Budget Approved at 2.2%

After months of work and a seemingly never ending conversation Coucnil last night approved the 2016/17 budget.

 

imagesIn recent days that conversation became quite polarised with a small number of councillors pushing for a 2.7% increase. The change in the conversation during this time alarmed me in that there was no prerequisite to raise the rate increase we had worked on all that time. Just an arbitrary and without foundation we believe it should grow by 0.5%.

 

Thankfully Coucnil showed a maturity and demonstrated leadership by approving the 2.2% rate increase which had been nominated in our public consultation. A rate increase we had no fewer than 4 outside experts confirm as a responsible rate increase and a responsible and sustainable level of debt.

With the lowest rate rise in the time I have been on council I believe we have set a responsible and sustainable budget.

It includes from those of us who live in the west of Unley’s point of view the following:

      Councils contribution to the under-grounding of power lines @ $ 300,000 of Goodwood Road

      Upgrade of Goodwood Road streetscape and way finding @ $ 3.3 m (using loan funding)

      Continuation of the implementation of the King William Road Master Plan

      An increase in funding to address issues raised thus far in our LATM study

      $ 250,000 towards preliminary works on Brownhill Creek

      Safety road works around the Goodwood Primary School

      Footpath replacements in Laught Avenue Black Forest. The remainder of footpaths in the Clarence Park ward are scheduled for 2017/18 when the program terminates.

      Tennis Court resurfacing and fence repair at Page Park.

      A catch up of CPI for our community grants scheme.

      Fruit trees in Princess Margaret Playground

      Responding to tree risk assessment in Dora Guild Playground

In signing off I note that a 2.2% increase on annual rates paid say of last year at $ 1,600.00 equates to an increase of $ 35.00. This is of course subject to whether your homes value (as determined by the Valuer General) alters at the same rate as the combination of all properties in Unley. In other words there may be some variation to this.

The minimum rate will increase by $ 17.00 to $ 758.00

 

To Cap Council Rates or not-that is the question.

As I sit down tonight and over the weekend to deliberate on the agenda of a special council meeting set for next Wednesday night that is the question I ponder. Whether there is a justification for an outside body to cap Council rates or not.

This meeting has been called outside our normal schedule of council meetings because it is that time of year again. The time when we start to consider our draft annual business plan and budget.

Goyder - Steven GriffithsThe time when media attention is focused on rate increases and curiously not annual business plans. It has come early this year with the private members bill by the Hon. Steven Griffiths on rate capping tabled in State Parliament.

We heard from politicians, from experts and the public itself.  There may be a reasonable argument for rate capping and it is appropriate that we have a discussion about it. Is the debate I ask focusing on the real issue though?

I suggest it is not so much rate increases and whether they are too great or not but the manner in which they (but more importantly) the annual business plan they represent are endorsed. The LGA have argued against a body such as ESCOSA overseeing rate increases and that the current realm of public consultation is better.

I am not convinced using ESCOSA is an economically viable approach to ensuring rates are kept in balance. Why? This adds yet another layer of bureaucracy that has to be paid for, probably via the rates. It will likely increase the cost to council too because now they will have to prepare an annual presentation to ESCOSA as well as the public. That is of course unless the bill seeks to exclude the public from the process.

Unlike assessing rate increases for power or water ESCOSA would have to assess each council’s program noting there are vast differences between councils, how they are run and the programs they provide for their own communities. To treat all councils otherwise with a generic rate increase would not recognise these differences. It may be well more than some councils need but place others in financial hardship, particularly over the long term.

Equally I question the LGA claim however that our communities are consulted. This can on the surface be challenged. In the 5 years I have been present to watch our own community consultation I have seen no more than 5 people attend the public forum we provide to allow the public to contribute. On one occasion there was only one. This is hardly public consultation and difficult I would suggest to defend.

Having said that a large portion of our annual budget will have been set by decisions made by council in the months and meetings and indeed years gone by. Many of the projects being included in the current budget will have had large public consultation prior to being endorsed for implementation and prior to them being considered in a budgetary process. So arguably there has been prior consultation albeit on a project per project basis and not with consideration of how do we pay for it or which do we give priority to.

