Local council rate increases would be capped at the consumer price index - currently 2.9 per cent - if Labor wins the November state election.  

Councils wishing to raise their rates above CPI would have to appeal to the Essential Services Commission and justify the increase,  according to the election commitment.

As local councils across Victoria finalise their budgets for the coming financial year, some are reporting rate increases more than double CPI. 

The rises come as the federal government promises to hand down a tough federal budget. 

Monash Council is forecasting a 6 per cent rate increase, Strathbogie Shire Council a 7 per cent rate increase and Yarra City Council is proposing a 5.4 per cent rate increase. 

‘‘At the moment the [commission] makes sure that Victorians pay a fair price for gas, water and electricity. It is the sensible authority to determine council rates,’’ Labor said.

The Municipal Association of Victoria angrily attacked Labor’s proposal.  

“Rate rise restrictions leave councils with two main choices – reduce services relied on by communities or reduce capital spending to maintain assets.  National studies continue to show the quality of NSW local infrastructure is lower than other states, primarily as a consequence of years of rate-capping,’’ association president Bill McArthur said. 

“This short-sighted Labor policy to gain voters will wreak long-term community pain for all Victorians.’’

The Napthine government declined to support or reject the policy. 

Instead Local Government Minister Tim Bull said new performance and reporting measures to make councils more accountable to ratepayers would come in from July 1.    

‘‘It would be remiss of the government to make further comment until it has seen details of the Labor proposal,’’ Mr Bull said.