Kiama Council’s draft operational plan, on exhibition until 23 June, shows a budget deficit of $980,000 for the next financial year, after a COVID-19 related net loss for 2019/20 of just under $1.5 million.
“If we hadn’t reduced our operating expenses in the last quarterly budget review by $1.5 million, our loss for this financial year would have been about $3.4 million,” says Council’s General Manager, Kerry McMurray.
To keep the deficit at this level, he has had to significantly cut the amount of new capital works proposed for the coming year.
“We have $1.5 million of unfunded capital works that will potentially have to be rolled over into the next financial year,” he says.
The biggest item of these works are proposed road resealings.
In contrast, money has been allocated for asset renewal, a strategy Mayor Mark Honey approves of as it will keep the standard of community assets up to community expectations.
“There hasn’t been a significant cut on that side of the budget [$11.7 million is being allocated].
“I have to compliment the staff for running the budget the way they have.”
Mr McMurray is keen to stress that the savings have come from hundreds of cost cutting measures, rather than cutting Council’s operations.
“We will certainly be running very lean, but at this stage there will be no reduction in any of the services or programs that Council currently delivers.”
The expected loss means Council will not meet the Fit for the Future operating performance ratio, although the other ratios will be met.
“We will still be recovering from the impact of COVID-19 in next year’s budget,” he says.