Edward River Council explores options to improve finances

Edward River Council’s draft Long-Term Financial Plan will be finalised and adopted next month following an extensive community consultation process.

Council staff also took the draft plan on a road show to its rural communities which stretch from Booroorban in the north to Blighty in the south.

“Council recognises the diversity of difficulties within our community, and their contributions,” Chief Executive Officer, Phil Stone told the recent Booroorban meeting.

“Council’s finances are in a good position, but there are challenges that need corrective action in the medium term.”

Ratepayers were told that while Council had healthy cash reserves and profitable water, sewer and waste management services, its general fund suffers a ‘structural deficit’.

“If not corrected, the general fund will, over the long term, deplete Council’s cash balances,” an independent, comprehensive analysis of Council’s long-term financial position found.

“The general fund is projected to produce a net operating deficit of $2.88 million in 2023-24 which improves across the 10-year period to a $1.4 million in 2023,” the report reads.

“These ongoing operating losses in the general fund are using up Council’s cash reserves.

“Council needs to invest more money in renewing and replacing its assets and improve the way it manages them.”

“The additional investment needed will exacerbate the issue without budget repair,” he said.

Mr Stone said a structural deficit does not mean Council is broke and will run out of cash.

He said Council’s cash position continues to be healthy, with a forecast cash balance of $55.3 million at June 2024.

Council is considering nine strategies as part of the Financial Sustainability Review and said their success and timing would determine how long it will be for Council finances to be back in the black.

They include a Special Rate Variation to increase the rate revenue by seven per cent for six consecutive years plus a review of user-charges, creating a waste fund, improving the way Council manages its assets and looking for ways to encourage economic and population growth.

“The only commitment Council has made in relation to raising rates beyond the rate peg is to commence a conversation with the community about a Special Rate Variation in readiness for application,” Mr Stone added.