TWO Gannawarra Shire councillors have criticised rising employee costs in the proposed 2022/23 council budget, claiming councillors “are not directing the ship”.
Council approved the draft budget at the May 18 ordinary council meeting, which outlines a $13.2 million investment in capital works and an increase in revenue raised through municipal rates revenue.
Residents were able to provide feedback up to 5pm yesterday.
Council will generate $41.1 million through rates, charges and grants in the next 12 months, with a $6.7 million operating surplus predicted.
Cr Ross Stanton moved that council accept the proposed budget, saying council would “still kick it around” with a “long way to go before we bring it up again on June 29”.
“Yes, there are increased employee costs and if you want to go tell employees they can’t have a pay rise then by all means, and if you want go out there and say we are going to cut services that employees deliver, ok, we can have that discussion, but if we want to deliver what are delivering today and continue to do, then this budget meets that, it meets some great projects for our community,” he said.
Cr Garner Smith said it “saddens me to have to continually raise concerns about the aspects of the finances of Gannawarra.”
“There is something in the budget that is quite positive and that’s the capital works program and the capital works going around have been very commendable to both council and staff,” he said.
“But, we have been repeatedly told by everyone that those grants are paid by higher levels of government and that is going to come to an end – we are constantly warned that we need to prepare for that.
“We need to make sure we are monitoring our operational aspects as well, making sure it’s within a tolerable limit.”
Cr Smith said council forecast employee costs to rise by more than $7 million in the past five years.
“This budget takes employee costs up to $18.4 million. Five years ago it was only $11.5 million. This is extraordinary stuff and as mentioned, actual employee costs over-budgeted was $5.3 million more,” he said.
“The other fundamental shift is the relationship between employee costs and rates. Five years ago rates were actually $950,000 more than employee costs, but in this budget we are forecasting employee costs will be $4.2 million more than rates.
“I’m not saying that by definition is bad but we should be examining these closely. If we don’t I can see this spiralling out of control quickly.”
Employee costs are projected to reach close to $20 million in 2025/26.
Cr Smith also raised concerns about the short timeframe of two-and-a-half weeks residents had to provide feedback.
“Cr Stanton says we will review it in June, but the reality is last year we had the draft in April, but now doing this in May, which is very little time for feedback and almost no time to make substantial changes to it – we have a real problem brewing here,” he said.
However, council has discretion of how long the community has to provide feedback, with the Local Government Act 2020 failing to stipulate the minimum timeframe.
Cr Keith Link questioned “what direction council was heading in”.
“If we are so grossly over-budget for five years, what direction are we heading?” he said.
“Unfortunately, councillors are not directing the ship as to where it’s going.
“On page 46 of this report it clearly states that this report was considered at an open council meeting, which implies it’s a transparent decision of council, but then when you go down to page 79, it states total employee costs have increased by 6.67 per cent.
“Now 2 per cent of that is put down to new enterprise bargaining agreement and the rest is due to increase in the level of service under the National Disability Insurance Scheme (NDIS).
“We are going back to the NDIS. It’s a major business that council runs that we know nothing about, so I get back to what direction is the ship going? Council has no control over the direction of council.”
While additional staff have been employed to meet the increase in the level of service under the NDIS, the draft budget states this increased employee cost is offset by reimbursement income and user fees.
Cr Stanton said he took the concerns on board, referring to the movement of staff numbers inside the budget papers.
“There is increased child services of 4.6 per cent due to long day care and three-year-old kindergarten we are supplying, and the budget predicts a small profit from this service over the three years,” he said.
“Community care shows a small running loss, swimming pools another one with a full-time employee going up, swimming pools is a significant cost of $500,000 per years, so costs in there to provide the community with improved wellbeing. No doubt staff costs go up every year – you can reduce staff but not reduce services.”
Crs Stanton, Charlie Gillingham, Jane Ogden and Travis Collier voted in favour of the motion, with Crs Smith, Link and Kelvin Burt abstaining.
