Planning for a sustainable future

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Council is facing significant financial challenges in the immediate and long term if we are going to meet the community expectations on service delivery and maintain or improve major assets like roads, bridges and community facilities.

Currently, there is an annual shortfall of $25 million to $35 million for Council to continue to provide maintenance and services across the City and restore reserves which will enable us to respond in an emergency event.

We will be taking a number of actions to sustain and improve operations and increase revenue and efficiencies to close the gap on income and expenses. This includes the preparation of an updated Resourcing Strategy which is on public exhibition.

What has caused the financial issues?

Many factors have contributed to making Council’s financial position unsustainable.

  • The impacts of consecutive natural disasters and the COVID pandemic during the last five years has significantly depleted revenue and increased operational costs. The net cost of the disasters, including subsidies and waivers on fees and charges, reduced the unrestricted cash position by $14.6 million.
  • Rising cost of materials, labour and contractors.
  • Increased expense of interest rates to loan borrowings.
  • Sustained lower than average residential and business rates.
  • Rate Pegging – the NSW Government restricts how much councils can typically increase rates by, and in recent years rate rises haven’t kept up with inflation.
  • Millions in grant funded improvements post fires and floods means we need to put more away each year to save for maintenance and renewal – depreciation costs.
  • Community expectations are that maintenance and replacement of assets like roads, bridges and community facilities should be improved on current levels, requiring greater investment.
  • Cost shifting by state and federal government forcing council to assume responsibility for infrastructure, services and regulatory functions without providing sufficient supporting funding.

How can we fix this?

There’s a range of initiatives that Council can implement to generate more income and improve operations to ensure we are sustainable in the long term.

We’ve also updated our suite of Resourcing Strategy documents which are now on public exhibition.

To increase revenue, options for a Special Rate Variation are being considered as well as a review of fees and charges and sale of assets.

As an organisation, Council is embarking on productivity and efficiency improvements over the short and long term. These include strategic planning improvements, strategic asset management planning, service level reviews and additional governance and financial controls.


What is a Special Rate Variation (SRV)?

Since 1977 Council rate revenue and certain other Council revenues have been regulated in NSW under an arrangement known as 'rate pegging'. Each year the NSW Government, through its rate-pegging policy, determines the percentage figure that councils can increase their general rate income. If councils want to apply for a larger increase they need to make a Special Rate Variation application.

What’s the rate increase being proposed?

There are two options being considered that would achieve financial sustainability over varying timeframes and then remain as the rating level. The increase would only apply to the General Fund (property rate) on your rates notice, and not the total bill amount.

What options are Council considering?

The application would be for a permanent increase of the amount reached in the first year of Option 1, or at the end of the third year in Option 2. Basically, once the SRV amount is reached, the rates will increase by the rate peg on top of the SRV increase each year after that.

The Special Rates Variation Fact Sheet provides a breakdown of the total impact for Farmland, Business and Residential rates.

What will Council be doing to reduce costs?

The organisation is implementing a number of initiatives to meet a minimum target of $3 million in efficiency savings during the next four years. These include:

  • Implementing asset management improvements identified in the Financial Sustainability Review including the establishment of a project management office and project management framework.
  • Strategically review and update asset management plans and asset condition data, commencing with road assets in early 2024.
  • Detailed service review program which will assess service levels, investigate and implement improvements to the way we deliver for our community.
  • Council will soon commence additional community engagement to obtain input on the service areas which could be reduced or increased in order to address financial sustainability.

Updated Resourcing Strategy

The Resourcing Strategy outlines how Council will manage its finance, assets and people to achieve the community's vision and goals. The updated draft components of the strategy currently on exhibition are:

  • Workforce Management Planning Strategy – planning for the workforce needed to deliver services to our community
  • Asset Management Strategy – how we manage the assets (like buildings and infrastructure) that Council owns
  • Information Communication Technology Strategy – making sure Council’s systems and technologies provide exceptional customer service
  • Long Term Financial Plan 2024-2034 - outlines how Council aims to provide services and infrastructure over the long term while ensuring financial sustainability for current and future generations
  • Council has made changes to our Resourcing Strategy based on the recommendations coming out of Financial Sustainability Review and the special rate variation scenarios. The Draft Resourcing Strategy is currently on exhibition and you can provide a submission using the TAB below.

