May 10, 2021
Former mayor Keith Campbell has quizzed current mayor Brett Otto over the South Burnett’s finances and the recent decision not to call in outside consultants to cast “fresh eyes” over Council’s balance sheet.
Speaking to southburnett.com.au, Mr Campbell queried the apparent Budget operational blowout of $1.05 million, saying Council and ratepayers could not afford “a Santa Claus” mayor and councillors.
Mr Campbell – who served a total of 21 years on the Kingaroy and South Burnett councils before he was defeated by Mayor Otto at the 2020 election – also slammed last year’s zero per cent rate rise which Mayor Otto had labelled as “historic”.
He said the only history being made was the deficit.
And he warned that unless hard decisions were made about assets, the South Burnett was going to be “financially challenged” for much longer than Mayor Otto’s 2023-24 target to get Council back into the black.
In a letter to Mayor Otto – copied to southburnett.com.au – Mr Campbell emphasised he was speaking only as a ratepayer but he had a number of questions he would like answered.
He said Mayor Otto had predicted a $3.6 million deficit in his Budget speech; this was now reportedly $4.65 million, blamed on an increase in depreciation.
“Given that the depreciation allowance should have been correct when the 2020-21 Budget was put together, could you provide details of what constitutes the Budget operational cost overspend of $1.05 million?” Mr Campbell asked.
Mr Campbell alleged Council had taken “an easy path” with its zero increase in general rates last year “to win favour with some loud voices”.
“I accept that even if there had been a 2 per cent rate increase, it would not have cleared the deficit, however, Council was in no position to give a free run of a zero per cent rise and then claim to ‘make history for the South Burnett Regional Council’,” he said.
Mr Campbell said “a series of financial reviews” had been promised to balance Council’s financial position against economic conditions:
- A comprehensive study into rating categories to create improved equity in Council rates;
- An independent audit of the roads and building assets valuation reports;
- Further review of asset management plans as to priorities for buildings and parks and gardens;
- A detailed review of Council’s motor vehicle fleet; and if necessary …
- A mid-year review of 2020/21 rates and charges in response to COVID-19.
He asked whether these had occurred.
“Given that this dismal state of the Budget hasn’t just happened and that it’s been in the making for the past 10 months, was there a mid-year review of any rates and charges to assist in bridging the size of this deficit?” he asked.
Mr Campbell said there were only two options available to Council to cut the deficit: reduce services substantially; or increase rates and charges substantially.
He said there was a tendency for the current Council to backtrack when “hard decisions” were required “particularly if there is negative social media commentary”.
“Can I ask, what solution/s are you and the elected officials putting on the table for us to consider?” he said.
Mr Campbell said Mayor Otto had promised improved service standards; enhanced facilities for youth, families, the disabled and the elderly; and an environment that encouraged investment, promoted economic prosperity, population growth, and supported “sustainable development of all communities across our rural towns and villages, irrespective of size or location”.
“These appear to be ‘uncosted’ promises far outside the realm and financial capacity of ratepayers to bear the increased costs of,” Mr Campbell said.
“The reality is the region has insufficient ratepayers to accommodate the expectations that I often hear you and some of your councillors speak of. The North Burnett Council is living with this pain right now. I genuinely feel for them, both Council and the residents, who unless there is a financial handout face years of below-average basic services.”
Mr Campbell told southburnett.com.au it was possible for Council’s Budget to be brought back into surplus but ratepayers would have to accept either higher rates or lower their expectations.
He said the duplication of assets across the South Burnett was contrary to what former-Premier Peter Beattie had aimed to achieve with Council amalgamations.
In fact, Mr Campbell said he believed parochialism – and every town or village wanting the same as other towns and villages – had actually increased since amalgamation.
He called on ratepayers to lower their expectations and “work with Council” to lower the deficit and bring the Budget back into surplus.
And he urged Council to join with other Local Governments to lobby hard with the Federal Government for a greater percentage share of Financial Assistance Grants (FAGs).
Mr Campbell said Council was “over-capitalised” with duplicated assets.
These duplicated assets – increasing in value due to upgrades and the rise in property prices – were increasing depreciation costs.
“Ratepayers have to modify their expectations about what they want from this Council,” he said.
“I make this genuine call to the ratepayers in this region. Wake up! Help the Mayor and councillors through this difficult time.
“We need to sell assets to reduce depreciation costs.
“Our balance sheet is way too heavy with assets that we can’t afford.
“If depreciation is the monster, assets are the monster’s food.”
Mr Campbell gave as an example the Coolabunia Saleyards which he said could have been sold, and removed from Council’s asset register.
