A report has found that Cootamundra-Gundagai Regional Council has overspent since its amalgamation in 2016. Photo: Joshua Hoehne.
An independent report has found that Cootamundra-Gundagai Regional Council (CGRC) has exceeded its budget by $15.8 million.
CGRC commissioned the independent review of the council’s financial performance and received 17 recommendations to improve and manage its budget.
Some of the recommendations included a review of the 2022/23 operating budget, establishing an appropriate project management framework and introducing a training program for councillors on basic financial management.
The report found since the Cootamundra and Gundagai councils merged in 2016, CGRC’s inability to achieve budget expectations has significantly impacted available funding for future capital works and reserves.
Finch Consulting’s Bob Finch addressed the council at last week’s meeting (26 July) and reviewed the report and some of his recommendations.
He said budget monitoring within the organisation at the manager level has not been up to scratch, but there was a lot of room for improvement.
Mr Finch said the council’s “long-term financial sustainability is not there” unless it could push towards getting a budget surplus in its general fund.
Mr Finch also said the council’s debt service cover ratio meant its borrowing capacity was “quite reasonable” compared to many other councils with higher debt levels.
In the end, Mr Finch told the council he was confident in their prospects moving forward given the councillors were aware of the issues.
CGRC Mayor Charlie Sheahan issued a statement reassuring residents that the “council has not lost any money”.
“Our problem has been spending too much, which has put pressure on our financial resources and future sustainability,” Cr Sheahan said.
“Over the past five years, the council has provided great outcomes for the community, with new parks, play equipment, splash park, pump tracks, upgrades to Cootamundra and Gundagai main streets, new footpaths, kerb and gutter replacement and street pavements.
“Many of our village halls have been renovated, sewer and water mains replaced and renewed, and we have built a new sewage treatment plant in Gundagai.”
Mayor Sheahan welcomed the report. He said it was easy to understand and provided a platform for moving forward with addressing the long-term problem of managing budget restraint.
His statement outlined that of the $83 million worth of projects on the books, $38 million had been completed and $45 million was in progress or still to be undertaken.
“This is a huge achievement by our staff who have worked very hard to bring about the wonderful results we see around us every day; I can’t congratulate them enough.
Cr Sheahan acknowledged the council had a poor record in the past five years in budget management and depleted its cash reserves.
He said that moving forward, the council would have to manage the budget as the report recommended at a modest surplus of $2 to $3 million a year.
Mayor Sheahan said the council was dealing with the current situation and had already implemented many of the recommendations from Finch Consulting’s report.
“As your Mayor, I want to reassure you all that council is addressing the problems of the past administration and working very hard to improve our overall operation and pursue greater efficiency and a more positive outcome for the future,” he said.
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