Northern Beaches Council's Budget 2024-25 passes - just!
This Council Meeting went for over 5 hours, with over 2 hours of that time taken up with Councillors asking for details from Council staff about the items listed in the Budget and debating on the same. For Councillors and Council staff with full time jobs, and young children, the 11.15pm close would have meant they had worked over 18+ hours of that day. In accordance with clause 19.3 of the Code of Meeting Practice the meeting concluded at 11:15 pm. The Notices of Motion listed in the Agenda were deferred to the July 30 2024 Meeting.
Cr. Korzy put a question, that if the Council did not pass the budget, and the Council risks going into administration [as a result], what the process would be for that, and if they voted against the Budget tonight whether would there be an opportunity to renegotiate elements of the Budget.
CEO Scott Phillips stated that Council's adoption of an Operational Delivery Program is a core obligation of [a] Council. 'The question as to a council not adopting a Budget for the following year is one I've never faced before and is one without precedent. ... In respect to a council going into administration, ultimately in the event that a council does not meet its core obligations, and there is no resolution to that, one pathway the Minister [for Local Government] has is to put the council into administration. That would be a last resort after several other steps.'
Council's Minutes for the Budget Item records voting as:
FOR: Cr Bingham, Cr Grattan, Cr Walton, Cr Menano-Pires, Cr Robins, Cr Ryburn and Cr Heins
AGAINST: Cr Glanville, Cr Regan, Cr Sprott, Cr De Luca, Cr Page, Cr Gencher and Cr Korzy
Councils' press release on the passing of the Budget lists 'highlights' which include:
- $18.1m for new community facilities including Warriewood Valley community centre ($15.9m) and Warringah Recreation Centre ($1.5m)
- $17.0m for improving road assets and resurfacing 4.8km of roads ($7.1m)$10.1m towards priority stormwater management works to reduce flooding and pollution
- $5.5m on shared paths including the pedestrian and cyclist bridge at Queenscliff ($2m)
- $4.3m for new and improved footpaths across 14 suburbs including Queenscliff Headland access ramp
- $3.8m improving foreshores at various locations, including implementation of the Freshwater Beach masterplan ($1.5m)
- $3.8m on new and improved reserves and playgrounds including Frenchs Forest precinct park upgrade ($2.0m)
- $3.2m improving sports fields and new recreation facilities
- $3.0m improving recreational trails, including a new Manly Dam boardwalk ($2.5m)
- $2.4m for work on Taylors Point and design of Greater Mackerel Beach and Currawong wharves
- $1.1m improving public amenities at Freshwater Beach and West Esplanade, Manly
- $1.0m on town centre and village upgrades
However, some of these costings have been announced in previous budgets and have already been listed as works paid for under grants in prior years - leading residents and community groups to ask 'where was the money gone?'.
One instance is the hundreds of thousands allocated for Pittwater projects under the Boating Now Program Round 3, announced in July 2020. The State Government provided funds for Bilarong Reserve Boat Ramp Improvements, Narrabeen Lagoon ($60,000), Church Point Commuter Wharf Feasibility Study ($40,250), Currawong Wharf Investigation and Detailed Design ($82,500), Mackerel Beach Wharf Investigation and Detailed Design ($70,657).
However, as Council's announcement states '$2.4m for work on Taylors Point and design of Greater Mackerel Beach and Currawong wharves', an extension for the funding may have been sought, and granted, as the original documents from the state government state:
'It is expected that successful applicants will commence projects within six months of signing the Funding Deed and that projects will need to be delivered by 30 June 2022.'
The lapse between a State Government announcing a grant and the funds being forwarded to a council has been cited as a reason for these recurring 'announce it again' statements. However, the June 2024 incident of the Minns Labor Government ordering Hornsby Shire Council to repay $36 million that was provided under the Stronger Communities Fund, a fund that the Auditor General of NSW has described as “deficient” and “lacking integrity”, illustrates that funds allocated for projects disappear into councils. Hornsby Shire Council applied for, and was granted, a SRV in June 2023. Since then, that Council states it has incurred 'a number of unexpected cost increases that are broadly attributable to a continuation of the high inflationary environment for longer than economists at the time predicted.
