Review recommends rate rise
RATEPAYERS in Stanthorpe are paying an average of $400 less a year than their Warwick counterparts, a new State Government report has revealed.
Released just a fortnight before the new council budget is due to be brought down on July 7, the Southern Downs Regional Council 2010 Credit Review by the Queensland Treasury Corporation (QTC) rates our council’s overall financial position as “weak to developing”, with operating deficits forecast until 2014.
The QTC has warned the council it needs to shelve ambitious plans like a new convention centre for Warwick until it is “on a far more sustainable financial footing” and also recommends selling off key real estate assets to bring in anything up to $9 million in cash.
The Southern Downs Regional Council (SDRC) was one of just seven councils in the state put through the wringer by the QTC this year and the only non-metropolitan council.
Despite its criticisms, the QTC has approved new borrowings by the SDRC of $348,000 for the new financial year for its capital works program, noting the council should be able to maintain and service its “existing and future” debt, with $16.9m forecast to be required between 2011 and 2013.
Council chief executive officer Rod Ferguson yesterday said the SDRC welcomed the review, which he said was “really a sustainability review” to assess council’s ability to meet its financial commitments over the next decade.
“Southern Downs was one of only seven councils selected for review and the only one that was not a major urban council,” he said.
“The outcome reflected the growing acceptance that the smaller regional councils are struggling to meet community demands following amalgamation.
“The ‘developing’ outlook rating reflects that council will need to keep tight control over all forms of expenditure but, if it does this effectively, it has a heightened opportunity for returning to financial surplus much earlier than predicted.
“It also reflects that council will not continue to be sustainable unless rates are increased above the level forecast in the financial model we provided to QTC, which was six per cent at the time of the report.”
Mayor Ron Bellingham said it was a very important report which showed that with strong commitment from council and continued good management, council could continue to service the community to present standards, but there was a clear call to lift the revenue raised through rating.
“This is an independent body reviewing council’s financial standing and, while it would have been pleasing to be in a better position, I believe that will be achieved in the not too distant future,” Cr Bellingham said.
Current Southern Downs region population of around 35,000 forecast to grow to 48,000 by 2031
Average age 40 (State average 36), forecast to be 48 by 2031
Overall rates are low and should be similar to Brisbane, Ipswich, Toowoomba and Dalby – possibly higher due to lack of economies of scale and highly developed CBDs
Stanthorpe ratepayers pay on average $400 less a year than Warwick ratepayers – this must be addressed by council as the cost of service delivery may be higher in Stanthorpe
Capital spending needs to be contained to current levels – no ambitious new projects
Assets which should be sold include the Willi Street depot, the Applethorpe TAFE, the car park next to the Daily News on Albion Street and Slade Campus – up to $9m could be realised
See the full report at www.southerndowns.qld.gov.au