2020-21 Budget FAQ

Published on 28 May 2020

What is the biggest issue in the draft budget?

The biggest issue in the 20-21 draft Budget and Long Term Financial Plan is whether or not Council should access the NSW Government's $395 million Stimulus Package for Local Government.

What would accessing the Stimulus Package involve?

The package allows Councils affected by the COVID-19 (Coronavirus) to access a $10 million loan from the Government at a fixed interest rate of 1.8% over 10 years to help them recover from the affects from the pandemic.

But didn't we already take out a $10 million loan? What happened to that?

The previous loan of $10M was sought to supplement infrastructure renewal works around the City over a 10 year period. This is still being utilised annually to increase the rate of renewal to assist in the infrastructure backlog.

How much money has Council lost due to the Coronavirus pandemic so far?

Like all organisations, Council has been hit hard by the pandemic and lost approximately $2.3 million this financial year due to the virus. Most of the losses are related to reduced income at the airport and other Council facilities and impacts to Council's investments. Although it is difficult to estimate the future financial impact of the virus, Council is expecting further losses of around $2 million in the coming financial year.

Do the Councillors want to access the Stimulus Package?

Council have given in-principle support to the idea and voted in favour of putting the draft Budget and Long Term Financial Plan on public display for submissions. After the submission period they will meet again in June to discuss whether to adopt the plans or make changes.

If we access the Stimulus Package, what will the $10 million be spent on?

The money will be used on major projects, and to ensure we continue to maintain or upgrade the city's infrastructure faster than it deteriorates. The money will also be used as seed funding to attract Government grants for major project. Some of the major projects include an upgrade of Queen Elizabeth park to incorporate the Picnic Train, a redevelopment of the O'Neil Sporting Complex, and a redevelopment of the CBD to include lighting and banner poles, more trees and greenery, and spaces for pop-up businesses.

Why are those projects so important?

Apart from providing a raft of important upgrades for the city, they will also help stimulate our economy in the aftermath of the Coronavirus pandemic. If Council can spend money on major projects and infrastructure, it means more money being circulated in our community to help businesses recover.

Would we be able to pay the $10 million back?

Yes. The loan meets all the criteria set out in Council’s Loan Borrowing Policy and meets all key financial indicators to ensure that borrowings are financially sustainable for Council. The loan will also be subject to independent verification from NSW TCorp.

What if we don't access the Stimulus Package?

If Councillors vote against utilising the $10 million on offer, Council will have to reduce services to the community and drastically reduce its capital works, which will in turn result in job cuts. Council will remain in deficit until at least 2025, and will be very vulnerable should a second wave of Coronavirus or some other major event affect the city.

Enough about the Stimulus Package, what about rates?

Council raised rates in line with the 2.6% rate peg set by IPART which will result in an overall increase in rate revenue of $400,000.

Did you shift mine rates onto residents again?

No. Council again declined to continue with the previous strategy of shifting mine rates onto residents, providing residential rates respite of around $160,000.

Where can I read all the details on the Budget and Long Term Financial Plan?

Council's draft Budget and Long Term Financial Plans can be found on pages 61 and 164 of this month's business papers respectively.

How can I have my say?

You can lodge a submission on Council's Budget and Long Term Financial Plans here.