Externalities

A significant proportion of our very high rate charges can be categorised as “externalities”.

We must all understand what an externality is, and learn to recognise them, before we can begin to address the issue of the shire costs. Unless we do this we run the risk of trimming our budget in ways that reduce the quality of life for residents while allowing the corporate profit takers to avoid their responsibilities and leave us with a whole range of externality costs. An externality is a cost of business activity that is not borne by the person or corporation undertaking that business.

A very simple example could be the cost of disposal of a glass wine bottle. Is the wine maker, who makes profit from selling the wine packed in a non-returnable bottle, paying the full cost of his business activity? Probably not, because if this was the case we wouldn’t be listening to a shire employee, Ilya Hastings, talk about the shire problem of glass disposal on the ABC. We have to pay Ilya Hastings for every hour he spends thinking, talking or writing about glass disposal. 

Another example is the second access road for Prevelly. The shire approved development knowing that a second road was needed, and the financial implications section ignore the cost of the second road, and ignore all the costs associated with the community battling against the proposal.

12.2.2 LOTS 501, 502, 503 AND 504 REEF DRIVE, GNARABUP – PROPOSED MIXED USE AND TOURIST DEVELOPMENT, GNARABUP

FINANCIAL IMPLICATIONS

No direct▼ financial implication, in the longer term the development will attract increase(sic) rates and tourism spending in the Shire.

(The rate/tax payers have to pay all the costs for the years of battling against inappropriate development. And then fund a second access road knowing that every tourist attracted here means higher rates.

▲weasel alert, direct or indirect the development corporation is not going to pay. We are. Whenever a report says “no direct cost” our councillors should be asking about the indirect costs, how much, who pays?)

RECOMMENDATIONThe council amended the recommendation by adding an additional condition:

B) That Council writes to relevant State Agencies, State Ministers and Political Representatives to request urgent consideration of a second access road to Prevelly and Gnarabup. To highlight the importance of having a second access road into Prevelly and Gnarabup due to fire management hazards and community safety.

As a consequence of the development in this shire the government of Western Australia has to discuss the road for Prevelly. How much per hour is that costing? Every time we have attend a meeting we must cost the hourly rate for all those around the table, plus the support services before and after the meeting, plus travel time, etc, etc

Extract from Hansard [COUNCIL - Thursday, 28 February 2008]

BUSHFIRE — LEEUWIN-NATURALISTE REGION

Hon BARRY HOUSE to the parliamentary secretary representing the Minister for the Environment:

(1) Is the minister aware of last week’s serious bushfire which threatened sections of the Leeuwin-Naturaliste National Park, Wallcliffe House, and property around Prevelly?

(2) As this is the latest in a series of fires over the years in that volatile area, does the minister support a secondary access road following the established strategic firebreak through the national park to provide the missing one-kilometre link—that is an approximation—between Baudin Drive and Rainbow Cave Road?

(3) If not, why not?

(4) What approaches have been made to the Department of Environment and Conservation on this matter over the years?

And another;

remember all the costs involved every time the House listens to a question,

Extract from Hansard [COUNCIL - Thursday, 26 June 2008]

BUSHFIRE — WALLCLIFFE ROAD, PREVELLY

697. Hon BARRY HOUSE to the parliamentary secretary representing the Minister for the Environment:

I refer to the answer to question without notice 106, given on 28 February 2008.

(1) What approaches have been made by the Department of Environment and Conservation to local stakeholders following the fire in the vicinity of Wallcliffe Road near Prevelly in February this year?

(2) What action has been taken in response to these discussions?

(3) (a) What progress has been made on the development of a secondary access road following the established strategic firebreak between Baudin Drive and Rainbow Cave Road;

(b) will this be constructed by February 2009; and

(c) if not, when will it be constructed?

Hands up who knows how many more times Barry House and others raised the issue of a second access road? Who can estimate how much this has cost us to date?

Just an externality of the inappropriate development?

The development corporation takes all the profits and society/community, whatever you want to call us, bears the cost of remedial work necessary to make the homes safer. We also bear the social costs.

Remember this wasn’t some shock horror, “We never thought that would happen!” moment, this was a planned requirement noted in the Council Minutes when the development was approved by our shire.

So why would our shire approve this?

We can create a number of scenarios that might suggest why, but within the Council Minutes there is no reason given, but a hint of a “not my fault” clause that just might give them wriggle room in the event of culpability.

·       GBPL lodged a claim for compensation for $5.7 M against the Shire in December 2001, relating to the injurious affection that was suffered as a result of the Shire’s decision.

So we know we are dealing with bullies. How do we cope if we feel we are bullied?

In the case of Gnarabup we just cave in to their demands after floundering along for some very expensive ineffectual arguing. Please read the article below, apologies for the poor quality, having some trouble with the AMRMail website or I would have linked, rather than retrieved such degraded stuff from the archives.

Wow, we got a public toilet!

Don't celebrate too quickly because that's another cost on your rates, for the ongoing maintenance and cleaning.

So we have a situation where the corporate bullies can take the profit from developing in our locality, and then leave us with all the costs, the high rates, the increased bushfire risk, the damaged economy that comes with a huge number of absentee owners, our frustration and anger at wasting our time battling against inappropriate development proposals, and most of all great sadness.

Sadness too, that our fathers and grandfathers gave their youth so that we could have democracy and we are too weak to defend our rights. We let the bullies win. This has developed a profound sense of learned-helplessness within our community, which debilitates and degrades the confidence of youth. Why are our young people disengaged from local government? Read the article above again if you don’t already know the answer. They see local democracy is a lost cause in this shire.

Our community needs to make a stand against the bullies.

Make the externalities part of the business cost and then we will see some very different development in this shire.