March 26, 2013
Rumours that the South Burnett Regional Council is going broke are untrue, councillors heard last week.
At the Council’s monthly meeting on Wednesday, Cr Barry Green said several people had asked him recently if the Council was going broke because of all the flood repair work it’s been doing.
The SBRC’s monthly financial statements also appeared to show Council’s cash-on-hand position had deteriorated, he said.
But SBRC Finance General Manager Gary Wall said that although one of the indicators Council routinely uses to monitor its current position had drifted into the red since last month, this was just a short-term fluctuation and Council’s underlying financial position was sound.
“Has this been caused by the shift to quarterly rates?” Cr Cheryl Dalton asked.
Mr Wall said quarterly rates were partly to blame, and last month’s decision by Council to extend the rates discount period by an extra 10 days to March 28 had also played a part.
“When we had half-yearly rates, Council had access to a bigger amount of cash at any time,” Mr Wall said.
“Quarterly rates require more cash management.”
“Is the situation manageable?” Cr Dalton asked.
“Yes,” Mr Wall replied. “It’s tight, but it’s manageable.”
Cr Green asked if the money Council has been spending on road repairs since the Australia Day floods was recoverable.
Mr Wall said outlays on all emergent works (ie emergency flood repair works) were fully recoverable.
In addition the Queensland Reconstruction Authority was providing 30 per cent of estimated repair costs up front.
“This will help a lot. And it’s much better than the six-month wait the Council faced in the past,” he said.
Mr Wall added that Council carries between three and four months cash to cover normal operating expenses at any time, and also has access to an overdraft facility should it ever be needed.
“We’re not broke, just not flush either,” he said.
Cr Duff then asked if the extensive overtime many Council staff have been doing since the floods was fully funded.
Mr Wall said it was, and Infrastructure General Manager John Kersnovski added that overtime was one wages component that was beyond doubt.
Mr Kersnovski said the SBRC did not get funded for ordinary staff hours because if the floods hadn’t happened, staff would have been engaged on routine tasks and Council would be paying them to do that work.
But all hours above ordinary hours were fully recoverable.
- Related article: Council Extends Rates Discount