When an annual plan is put to the public whether to one or hundreds or thousands my experience is that there is no choice, no opportunity to prioritise. This should be given some thought by the local government industry. Provide choice with evidence of how much each initiative or project affects the rates and we would then have a considered input from the public from which councillors can then make decisions rather than them have sole prerogative on the priorities.

 

New Year opens with an attack by Messenger Press on Unley

The Messenger Press has provided the City of Unley a new years greeting via the column this week by Andrew Faulkner entitled “Reading Between the Council Lines”. A column quite scathing of our accounting practices.

 

The essence of the storey is our accounts include an item of over $ 2.0 m allocated to would you believe “General”. That is a large figure we all would agree to be put under “General”.

Fair enough therefore to ask the question. And I agree that the costs allocated to this heading should surely be able to be posted more meaningfully but much in Local Government is constrained by regulation.

The storey was written however in my opinion as a means of denigrating Council and to paint us as trying to hide things we don’t want you to know about. He clearly was not happy that the skeleton staff we had when he asked for clarifications were not able …or he suggests … willing to respond.

Unlike council however who the same paper will criticize for conducting public consultations just prior to Christmas when everyone is focused on other things he expects us to be able to provide for his needs (as urgent as they obviously were) during the Christmas break.

Indeed his article was printed before most of our staff had returned from holidays. Maybe that was the urgency.

Getting to the accounts now, earlier in the week our Mayor (who read an early copy) asked Management to provide detail to the accounts. The response we have thus far is as follows:

 

The story focuses on our use of “other” expenditure and makes some broad statements about categories that cost centre covers. I wish to make the following points for Members’ information:
  • Firstly, it should be noted that our current format of the financial accounts  has been in place for over 10 years and are in accordance with accounting standards and the model set of accounts prescribed by the Regulations. The ‘Other’ classification is used to record expenditure where it does not fit anywhere else.
 
The article mentioned specifically;
  • $372k contributions. This is our payment to the LGA
  • $135k program expenses. These are for the delivery of services at our Community Centres and through Community Services (most have corresponding income)
  • $720k marketing. This includes support for our 5 Main street Associations, Council Brochures, Community Consultation on DAP’s and SAPN work undertaken last year, publications such as Unley Life, Advertising in the Messenger Press, displays at the Museum and Media monitoring
  • $254k General.  This is spread across the organisation
 
Other items in the $2.1m include:
  • Committee Sitting Fees $50k
  • Banks Fees and debt collection $130k
  • Payment to Valuer General for rates valuation data $162k
  • FBT $157k

 

Having said all that, I agree with our CEO that it is appropriate in today’s environment to provide a further breakdown of costs so that the “Other” expenses is reduced. For example, if the above expenses were categorised in specific cost centres, that would reduce the “other” by about $1.5m leaving about $600k in “other”. Having said that, I wonder how much more breakdown is needed to avoid similar accusations in the future.

Management confirm they will review this as part of the budget preparation work this year to achieve a balance between the number of cost centres created and the level of detail to provide the community with a degree of confidence.

Hoping this helps anyone who has been disturbed by Andrew’s article. If you have any misgivings and/or seek further clarifications please let me know and I will endeavor to obtain them for you.

 

 

 

Annual Business Plan goes out for Public Consultation

Yes. It is that time of year. The time when Council presents to the public it’s draft annual business plan and therefore the proposed budget. This of course informs the pending rate increase.

 

The purpose of the annual business plan is to let you know about:

  • The services provided by the City of Unley
  • Proposed new initiatives and projects, and
  • The draft budget

Council seeks to achieve a reasonable degree of rate stability over time while ensuring ratepayers are paying for those services and infrastructure maintenance obligations they require.

For more information and for a link to an electronic copy of the plan go to this link to our website.

If you care about your neighbourhood I encourage you to look at the business plan and provide your comments and observations though the mediums explained on the website.

You will see from the plan that to fund the plan we are proposing a rate increase of 4.1%.