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Newcastle Herald
Newcastle Herald
National
Jamieson Murphy

New batch of councillors need to make smarter decisions to tackle huge debt

The Warbirds festival and the Coulsons Creek Road fiasco have hurt the council's finances. Pictures supplied

The incoming group of Upper Hunter Shire councillors need to guide the council out of its dire financial situation and make better financial decisions.

The council is expected operate with a deficit until 2032 and is managing a $32-million debt, which includes pursuing a special rate variation (SRV) of 10 per cent a year for three years, for a permanent cumulative increase of 33.1 per cent.

Documents reveal the council has returned an operating deficit for the past four years, and in 2023/24 collected $12.4 million in rates against a $50-million operating budget.

The council has blamed its financial difficulties on the increasing cost of maintaining infrastructure, particularly its large road network in the wake of multiple floods and fires, the effect of inflation on construction costs and state government cost shifting.

These are all valid arguments, and yet councils across the nation are dealing with the same issues without the need to develop a financial recovery plan.

Upper Hunter told residents it would pursue the SRV, citing many of the above arguments, and in the same meeting revealed the council-run Warbirds Over Scone festival flopped to the tune of $133,000.

The loss was even hailed as a small win, because it lost $87,000 less than the previous event.

"By comparison, the 2022 Warbirds Over Scone event incurred a loss of $219,878. Accordingly, despite the loss sustained by the 2024 event, the net result is a marked improvement on the 2022 event result," council papers said.

Council bungled the upgrade of Coulsons Creek Road, which saw the price tag jump from $8 million to more than $56 million and take more than five years to finish.

The council also spent almost $10,000 fighting a freedom of information application from one of its own councillors who was trying to get access to the project's geotechnical report.

In both cases, the council conceded the projects would be better managed by other organisations - Coulsons Creek Road is now being handled by Daracon Group, while council will seek an independent operator for future airshows.

Had these decisions been made earlier, millions of dollars could have been saved.

Upper Hunter Shire Council is expected to raise its ratepayer income by about $4 million annually with the special rate variation.

It has estimated it can generate an additional $200,000 in revenue and save up to $750,000 through an organisational restructure.

There are 11 people standing in the election and the incoming group of councillors will feature at least four new faces.

Councillors Ron Campbell, Belinda McKenzie and Lee Watts will not recontest their seat, nor will former councillor Elizabeth Flannery, who was forced to step down after missing three council meetings in a row.

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