Council’s decision not to accept a tender after public criticism of the sale meant another million dollars would be spent by Council to upgrade a facility that may not become financially viable, but would add to Council’s ongoing depreciation costs.
In his letter to Mayor Otto, Mr Campbell emphasised the need to diminish the rate of depreciation.
“(Unless you) dispose of Council-owned assets; find other ways to provide services across the region; close down some of the costly assets that are replicated in just about every town across the South Burnett, spend less on roads (I know that about 50 per cent of rate money collected is spent on roads), the South Burnett is going to be financially challenged for much longer than the projected 2023-24 financial year period,” he said.
“The only two methods that I’m aware of in my years of local government are (1) to reduce costs and subsequently lower ratepayer expectations or (2) increase rates and wear the censure of angry ratepayers. I hope you and your Council are up for this?”
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I would like to make several points about this article.
(a) If Mr Campbell was expressing his opinion as a ratepayer, he will be extremely lucky to receive a reply from Council.
(b) Council’s financial problems have been ongoing since before amalgamation, not just since the 2020 election. Mr Campbell should be aware of this.
(c) If Council wishes to reduce operating costs, performance monitoring of staff would be good place to start. The fact that Council has twice as many admin. staff as field workers raises some concern. And all of Council’s rate revenue goes towards staff wages, all works and operational expenditure must be sourced from State and Federal hand-outs.
(d) There needs to be a very serious review of all Council’s operations involving all community members. We simply cannot continue to fund the ongoing costs of all of Council’s current operations and infrastructure.
Here’s a simple idea: leave all our small towns and villages alone (eg: Maidenwell, Kumbia, Durong, Proston etc) because they have few enough facilities as it is, but hold public meetings in the five major towns (Murgon, Wondai, Kingaroy, Nanango and Blackbutt) and ask residents to pick *one* thing Council can bulldoze (eg: swimming pool, library, hall, Customer Service Centre etc).
Keith Campbell is correct when he says Council now has more assets than it can afford and he’s also correct to say a lot of this is due to the unnecessary asset duplication it inherited when it was formed. But now that we’re 13 years down the road, the time has come for Councillors to finally bite the bullet, show a bit of courage and slim down the asset register.
Given the choice between a future of big rate rises or negligible ones, I think most ratepayers would be willing to sacrifice just one public asset in their town. Especially if it’s one that the majority of residents don’t use anyway.
Well, Mr Campbell was never shy in putting our rates up. I would be interested in how much he jacked them up during his terms on council.
There is a huge amount of administration staff and highly paid managers and then consultants being paid huge amounts to do what those managers should be able to do. I believe the current mayor did find savings and kept the general rate down in the last budget.
What the Councillors need to remember is that the majority of the community voted for change and they voted for a mayor with a financial background and they need to realise they should be supporting him rather than trying to point score.
We as ratepayers want value for money, so you need to start working to give it. The councillors were keen to spend outrageous amounts on the Kingaroy Town upgrade and increased it against the advice of the Accountant Mayor.
This from the man who was the Mayor who presided over our ever increasing debt. He either needs to own up to his own failings and his part in council’s current problems or pull his head in.
So well said Jane.
I was surprised and appalled to read what former mayor Keith Campbell stated in the above article.
Firstly, Mr Campbell has shown disrespect for current mayor Brett Otto, who has always treated his predecessor with the utmost respect and courtesy.
Secondly, Keith Campbell shouldn’t be venting his views on how the Council should be managing its operations. Nor is it his place to dictate to the ratepayers how they should react to same.
Finally, Mayor Otto kindly offered the voluntary role of KTP Ambassador to Keith Campbell, which he accepted, a privilege I feel many would have welcomed gratefully.
I think Mr Campbell raises some valid concerns that ratepayers should be asking ahead of potential decisions our elected representatives may (or may) not make in managing a complex financial situation. The regular backtracking makes this ratepayer nervous, even after a year of settling in.
It is a positive for the region and humanity that Mr Campbell “isn’t silenced” by a token role with KTP, and one that he was offered after the sod turning event he wasn’t invited to!
I’m sure Mayor Otto is sufficiently capable of responding to Mr Campbell and other ratepayers with facts about these concerns.
It is moments like this that reveal more important capabilities like leadership and whether the proposed path the Mayor talks of will still have support when services are reduced and the inevitable rate rises come our way.
Changing the curtains doesn’t fix a problem with the foundations of your house!
Campbell had a go and was not a success. Otto is trying and with a stacked deck against him it ain’t easy, but give him respect. Slash all unnecessary staff and bring back our council workers instead of contracting everything out.