FAQs

The adopted DPOP and Budget provide the most complete and accurate picture of Council’s expected financial position for 2026/27 based on the information available at the time they were prepared.  

Forecasts aren’t a guarantee; however, the 2027 Budget is based on reliable information. It uses the audited 2025 financial results (a set of financial statements like income, expenses, assets, and liabilities that have been independently checked by a qualified external auditor), the updated 2026 budget (QBRS2), and the budget guidelines set by Council in January 2026. 

Following public exhibition, the budget was updated to reflect significant new information, including Quarterly Budget Review Statement 3 (QBRS3) adjustments, higher inflation, and rising fuel costs. These changes have been included in the final 2027 budget that goes to Council in June. 

The Federal Budget released on 12 May also gave updated guidance on inflation. During the public exhibition period, the finance team reviewed updated information, including changes in service levels and cost increases, to ensure the adopted budget reflects the best available information at the time of adoption.  

Some financial risks and cost pressures cannot be fully quantified when the budget is prepared because they depend on future events, market conditions or operational factors. While Council includes its best estimates in the budget, the exact financial impact of some risks is uncertain and may change over time. The budget is affected by several key risks, including: 

The community’s ability to assess affordability and risk is currently limited by incomplete condition information for some infrastructure. As this information is collected, there will be increased certainty around the condition of assets, the risks associated with them, and the long-term funding required to maintain and renew them. 

For some asset types e.g. footpath and stormwater, condition information is still being collected and incorporated into Council’s asset management systems. As more information becomes available, Council’s understanding of future renewal needs and long-term affordability will continue to improve.  

Examples of these are: 

• Footpath condition information has been captured in 2025, with internal prioritisation to follow once road renewal planning is ahead of capacity to undertake planned renewals.   

• Stormwater condition information commenced a program of capture in December 2025 which will take circa-10 years to complete. Each pipe inspected generates a detailed condition report, which is being integrated back to Council’s asset register as it comes in. Progress is reported via DPOP reporting. 

Council has placed the draft Budget on public exhibition because legislation requires Council to publicly exhibit and adopt its Operational Plan and Budget within set timeframes, before all information for the financial year is available.  

Under the Integrated Planning and Reporting framework, Council must prepare a draft Operational Plan and Budget place it on public exhibition for at least 28 days, consider community feedback, and adopt a final version before 30 June each year.  

As a result, the draft Budget is prepared using the best information available at the time. Any significant updates that become available during the exhibition period are considered before the final Operational Plan and Budget are adopted by Council.  

Councillors have access to a range of information and opportunities to inform their decision on the final DPOP, including budget workshops, Finance and Infrastructure Review Panel (FIRP) discussions, Council reports, community submissions and the final budget updates presented before adoption. 

Councillors have set the budget parameters in January 2026, attended FIRP meetings which discussed the budget and took part in a dedicated workshop on funding strategies. Councillors also have the option to ask questions on the advertised paper before the meeting and can submit their own DPOP feedback before final adoption for consideration.  

Any feedback received during the public exhibition, along with updated financial information available before adoption, is also considered as part of the final decision-making process.  

Council recognises that today’s decisions have financial impacts for our future community and the sustainability of our services into the future. Strategies/decisions on infrastructure investment, service delivery, rates and charges, borrowings and the use of reserves – as well as how we manage risk all contribute to being financially sustainable  

To ensure that Council are able to make financially responsible decisions and manage risk we are working to improve the information available to support these decisions, including asset condition data, lifecycle costs and long-term financial planning. This will help Council better understand future funding requirements and the implications of decisions over time.  

An important part of this is ensuring essential services are sustainable into the future and we are adaptable to the changing needs of our community. Understanding – community priorities, what matters to them and needs so we can plan for future generations help us to ensure we can respond accordingly – community engagement plays a key role (commitment to continual engagement - community engagement strategy).   

This understanding will support better informed decision-making about Council’s priorities, services, infrastructure and revenue. It will help Council identify where decisions may be needed to balance these priorities, find efficiencies, adjust service levels and identifying revenue needs to ensure costs are managed responsibly and not unfairly passed on in the future.  

By making informed decisions, Council can balance the needs of the current community with its responsibility to maintain financial sustainability for future generations.  