Summary documents outline the key points of each of these documents.

Have a say

Thank you for your input. This consultation is now closed.

Council will decide in late January 2024 whether to apply to the Independent Pricing and Regulatory Tribunal (IPART) for the SRV and which option to apply for.

Next steps

A report will go to the Council meeting in late January 2024 to review the research, financial modelling and community feedback.

If Council decide to make an application for an SRV the application will be submitted in February 2024.

Council is facing significant financial challenges in the immediate and long term if we are going to meet the community expectations on service delivery and maintain or improve major assets like roads, bridges and community facilities.

Currently, there is an annual shortfall of $25 million to $35 million for Council to continue to provide maintenance and services across the City and restore reserves which will enable us to respond in an emergency event.

We will be taking a number of actions to sustain and improve operations and increase revenue and efficiencies to close the gap on income and expenses. This includes the preparation of an updated Resourcing Strategy which is on public exhibition.

What has caused the financial issues?

Many factors have contributed to making Council’s financial position unsustainable.

  • The impacts of consecutive natural disasters and the COVID pandemic during the last five years has significantly depleted revenue and increased operational costs. The net cost of the disasters, including subsidies and waivers on fees and charges, reduced the unrestricted cash position by $14.6 million.
  • Rising cost of materials, labour and contractors.
  • Increased expense of interest rates to loan borrowings.
  • Sustained lower than average residential and business rates.
  • Rate Pegging – the NSW Government restricts how much councils can typically increase rates by, and in recent years rate rises haven’t kept up with inflation.
  • Millions in grant funded improvements post fires and floods means we need to put more away each year to save for maintenance and renewal – depreciation costs.
  • Community expectations are that maintenance and replacement of assets like roads, bridges and community facilities should be improved on current levels, requiring greater investment.
  • Cost shifting by state and federal government forcing council to assume responsibility for infrastructure, services and regulatory functions without providing sufficient supporting funding.

How can we fix this?

There’s a range of initiatives that Council can implement to generate more income and improve operations to ensure we are sustainable in the long term.

We’ve also updated our suite of Resourcing Strategy documents which are now on public exhibition.

To increase revenue, options for a Special Rate Variation are being considered as well as a review of fees and charges and sale of assets.

As an organisation, Council is embarking on productivity and efficiency improvements over the short and long term. These include strategic planning improvements, strategic asset management planning, service level reviews and additional governance and financial controls.


What is a Special Rate Variation (SRV)?

Since 1977 Council rate revenue and certain other Council revenues have been regulated in NSW under an arrangement known as 'rate pegging'. Each year the NSW Government, through its rate-pegging policy, determines the percentage figure that councils can increase their general rate income. If councils want to apply for a larger increase they need to make a Special Rate Variation application.

What’s the rate increase being proposed?

There are two options being considered that would achieve financial sustainability over varying timeframes and then remain as the rating level. The increase would only apply to the General Fund (property rate) on your rates notice, and not the total bill amount.

What options are Council considering?

The application would be for a permanent increase of the amount reached in the first year of Option 1, or at the end of the third year in Option 2. Basically, once the SRV amount is reached, the rates will increase by the rate peg on top of the SRV increase each year after that.

The Special Rates Variation Fact Sheet provides a breakdown of the total impact for Farmland, Business and Residential rates.

What will Council be doing to reduce costs?

