Premier Gladys Berejiklian has raised the prospect that a controversial new levy on property owners to fund fire and emergency services in NSW will be dumped altogether as she announced its indefinite deferral following a community backlash.
The Fire and Emergency Services Levy, due to begin from July 1, changed the funding model from one levied on insurance policies that is passed onto the policy holder to a levy on most NSW property owners.
But following revelations by Fairfax Media, Ms Berejiklian on Tuesday announced the new levy's introduction would be deferred indefinitely.
Fairfax Media has revealed that the amount that many residential property owners will pay is set to double or triple, despite them having been fully insured for years.
As well, it was revealed that some commercial property owners will be even harder hit, prompting the government to consider changes.
The decision means the government will be forced to put new legislation through the Parliament to reverse the laws introducing the new system that were passed only last month.
During a media conference, the Premier chose to focus on the increases faced by commercial and industrial land owners.
Ms Berejiklian said modelling of how much commercial and industrial land owners would pay under the new system did not match the reality of what they faced after July 1.
She insisted that modelling of how much residential land owners would pay remained accurate and was "fair" but that the government wanted to revisit the entire reform.
But asked if the government was preparing to dump the reform altogether, Ms Berejiklian said it would be reintroduced "only when we feel the system is fairer".
"We are deferring this until we get a fairer system," she said. "If we don't get a fairer system, we won't introduce it. But our intent is to defer until we get a fairer system."
Shadow Treasurer Ryan Park said the government was a "shambles" and "running scared" ahead of local government elections in September.
"Let's be really clear about why this announcement has happened today: the upcoming council elections mean that this government knows it will be annihilated right across NSW if they continue to push through this unfair tax," he said.
The new levy was first flagged by Ms Berejiklian when she was Treasurer in December 2015. Details of the new levy were announced by present Treasurer Dominic Perrottet in March.
At the time, the government estimated the average levy for NSW residential property owners would be $185, and calculated that the average fully insured homeowner would save about $47 a year.
This was because the levy portion of existing home and contents and motor insurance premiums would be removed under the change.
The government also argued the new system is revenue neutral and fairer because at present the burden of funding fire and emergency services falls solely on those who have insurance.
Ms Berejiklian and Mr Perrottet stuck by those claims on Tuesday.