Council determines the services it provides based on responsibilities under the Local Government Act 1993, community priorities and needs, and the resources available to deliver them. Decisions about services seek to balance community needs, demand for services and available resources.  

Council reviews services to assess whether they remain appropriate, effective and efficient. This includes considering whether a service is meeting community needs and making the best use of available resources.  

Recent service reviews were identified through Council’s financial sustainability plan where service deficits or operational inefficiencies had been identified. Council is currently developing a structured framework for future service reviews which will be completed in 2026/27.  

The findings of service reviews help inform decisions about service delivery, service levels and resource allocation. Depending on the outcomes of a review, service levels may need to be adjusted to ensure services remain sustainable and continue to meet community needs into the future.  

Decisions following service reviews are considered through Council’s governance and decision-making processes, including Executive Leadership Team review, Finance and Infrastructure Review Panel (FIRP) advice, where relevant and Council decision-making.  

There are no new or expanded services in the 2026/27 DPOP. If Council considers new or expanded services in the future, these proposals will be assessed through Council’s existing budget and decision-making processes, taking into account community need, costs and financial sustainability.  

The 2025/26 budget review highlighted the importance of ongoing discipline across the organisation to ensure that spending remains within budget. This means that if new budget priorities are identified, others will need to be reduced or removed to ensure Council’s financial position stays stable. This may result in reductions in levels of services provided to community.  

Any decisions to introduce new or expanded services are subject to Council approval through the formal process. 

The estimated annual Council charges for a typical residential property in 2026/27 are approximately $4,162, comprising around $2,317 for rates, domestic waste and stormwater charges, plus $1,845 for typical residential water and sewer charges.  

This estimate includes: 

TOTAL $2,316.38 

Actual charges will vary depending on factors such as a property’s land value, waste service, water consumption and whether the property is connected to Council’s water and sewer network.  

The estimated annual Council charges for a typical residential property connected to Council water and sewer services are approximately $4,162 in 2026/2/, increasing to $4,390 in 2027/28 and $4,636 in 2028/29.  

These estimates include average residential rates, domestic waste (120L red bin), the stormwater levy and typical residential water and sewer charges.  

These figures are estimates based on Council’s current long-term financial forecasts. Future rates assume a 3% annual rate peg, which is subject to approval by IPART. 

Future water, sewer and waste charges may also change as costs, regulatory requirements and future budget decisions are confirmed. Actual charges will vary depending on your property’s land value, waste service, water consumption and whether your property is connected to Council’s water and sewer networks.  

A three-year schedule for domestic waste management charges has not been published because the information needed to accurately forecast future charges is not yet available.  

IPART determines the annual limit for increases to domestic waste management charges and has not yet provided future limits. In addition, the future implementation of FOGO services is expected to increase waste management costs, however the timing of implementation has not yet been determined.  

Council will continue to communicate proposed rates and charges through the annual budget process and provide opportunities for community feedback during the public exhibition. Feedback received during the exhibition has also highlighted the value of presenting information in a way that makes overall household costs easier to understand.  

The DPOP, together with Council’s LTFP provide information about current and future financial planning. Following feedback received during this exhibition, Council has included additional information in these FAQs to provide a clearer picture of typical household costs and will continue to review how financial information is presented to improve understanding for the community.  

No Special Rate Variation (SRV) scenarios have been determined at this stage. Council will consider potential scenarios as part of the development of its LTFP, which is scheduled for completion in September 2026.  

The LTFP will model a range of financial scenarios for Council’s General, Water and Sewer Funds over the next ten years. If the LTFP identifies that an SRV should be considered, Council will consult with the community before making any decision about lodging an application with IPART. 

Community consultation is a mandatory part of the SRV process and would provide ratepayers with an opportunity to review any proposed increase, understand the reasons for it and provide feedback before an application is submitted.  

The draft Budget was prepared using the best information available at the time. As more up-to-date information about fuel prices became available Council updated its fuel assumptions for the final budget.  