'A revised 2024/25 to 2033/34 Long Term Financial Plan has now been prepared that includes income and expenditure that aligns with Council’s original application for the SRV, as well providing for the additional cost increases incurred. The revised draft LTFP demonstrates that the SRV will continue to rebalance Council’s projected finances over the term of the Plan with surpluses forecasted each year from 2024/25, whilst noting the need for improvement initiatives to increase financial capacity back to the level forecast in the previous version of the Plan.'
As part of this fund, in 2018, the former NSW State government awarded a $40 million grant in Round 2 of the Stronger Communities Fund for Hornsby Shire Council’s Westleigh Park project. Since then, there have been significant delays in the delivery of the project and limited progress has been demonstrated, with most of the grant money yet to be spent.
The NSW Government has therefore refused a request from Hornsby Council for an extension of time to utilise the unspent funds. The Council will be required to pay back all unspent funds from the original $40 million grant, estimated to be more $36 million based on the latest report from that Council.
This decision is based on recommendations from an independent inter-agency panel that assessed all council applications for variations to projects funded through the Liberal-Nationals Stronger Communities Fund, the NSW Government stated on June 10.
''The Office of Local Government received 16 applications for variations from 10 councils. Of these, 12 have been approved. These councils asking for extensions of time have demonstrated that their projects are on-track.'' the statement says
The Palm Beach Whale Beach Association is wondering where grants allocated under the Crown Lands Improvement Fund for Governor Phillip Park have gone to. These projects need to be completed within 12 months of receiving the funding.
The State Government, just prior to going into the caretaker period for the March 2023 NSW State Election, announced the Crown Land 2022-23 funding round outcomes with grants totalling $378,072.00, all of them focussed on controlling weeds, had been allocated to the Northern Beaches Council.
That allocated to Pittwater included:
Governor Phillip Park (Part)
Control of weeds to maintain natural areas of Governor Phillip Reserve, Palm Beach.
Grant allocation: $133,100
Hitchcock Park Foreshores
Control of invasive weeds at the Hitchcock Park Foreshore.
Grant allocation: $27,000
Beeby Park
Control of weeds at Beeby Park, Mona Vale.
Grant allocation: $12,000
Lake Park
Weed Control at Lake Park, North Narrabeen.
Grant allocation: $29,700
Wakehurst Parkway
Weed control along the Wakehurst Parkway.
Grant allocation: $24,000
Jamieson Park
Weed control at Jamieson Park, Narrabeen Lagoon.
Grant allocation: $22,000
The full list is available in Pittwater Online's March 2023 report, $378,072 Allocated To Council For Weed Control - Governor Phillip Park Gets A Grant This Time: Full Details Of All 11 Sites.
The Crown Reserves Improvement Fund (CRIF) supports Crown land managers (CLMs) by providing funding for repairs, maintenance and improvements on Crown reserves. The funding aims to benefit the community, boost our economy and contribute to the cultural, sporting and recreational life of NSW. The CRIF is a self-sustaining program that is supported by income generated from loan repayments and interest, leases and licences on Crown land, and levies from the operation of coastal Crown caravan parks.
Further, PBWBA President Prof. Richard West AM and Members (around 500 residents) were circumspect on how money is being allocated in the 2024-2025 Budget, considering hundreds of millions of Pittwater ratepayer dollars have gone south since May 12 2016 - 'surely barely mowing parks and leaving the clippings in situ when they are, and a weekly garbage collection cannot cost that much', residents have stated.
In their submission on the 2024-25 NBC Budget the Palm Beach Whale Beach Association stated:
''The income is listed as $450.7million with an estimated operating deficit of $5.8M (Recurring each year). Of this, Capital Grants is listed as $31.8million. Does the council have a record of the individual Capital grants that have been received and how they have been spent? Are the accounts audited and if so is it shown where these grants go or do they go into general revenue?
Rates and annual charges is listed as $259.1million (57% of income). How much of this comes as rates from Palm Beach (PB) and Whale Beach (WB)?
How much is raised from:- Parking? In general from PB and WB (2108) and other income; Governor Phillip Park Parking, Golf Club, Dunes, North Palm Beach Surf Club, The Joey, Home and Away and other film making.?
