Shire budget in black hole

Glenn CordingleyBroome Advertiser

The Shire of Broome is desperately grappling to reduce a potential $8 million budget deficit while trying to control inevitable rises in rates.

Shire president Graeme Campbell warned capital and community projects would be axed or delayed and operational costs slashed as part of belt-tightening in the 2013-14 financial year.

He blamed part of the black hole on the “hundreds of man hours” spent on reports relating to the James Price Point gas hub near Broome, which Woodside has dropped.

“We received $50,000 from the State Government to do a capacity audit, which subsequently proved we would be severely stretched,” he said.

“We approached the Government for more staff or funds to deal with the proposal but that was refused. “As a consequence we incurred significant costs relating to JPP.”

Mr Campbell said several staff who have recently left would not be replaced but was “confident” there would be no redundancies.

However, he said some requests for additional employees would not be approved. Mr Campbell said rates would need to increase by more than 40 per cent to cover the $8 million preliminary budget wish list submitted by all departmental heads.

“You can see that to raise that sort of money is impractical and we won’t be going down that path,” he said. “To cull the $8 million there will be some operational expenses cut, there will be some capital expenses in plant and equipment that won’t happen, surplus equipment not getting proper utilisation will go, and there will be a series of capital and community projects that won’t occur or will be delayed.”

“There have been several resignations or retirement of staff in the past three or four months and it is very likely these people will not be replaced. As a responsible local government, we feel that is the way to go.”

“We are hopeful this will not affect the service levels that the community has come to enjoy and that our direction in recognising austerity will be accepted.”

Mr Campbell was sympathetic but said it was important to keep a lid on rates, which have more than doubled over the past decade. “At this stage we have not set our final budget and I am not able to suggest the increase in rates other than they will be well under 10 per cent,” he said.

Mr Campbell said the council was under continued pressure to meet demands for more facilities as the population continued to grow. “The bigger you get the more projects you have,” he said.

“The more houses you have, the more reserves and footpaths and roads have to be maintained or implemented.”

Mr Campbell said low interest rates had also impacted on revenue. “Interest on our reserves is down $500,000 because of the drop in rates,” he said. “That is a 4 per cent increase in rates alone to cover that — or cut a project.

“People have to realise we don’t have this huge bucket of money we can dip into at any time to fit any project or any whim of councillors or the community.We are an operating business, just like anyone else.”

“We pay water, we pay electricity, we pay wages, and superannuation has just gone on a quarter of a per cent. The hard thing is picking which projects to cut — we have to be very strategic.”

Mr Campbell said some of the $8 million would be balanced out by reducing the amount put into reserves.

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