Growth makes life hard for councils
By MARY MANN
THE fast growth experienced by coastal shires is dragging down the financial sustainability of Northern Rivers councils.
A study by local government rater Fiscal Star into the sustainability of NSW councils paint a grim picture for Ballina, Lismore and Richmond Valley, with their debt, infrastructure backlog and operating deficit figures adding up to an overall mark of being financially unsustainable.
This means that, unless some policy changes are made, or the State or Federal Government comes to the rescue with funds, they risk running themselves into the ground.
The predictions for 2015 do not look much better. But there is hope if the councils play their cards right, further down the track they can become stable.
Byron Shire Council's financial situation scrubs up OK in the report but things will get worse unless some changes are made soon.
It does not look good for any of our local councils, but we are no worse off than others in the State. One in every three councils is listed as financially unsustainable in the report.
Alan Tregilgas, principal author of the report, said the poor ratings were not a mark of incompetence. It was the strong population growth experienced by coastal shires which had put excess pressure on the councils and easily led to them being financially unsustainable, he said.
"Fast growth is like a two-edged sword, it's better than no growth but it places large demands on services and infrastructure," he said.
"This means councils have to be extra smart and careful about what they do."
Professor Percy Allan, research director for Review Today, agreed and said if councils wanted to last the long haul, they needed to get serious about increasing revenue, make sure they do not over-spend, keep their assets in good condition, and focus on long-term plans.
He also recommended the councils undertake a full sustainability review.
"They need to put a plan with some options to the community and ask, 'Which is going to be the least painful way of dealing with the problem?'-" he said.
Ballina Shire Council's general manager, Paul Hickey, said the council had already started a 'Get Well' program, aimed at bringing services like roads and waterways up to scratch while increasing revenue and keeping the council's bank balance in the black.
"We realise we have a huge asset base we need to maintain to stay on top of things," Mr Hickey said.
"There is still a lot of work to do, but we are onto it."
Byron Shire mayor and the general managers of Lismore and Richmond Valley councils said their councils were also looking at rate rises and controlling expenditure to increase financial sustainability.