''There is almost no recognised expenditure for Palm Beach and Whale Beach in the Delivery program. On examination we could find only the following expenditure in PB and WB:
- Florida Rd 225 meters road resheeting. We question why Florida Rd. It is in reasonably good condition. We suggest there are many other roads that should take precedence.
- There is no allocation for curb and guttering, footpaths or other roads. Over the years we have submitted many requests for upgrades to roads and footpaths in many areas in PB and WB, many of which are unsafe. In particular Surf Rd at the junction with Barrenjoey Rd. Whale Beach Rd where it continues on from Florida Road and Ocean Place Palm Beach.
There is no budget for major repairs for Whale Beach Pool, only a budget for planning. There is no budget for Palm Beach pool, which requires repairs.
The document allocates funds for a Retaining wall renewal at Florida Rd with $1.1 million costed. This is actually maintenance as the road has collapsed.
''There is very little return in the program for the rate payers of Palm Beach and Whale Beach. Our rates are considerable.
There is no budget for maintaining Governor Phillip Park. There is no budget for the walkway from Whale Beach to Palm Beach along Whale Beach Road or for the completion of the South Palm Beach landscaping program.
Both of these projects were funded under Capital grants from NSW Government. These grants seem to have disappeared. Where has the money gone?''
We attended a briefing by council officers for the community group Pittwater Alliance. We were told under the present budget the NBC will not be able to maintain services or continue their capital works programs.
We would like to know where the capital grant monies have gone. To where have they been allocated?
Where have the monies collected from Governor Phillip Park been allocated? They should have been used to upgrade the park.
When there is a budget problem, the first thing that should to be done is to look at reducing expenses. We asked what attempt been been made in this respect. The response was that only $400,000 reductions had been found, which is 0.5% of the budget.
The council needs to get back to basics and review its operations and concentrate on its core business, maintaining infrastructure, local facilities, roads, footpaths, rubbish collection. ''
'One of the solutions suggested was a 14% rise in rates. This is unacceptable when many rate payers are suffering severe financial stress due to the rising cost of living. The council must live within its budget and not just treat rate payers as cash cows.''
Northern Beaches Council was doing better when under Administration, some have opined, pointing to the 2016-2017 and 2017-2018 Budgets which saw, as one example, over $10.2 million allocated to Warriewood for flood mitigation works that were announced in September 2016 and completed by December 2017. Major works completed included:
- - the widening of Macpherson Street, which has also been raised by 2.2m, and the construction of a bridge over Narrabeen Creek to reduce the impacts of flooding
- - the installation of a roundabout at the intersection of Macpherson Street and Warriewood Road to manage and improve traffic flow
- - the construction of shared pathways between Boondah Road and Warriewood Road to improve pedestrian safety and link to Pittwater Road
- - service works for electricity, water and gas
- - additional kerb, gutter, footpath and drainage works in Warriewood Road from Macpherson Street to Vuko Place.
However, that same 2017-2018 Budget allocated just over $930.000 for a Warriewood Community Centre which has only just commenced, with a breaking-ground ceremony held a few weeks ago, and allocated $7.5million for the NBC Council seawall sections at Collaroy - one of the more unpopular projects undertaken and paid for by all ratepayers.
On Thursday, May 4 2017 Northern Beaches Council released details of the 2018 rates at an Extraordinary Meeting of Council (held 3 May 2017). Residents of the former Manly and Pittwater Council’s would see rates increased by 1.5 per cent, while the Special Rate Variation for former the Warringah Council means rates will increase on average by 9.4 per cent.
The rates, which included the Special Rate Variation for the former Warringah Council were determined by the Independent Pricing and Regulatory Tribunal (IPART). In 2013 then Warringah Council Councillor Vincent De Luca OAM voted against the Mayor of Warringah and his political party’s decision to apply for a Special Rate Variation to the Independent Pricing and Regulatory Tribunal (IPART) to increase Council rates by approximately 25%.
''I felt such an increase was unsustainable, unfair and Council needed to pull in its own wasteful expenditure before slugging rate-payers. I led a community campaign against the proposal and while IPART granted an increase in rates of 19.7%, my and the community’s campaign ensured the higher rate application was rejected.'' Cr. De Luca stated prior to the 2017 Council Elections.