The organisation is implementing a number of initiatives to meet a minimum target of $3 million in efficiency savings during the next four years. These include:

  • Implementing asset management improvements identified in the Financial Sustainability Review including the establishment of a project management office and project management framework.
  • Strategically review and update asset management plans and asset condition data, commencing with road assets in early 2024.
  • Detailed service review program which will assess service levels, investigate and implement improvements to the way we deliver for our community.
  • Council will soon commence additional community engagement to obtain input on the service areas which could be reduced or increased in order to address financial sustainability.

Updated Resourcing Strategy

The Resourcing Strategy outlines how Council will manage its finance, assets and people to achieve the community's vision and goals. The updated draft components of the strategy currently on exhibition are:

  • Workforce Management Planning Strategy – planning for the workforce needed to deliver services to our community
  • Asset Management Strategy – how we manage the assets (like buildings and infrastructure) that Council owns
  • Information Communication Technology Strategy – making sure Council’s systems and technologies provide exceptional customer service
  • Long Term Financial Plan 2024-2034 - outlines how Council aims to provide services and infrastructure over the long term while ensuring financial sustainability for current and future generations
  • Council has made changes to our Resourcing Strategy based on the recommendations coming out of Financial Sustainability Review and the special rate variation scenarios. The Draft Resourcing Strategy is currently on exhibition and you can provide a submission using the TAB below.

Summary documents outline the key points of each of these documents.

Have a say

Thank you for your input. This consultation is now closed.

Council will decide in late January 2024 whether to apply to the Independent Pricing and Regulatory Tribunal (IPART) for the SRV and which option to apply for.

Next steps

A report will go to the Council meeting in late January 2024 to review the research, financial modelling and community feedback.

If Council decide to make an application for an SRV the application will be submitted in February 2024.

  • Council resolve to not proceed with SRV application

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    Council reconvened a meeting that had been adjourned on Monday night after four hours of discussion and debate about the recommendation to lodge an application with IPART for a proposed SRV in order to break a deadlock and advise staff of a way forward.

    The proposed SRV was one of 26 actions advised by independent financial experts, AEC to ensure the ongoing provision of works and services across the city could be sustained and that money would be readily available to respond in an emergency event. Rate rises where not an alternative to the actions contained within the report but part of returning to a more stable financial position.

    Council resolved a range of workshops to improve efficiencies, asset management planning practices and increase revenue through immediate sales of underperforming assets, fees and charges as advised by AEC and establish a financial advisory committee to maintain priority over financial sustainability.

    “We will continue to implement the actions necessary to improve efficiencies across the business and work with the Council to determine the levels of service,” said Mayor Amanda Findley.

    “We know that to reduce expenses will mean less money available to perform works and services and will impact our ability to pay for road and other maintenance,” Cr Findley said.

    “The implications of this decision will also require ongoing stringent monitoring of expenditure and the ability to make necessary adjustments to our capital works projects and maintenance programs to reduce our forecast deficit,” she said.

    “Councillors will have exercise greater financial discipline in decision making and will be unable to support any requests that attempt to add higher levels of service or infrastructure to an already burgeoning list of requests.”

    “Given the large number of assets and extensive road network that Council is responsible for, asset management and planning will be a priority moving forward and consideration will be given to the sustainability measures in the next 12 months. The need for a special rate variation does not go away with this resolution - it merely pushes the issue to the next Council to be elected in September,” she said.

    The draft Resourcing Strategy will be reviewed to include the updated financial modelling based on the 2024-25 budget process to be done early this year.

  • Survey - Service Review Program

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    CLOSED: This discussion has concluded.
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    The range and standard of services that Council delivers to the community is beyond what the current budget allows. If Council does not endorse an application for an increase to rates beyond the rate peg through a Special Rate Variation the current services will have to change.

    The form will ask you to choose 10 service areas which should be the initial focus for reducing Council services. The feedback questions will also ask you to choose the 10 service areas that are most important to you. Feedback will be included alongside Council’s satisfaction survey results and findings from the recent Liveability Census in the report to Council in January.

    Please provide your feedback by completing the Online Survey by 5pm, Wednesday 24 January 2024.

Page last updated: 31 Jan 2024, 04:13 PM