When the draft Budget was prepared, the global fuel supply issue was only beginning to emerge and there was significant uncertainty about the likely impact on fuel prices. The Budget was therefore based on the most reliable information available at the time. As fuel prices continued to change during the public exhibition period, Council reviewed the updated information and revised its fuel and materials cost assumptions. This resulted in an increase to the forecast operating deficit but ensures the adopted budget reflects the best information available at the time of adoption. 

Fuel costs will continue to be monitored throughout the year, with any further impacts managed through Council’s existing budgeting and reporting processes.  

The draft budget exhibited to the community forecast a General Fund operating deficit of approximately $5.95m. At the time the budget was prepared, it was based on the best information available, including budget assumptions developed in February 2026.  

During the public exhibition period, the financial impacts of the emerging global fuel supply issue became clearer, and Council updated its budget assumptions to reflect the best available information before adopting the Budget. This included revised fuel, materials and other supplier costs, increasing the forecast operating deficit to $12.54m.  

The adopted budget includes updated fuel costs and other known cost increase identified before adoption. These changes increase the General Fund operating deficit from $5.95m to $12.54m in the adopted budget.  

During the public exhibition period, Council reviewed updated information on fuel prices, materials and other supplier costs as it became available. This resulted in an additional $1.38m in fuel costs and materials costs of $1.6m being incorporated into the General Fund budget, along with other known supplier cost increases identified before adoption. 

These changes were considered through Council’s budget review process before the budget was adopted. 

Council is developing a range of long-term financial strategies to improve its operating position and ensure services remain financially sustainable.  

Many of Council's income sources are fixed or regulated, while operating costs continue to increase. The LTFP, scheduled for public release in September 2026, will model a range of scenarios to improve Council’s long-term financial sustainability. 

These scenarios may include identifying efficiencies, reviewing service levels, considering future revenue options and prioritising investment to support a financially sustainable future.   

Council has reported against these on page 93 of the Delivery Program and Operational Plan 2026/27 and is forecast to meet most of the Office of Local Government (OLG) operating performance benchmarks. The exception is the General Fund Operating Performance Ratio, which is not forecast to meet the benchmark due to the current operating result deficit, where operating expenditure exceeds operating income. This reflects an ongoing gap between the cost of delivering Council services and the income available to fund them. Council will not meet this benchmark without increasing its operating income.   

The OLG performance benchmarks are a standard set of financial indicators used by councils across NSW to assess financial performance and sustainability. Results for 2025/26 will be available when the audited financial statements are released in November 2026.  

Council has not yet confirmed a single timeframe for returning to a positive operating result. This will be considered through the LTFP, which will model a range of financial scenarios over the next 10 years.  

The LTFP, schedule for public exhibition later in the year, will consider a range of scenarios to improve Council’s long-term financial sustainability. Some scenarios may demonstrate a return to a positive operating result within the plan, while others may require different combinations of expenditure management, service planning and revenue options. 

The modelling will help Council and the community understand the long-term financial implications of different approaches before decisions are made.   

The improvement in Council’s operating position is primarily driven by ongoing structural improvements rather than one-off items.  

One-off transactions such as land sales and reserve release do not form part of Council’s operating result. While they can improve cash balances or reduce borrowing costs, they do not directly improve the operating position. $3.1m of gains on disposal of assets has been included in Council’s income statement. Land sales contribute to part of this gain. 

The operating improvement is supported by a range of recurring initiatives, including:  

The budget also includes approximately $3.3m in first year profits from the MRF and around $8.1m in interest income, which includes income from both restricted and unrestricted funds.  

These savings and revenue improvements are detailed throughout the DPOP and support Council’s longer-term financial sustainability.  

Many of the improvements included in the 2026/27 budget are expected to continue in future years, supporting Council’s longer-term financial sustainability.  

These include:  

Some items, such as land sales, are one-off transactions. While additional land sales may occur as part of Council’s long-term property strategy, they are not relied upon as recurring operating improvements.  

The forecast profitability of the MRF is based on a range of operational and market assumptions (such as the prices received for recycled materials and demand for those materials), including:  

These assumptions are reviewed as part of Council’s ongoing financial planning and will continue to be monitored as the facility operates.  

Some detailed commercial assumptions are confidential, as releasing them could affect Council’s ability to negotiate effectively in a competitive market.  