The 2017-18 Budget also listed almost $41millon in rates being derived from the Pittwater Council area, $29.533million(25,145 residential and business rates) from the Manly Council area (18,757 residential and business rates) and $88.942million from the Warringah Council area (57,119 residential and business rates) with the SRV included.
In the aftermath of the 2021-2022 Budget being passed through the block-vote of Your Northern Beaches Councillors, Councillor Vincent De Luca OAM told Pittwater Online News, “'Since the amalgamation of Manly, Warringah and Pittwater Councils, rates have gone up by $30m. With increases in rates every year since amalgamation, the rates have gone up by 20.5%.
''This is despite Mayor Michael Regan campaigning, using $500k of ratepayers’ money, while Mayor of Warringah, for the amalgamation of the entire Northern Beaches ie Pittwater, Warringah and Manly Councils and arguing rates would go down.
Mayor Regan stated “They (NSW Government when proposing the abolition of Warringah Council and allocating half to Pittwater and half to Manly) want to increase your rates, give away your assets and split your community. I’m not ok with that, are you?”. He stated that unless the entire Northern Beaches and three Councils were amalgamated that “this will force rates up by at least 10%.”
I moved Motions and amendments under the previous Warringah Council, that a Community Poll be held with the people democratically voting, before Mayor Regan’s proposal for the entire three Councils be merged be submitted to the State Government. However, Mayor Regan, his political party and faction continually voted these moves for democracy down.
The bureaucracy and red tape was also not cut, as was promised with amalgamation. It’s worrying that $138m of rate payers’ money will be spent on staff salary and oncosts equating to over 40% of the entire budget.
The CEO, Ray Brownlee will have a salary of $522,332, Directors (which were increased from 3 to 6 following Mr Brownlee’s arrival) will cost $5,223m, Executive Managers will cost $5.9m and Managers $15.2m, Team Leaders and Coordinators will cost $18.6m - 200 staff will be provided with vehicles which can be used for personal use. Staff were unable to advise the cost of purchase and running costs and took the question on notice.
Considering the amount of complaints Council received about bins not being collected and the admission by URM in numerous media articles that they always been collecting waste prior to 6am[...], I do not believe ratepayers’ are receiving what they have paid for and there is no justification to increase rates or waste collection fees” Cr. De Luca concluded.
The 2021-2022 Budget increased Business Rates for Pittwater and Manly from between 42% to 25% as part of a 'rates harmonisation' process required by the State Government that had forced the merger of the councils.
On May 14th 2021 then Minister for Local Government Shelley Hancock said the Local Government Amendment Act 2021 implements the Government’s response to IPART’s review of the rating system and a range of other changes.
Cr. De Luca went into bat for residents at the June 25 2024 Meeting again, moving an Amendment to the Budget Item, seconded Cr Stuart Sprott, that;
13. Note:
a. The highest number of (public) submissions, 31, were received opposing the proposed 4.9% rate increase. Suggested ways of balancing the budget included Council reducing its own expenditure by cutting projects, looking at the organisation structure and focusing on core business.”
b. The 2024/25 Events budget (excluding staff costs, general equipment, insurance and music licences) is $1,657,837.
c. The 2024/25 Arts & Culture budget is $1,157,020.
d. The 2024/25 Community Grants budget is $1,909,276, which includes $310,000 in grants under the Arts & Creativity and Events budgets.
e. The 2024/25 Marketing & Communications budget is $1,552,091.
f. The budget for the 110.6 management FTE positions is $25.2 million and 39% of the 2024/25 Operating Expenditure budget is for all employee benefits and oncosts (excluding Kimbriki’s staff costs).
Management level 2024/25 Budget FTE
CEO $556,361 1.0
Directors $2,071,145 5.0
Executive Managers $6,606,678 22.9
Managers $15,970,078 81.7
TOTAL $25,204,262 110.6
g. The budget for vehicles allocated to staff in 2024/25 is $3.3 million.
h. That in 2023/24 Council collected: $2.2 million in Stormwater Charges but expended $11.6 million and $1.1 million was collected in Sporting User Fees, but $13.2 million was expended for the maintenance of sportsfields, excluding capital renewal and upgrades.
