.

$19 million is for capital works. Many of these projects are good but in some cases the priorities are wrong, with $5.5 million for roads, yet only $200,000 to improve infrastructure at child care centers.

$2.7 million is for debt repayment to the banks. This is being proposed even though Yarra hasn’t got “relatively high borrowing levels for a Victorian metropolitan local authority”, as the budget claims. In fact the State government recommends that total debt for a Council must be 60% of rate revenue or less – for Yarra this year it is only 29%.

While there is nothing wrong with Council reducing their debt, they have chosen to prioritize this over providing funding for essential services like child care, aged services and libraries.

This is just one example of how this Draft Budget puts money before people.

What could be done instead?
1. A less top heavy management structure and less spent on consultants would free up money for more socially-useful operating costs such as job creation for unemployed youth and lower fees for Council services.

2. A readjustment of the capital works away from roads and expensive projects like the nearly $1 million on information systems would add millions for use for three big projects that the Socialist Party stands for: A new child care center, a new North Fitzroy library, and a new indoor sports facility for Yarra. These three projects would be both a social and economic asset to Yarra.

3. A three year debt freeze would still leave Yarra ahead of State government guidelines and would allow about $10 million to be spent on progressive capital works projects such as the three the Socialist Party stands for. This is partially admitted on page 31 of the budget. Even a slowdown in debt repayment could deliver $5 million.

What are the best parts of Council’s Draft Budget?
Partially thanks to the recommendations of the Youth Advisory Committee, which was pushed for and chaired by SP Councillor Stephen Jolly there are new resources for holiday activities for young people in public housing; extra vacation care places; increased occasional child care, and more.

The $100,000 for a childcare review is to be welcomed and was agreed to as a direct result of the growing community pressure on Council to act on the crisis. The test will come when the area of greatest need for childcare is identified: will Council then create a new childcare center or not?

Principles behind the Council’s Draft Budget
This budget “has been prepared on the basis of constraint” (page 9) and its Budget Principles (page 6) include nothing about community need.

Council, despite calling itself left-wing, has prepared a right-wing (neo-liberal) budget. Since the end of the post-war economic boom in the early 1970s almost all western governments have begun the process of winding back conditions won in the past.

This ‘neo-liberal’ agenda has been carried though by governments on all levels through privatization, user pays, and cuts to services.

The fact is that though they are possibly slightly better on service delivery; Yarra Council is fundamentally no different from other Councils.

A Socialist-led Council would shift priorities towards ordinary people in Yarra as well as mobilising to fight the cost-shifting by government.

For more information about the Socialist Party or to find out more about our work on Yarra Council write to SP, PO Box 1015, Collingwood 3066. You can also visit our council website at: socialistpartyaustralia.org/council

Socialist Party City branch meets every Tuesday at 7pm at Trades Hall, cnr Lygon + Victoria Sts, Carlton South
Socialist Party Northern branch meets every Thursday at 7.30pm at radio station 3CR, 21 Smith St, Fitzroy