Kiama Council’s General Manager, Kerry McMurray, is expecting COVID-19 to have wiped around $6.4 million from its income in the 2019/20 financial year.
This represents 10-15 per cent of the amount expected when the budget was approved last June.
As an example, up until ANZAC Day, the holiday parks usually generate $350,000 a week in income. They are now closed.
In addition, income lost from the Leisure Centre is expected to be close to $900,000.
“We have spent the last three or four weeks dismantling the current year’s budget and looking for savings we can use to offset the losses,” says Mr McMurray.
“We are that far through the year that a lot of the projects have commenced so they are hard to pull back.
“We are looking at what we can defer, and obviously our focus is to keep projects going that involve day labour rather than outside contractors, so our staff have work they can keep doing.”
A draft budget for the 2020/21 year is being prepared to go to the May Council Meeting.
“We are also currently looking at shifting priorities to potentially do some asset renewal, for example at the library and the leisure centre, while they are closed.
“Again that comes at a cost, and we just have to see what the councillors are prepared to defer to allow that to happen.”
Councils are yet to receive any financial support from the State or Federal Governments, despite the wide level of services they are required to maintain and the large number of people they employ.
The President of Local Government NSW, Councillor Linda Scott says the Commonwealth’s refusal to make the JobKeeper allowance available to council employees is not supportive of the role of councils in the community and calls on the State Government to do more.
“Funding councils is the solution to the nation’s recovery from COVID-19.
“But, without State Government stimulus, councils are facing an almost impossible task in the months ahead.
“We know councils have been terribly hard hit even in this early stage of the COVID-associated economic crisis: Blacktown City Council, in Sydney’s west, is already losing $1.7 million per week.
“And that’s before the rate notices go out. Some regional councils will cease to be able to operate in the coming months.
“If funded by the NSW State Government, councils can employ people to build the infrastructure for the future, and deliver the community supports needed to ensure no one is left behind during the COVID-19 pandemic.”
There has been no indication by the State Government that the Fit for the Future benchmarks will be eased at this time, leaving them in even more of a quandary.
“Part of the stripping down of the budget is to see how close we can get to the indicators in light of the losses we’ve taken,” says Mr McMurray.
“It is highly unlikely we will meet all of the indicators this year, particularly the operating performance ratio indicator, because we are going to have significant less cash over this period of time.
“We are trying to figure out where we can cut back costs but still maintain a workforce and still deliver the services the community needs.”
At this early stage, he says it could take potentially two years to recover from the fall out.
The April Meeting of Council is expected to consider a financial relief package for some ratepayers.
The Meeting will be held online, and broadcast as usual via Council’s website.
Technical arrangements have also been made for those wishing to talk at Public Access. Those people who register to speak will be sent a Zoom link to participate and make their case.