New regulations released by the State Government will prohibit local councils from charging interest on rates that are deferred due to financial hardship. This update aims to provide relief for ratepayers facing significant challenges, expanding the definition of hardship to include a broader range of circumstances.
The Casey Council has confirmed it already waives interest for residents who have been approved for financial hardship deferrals, but its current publicly available hardship policy predates the new guidelines. As a result, an update is required to align with the changes mandated by the state.
Overview of New Hardship Guidelines
The guidelines, issued in December 2025, instruct councils to treat ratepayers experiencing hardship with fairness and compassion. They specify that councils must cease charging interest when payments are formally deferred due to financial distress. The new stipulations recognize various hardship scenarios beyond mere inability to pay, including:
- Sudden job loss
- Illness and mental health issues
- Family violence or economic abuse
- Caring responsibilities
- Scams or fraud
- Incarceration
- Natural disasters
This comprehensive approach allows councils to temporarily defer payments, giving residents essential breathing space during difficult times. More severe cases of financial hardship, where paying rates would compromise basic needs like food and housing, qualify for additional support.
Although quarterly instalments remain the standard billing method, councils are encouraged to offer more flexible payment options, such as weekly or fortnightly payments. Councils must ensure that if a payment plan follows a hardship deferral, no interest is charged.
Current Measures and Future Updates
At present, the Casey Council provides various measures to assist its community, including flexible payment plans for all ratepayers. Mayor Cr Stefan Koomen noted that a new payment gateway introduced in September 2025 allows residents to manage their rates through tailored payment schedules. “This puts residents in control of their payment schedules and lets people manage payment in the way that works for them,” he stated.
The council confirmed it has not charged interest on overdue amounts under these payment plans for several years, even though the existing 2021 Rates Hardship Policy suggested otherwise. Under that policy, ratepayers could apply for deferrals, waivers of interest, and even waivers of rates and charges.
“If someone has been approved by Council for a financial hardship deferral, then no interest is charged,” explained Mayor Koomen. The council regularly revisits these approvals to ensure that circumstances remain unchanged. The council is working on updating related policies to comply with the new Ministerial Guidelines, with an updated hardship policy expected for presentation by mid-2026.
The need for reform is pressing, as the Casey area has seen a rise in rate arrears over the last five years, attributed to the impacts of the Covid-19 pandemic and increasing living costs. President of the Casey Residents and Ratepayers Association (CRRA), Anthony Tassone, emphasized that these changes come at a crucial time for local households facing financial strain. “People in our community are hurting financially. Rising living costs, insecure work, illness, and unexpected life events are pushing many households to the brink,” he said.
Tassone highlighted that halting interest on deferred payments and pausing enforcement during the assessment of hardship applications could prevent residents from falling into cycles of debt. “These changes help people stay engaged with the council instead of falling into a spiral of arrears and debt recovery,” he added.
Despite the positive outlook, Tassone stressed that the effectiveness of these reforms hinges on the speed with which councils implement the necessary changes. “We’re urging Council to update its policy as a priority and clearly communicate the new protections to ratepayers,” he urged.
Residents seeking to apply for a rates payment plan or assistance due to financial hardship can visit the Casey Council website for more information: casey.vic.gov.au/apply-rates-payment-plan and casey.vic.gov.au/rates-financial-hardship.