14. That in view of the matters raised in 13a to h above, the Chief Executive Officer be requested to furnish a report within six months addressing:
a. What action Council, if any, can take to ensure rates are not increased on an annual basis;
b. Council’s current management and staff structure, staff salaries and oncosts and any possible reforms and savings that could be implemented.
c. Council’s Vehicle Pool, and whether novated leases for staff vehicles can be introduced instead of Council expending rate-payers’ money on such vehicles.
d. What Council assets/land can be either repurposed or sold for public benefit or public/private partnerships entered into to deliver new infrastructure and services to the Northern Beaches community.
e. Council’s Budgets for Fees, Events, Grants, Marketing & Communications and other expenditure and possible savings.
Cr De Luca's Amendment was defeated.
Correspondence from residents has expressed both support for high salaries for high-pressure positions within the council and the opposite, some pointing out salaries exceed that paid to Australia's leading politicians. A June 17 2024 decision by the independent Remuneration Tribunal means all federal politicians will get a 3.5% pay rise from July 1. Prime Minister Albanese’s salary will rise to $607,520 while the base salary for MPs will increase by about $8,000, bringing the minimum pay of a backbencher to $233,660 per year.
Council's feedback on their Draft 2024-25 Budget shows submissions on the Long-Term Financial Plan raised 7 issues. The issue receiving the most comments related to Scenario 2, the 'Alternative Model'. This model was included in the document to explore the revenue implications of addressing the renewal and maintenance funding gap identified in the Asset Management Plan through a special rate variation (SRV) of 10.6% in 2025/26 on top of the IPART rate peg, estimated at 3.4%. Submissions opposed the alternative model, one suggested staging the increase over a longer timeframe while one supported the model.
Council's Meeting made it clear that any plan to introduce an SRV would be subject to community consultation prior to being submitted to IPART and would list what any increase in money would be allocated to - the program of works - and if for infrastructure IPART would do a detailed review of Council's documents.
The recurring deficit of $5.8 million was explained as the difference between the CPI rises and council rate rises, and why the SRV 'Alternative Model' was included - although this does not form part of the Budget now passed.
NBC was granted a 3.7% rate rise for 2023-2024 through IPART, 2.4% in 2022-23 after Council applied for this as the rise that year had begun below inflation, along with the aforementioned 'rates harmonisation' hit to local business properties, some of which would have been passed on to those renting those premises to run a business from.
The Independent Pricing and Regulatory Tribunal of NSW (IPART) set a rate cap of 4.9 per cent for Northern Beaches Council, and with this Budget passed. This will result in an increase of around $103 for Pittwater residential ratepayers for the 2024-2025 year. The annual domestic waste charge will increase by $31 to $586.
Council states the LGA will benefit from services and projects totalling $524 million, including an injection of $99 million in infrastructure spending, as outlined in the 2024/25 Northern Beaches Council budget.
The Document states; 'While the budget is balanced, Council is not anticipated to meet the Office of Local Government’s financial and asset performance benchmarks due to the deficit operating result and depreciation outpacing expenditure on renewing assets.'
'The budget has a focus on resilience and environmental sustainability, prioritising projects and services that support and strengthen our community and environment.
The proposed $99 million capital works program includes $43 million in asset renewal to improve the overall condition of our assets and to reduce ongoing operational costs associated with asset repair and maintenance and the $56 million is slated to deliver high priority new assets to the community.
Mayor Sue Heins thanked all those who gave feedback during the consultation period.
“The 24/25 budget supports Council to get on with a range of projects that will protect and enrich life on the Northern Beaches,” Mayor Heins said.
“It enables us to continue to maintain and renew community facilities, prioritise road and footpath repair, improve the stormwater network, deliver new infrastructure and pilot new programs to divert more waste from landfill.
“However, Australia is in a challenging fiscal environment with escalating costs in materials, contracts and construction which impact on our budget. Add ongoing cost shifting from other levels of government and a rate peg that hasn’t matched inflation over a number of years, and Council’s long term financial sustainability is under pressure.
“As we look to the future we will need to work with our community to continue to deliver services and community infrastructure in a sustainable way.
“Thank you to the many people in the community who provided feedback during the extended consultation period.”