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Newcastle Herald
Newcastle Herald
National
Ian Kirkwood

Central Coast Council woes: financial maladministration, COVID and bushfires, or all of the above?

THE 2016 merger of the Wyong and Gosford councils into a combined Central Coast Council was supposed to deliver a range of benefits under the Fit For The Future "reforms" begun - but eventually abandoned - by the Coalition state government.

Instead, the new council's finances have deteriorated so much that it's needed a $6.2 million bailout to meet what Local Government Minister Shelley Hancock is describing as "payroll expenses and overdue payments to suppliers".

The council is blaming COVID-19, the bushfires and summer flooding for a substantial deterioration in its financial position. Earlier this month it revised its expected budget deficit from $41 million to $89 million after a review of its accounts.

The new council was run by an administrator from May 2016 to September 2017, when the present 15 councillors were elected.

Another poll had been due last month, but the government postponed this year's council elections until September 2021 because of coronavirus.

But whatever the details, the council's financial fall looks to have begun well before the short-term shocks of the past year or so.

Gosford council has had a trail of financial controversies over the years. In August, a NSW Audit Office report found Gosford had for 15 years wrongly used "local infrastructure funds" for general administration - a practice that continued after the merger.

This is money levied from property developments to pay for community infrastructure, and the new council had to put $13.2 million back into the kitty to square the books.

It is worth noting, too, that the council oversees the Central Coast's water supply, giving another layer of complexity to an organisation with a workforce of 2000.

It may be, as the minister says, that the Central Coast community is "sick of excuses" from its council.

The Hunter's Dungog council, which escaped amalgamation under Fit For The Future, has put its shoulder to the grindstone since then and has apparently managed to keep its head above water.

At the same time, the local government sector as a whole has long complained about the impacts of rate-pegging and other imposts, including substantial waste levies and the "cost shifting" of responsibilities from state to local government.

And if COVID-19 is adding substantially to council costs, then the Central Coast might not be the only administration facing potentially serious trouble.

ISSUE: 39,445.

Central Coast mayor Cr Lisa Matthews
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