Council’s financial performance will continue to be reported through its annual financial statements, quarterly budget reviews and internal monthly monitoring, which explain the key factors affecting the operating result each year.  

Where one-off items or unusual events have a significant impact on Council’s finances, these will be identified and explained to help provide context for the reported result.  

Long-Term financial sustainability is assessed over time through Council’s LTFP, which considers ongoing revenue, expenditure and financial trends rather than the results of a single year.  

The projected General Fund Operating Performance Ratio over the forward period will be included in the updated LTFP, which is scheduled to be presented to Council in October 2026.  

The LTFP provides a 10-year outlook of Council’s financial sustainability, including key financial performance indicators and the assumptions that underpin those forecasts.  

The forecast is based on expected operational income and costs using current information about customer demand, commodity prices (the prices received for recyclable materials), processing volumes and operating expenses.  

The forecast assumes the Material Recovery Facility (MRF) will secure at least one external customer and is based on recent commodity prices together with estimated processing volumes and operating costs. 

As with any commercial operation, the forecast will be influenced by changes in customer demand, commodity markets and operating costs over time.  

The forecast is sensitive to changes in fuel prices, commodity markets (the prices received for recyclable materials), and operating costs. These factors may increase or decrease the facility's financial performance over time.  

Higher fuel prices may increase transport costs, but they may also make Nowra MRF a more attractive option for neighbouring councils if it reduces travel distances. Similarly, changes in commodity prices and operating costs can affect the facility's financial performance in either direction. 

These factors will continue to be monitored as part of Council’s ongoing financial management. 

If the MRF generates a lower-than-forecast return, the main impact will be a smaller contribution to Council’s waste reserve.  

As the MRF is a new commercial operation, its financial performance will continue to be monitored as it becomes established. The forecast surplus has not been allocated to fund additional expenditure and is intended to strengthen Council’s waste reserve. 

If returns are lower than forecast, the waste reserve will increase by less than expected, rather than creating an immediate funding shortfall for planned expenditure.  

The budget does not include a specific contingency for lower-than-forecast commercial returns. If returns are lower than expected, Council’s forecast cash surplus would reduce accordingly.  

As part of the budget process, Council undertook a line-by-line review of operating budgets and reduced contingencies across the organisation. While no specific contingency has been set aside for lower commercial returns, Council’s overall financial position, including forecast cash reserves, provides flexibility to respond if actual returns differ from forecast. 

Financial performance will continue to be monitored and reported throughout the year.  

Capital carryforwards are projects that have been rescheduled into the following year. Some are planned because projects are delivered over multiple years, while others occur when project timelines change.  

The projects included in the capital carryforward are listed in Council’s Quarter 2 Budget Review (QBR2), with additional carryforwards identified through the Quarter 3 Budget Review and incorporated into the adopted budget. Carry-forwards can occur for a range of reasons, including projects being delivered over multiple years, changes to approvals, procurement processes, contractor availability, resourcing constraints or weather impacts. 

Carrying funds forward ensure the budget remains available to complete the project and is a normal part of financial and project management. The full list of carried-forward projects is detailed in Council’s Quarter 2 Budget Review (QBR2) report  

Council has strengthened its project planning and delivery processes to improve the successful delivery of the 2026/27 capital program.  

Council’s Enterprise Project Management Office (EPMO) and Project Delivery team has continued to improve how projects are planned, scoped, budgeted and monitored from the outset by implementation of the project management framework. 

These improvements are designed to support more realistic project planning, reduce delays where possible and improve the delivery of Council’s capital works program.  

Based on current information, Council has the workforce, contractor availability and resources to deliver the 2026/27 capital program.  

Council is not aware of any significant constraints that would prevent delivery of the 2026/27 program. Progress will continue to be monitored throughout the year and reported through Council’s existing reporting processes, helping keep the community informed about the delivery of the capital program and any significant changes.   

There are no significant unresolved delivery risks at this time. Council continues to monitor project delivery throughout the year and reports progress through its regular reporting processes. 

If significant delivery risks or changes emerge, Council will communicate these with the community and respond as appropriate.  

Council also continues to monitor and manage external and unforeseen ricks, such as natural disasters, economic conditions or other events outside Council’s control that may affect the delivery of planned projects and services.