Attack on all fronts

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Attack on all fronts

South Gippsland Shire Mayor, Cr Warren Raabe.

SOUTH Gippsland Shire Council can learn from a critical audit released by the Victorian Auditor-General last week, mayor Cr Warren Raabe believed.
The report revealed council could make major improvements, after the Auditor-General assessed the effectiveness of council’s business planning, and budgeting for capital works and services.
The report claimed that South Gippsland, along with Whittlesea and Hepburn councils, could not demonstrate all investment decisions were sound, nor that that services were targeted or met community needs.
The report said council had poor quality strategic, financial and asset management plans, lacked community consultation, and offered little assurance its long term financial plans reflected future needs. These were the details of the report, Business Planning for Major Capital Works and Recurrent Services in Local Government. South Gippsland was chosen at random for the audit.
Cr Raabe said council was already making many of the changes recommended by the report before council was audited and had made the Auditor-General aware of this.
“It was quite a useful report for us because it highlighted that we are heading on the right track,” he said.
Cr Raabe added that council took the criticism “on the chin”.
“We recognise what they have said. We have steps in place and we have others in place to deal with it,” he said.
The mayor said council needed better links between strategies to ensure a cohesive approach and said CEO Tim Tamlin had created a new framework to do just that.
“We have got the organisation flowing better. We have most of our senior staff on board and have about two senior positions to fill,” Cr Raabe said.
The report said South Gippsland could not “provide adequate assurance to ratepayers they are spending their funds appropriately and effectively.”
“The absence of robust strategic, operational and financial plans supporting annual budget decisions at these councils means they cannot demonstrate that they are effectively managing their costs or that their expenditure decisions are sound,” the report stated. The mayor rejected that claim.
“There is no doubt in my mind that the money we are putting into the community is spent well; it’s targeted well and spent strategically but I understand there are linkage problems (between plans),” he said.
The report claimed 60 per cent of council’s assets were not backed by sound asset management plans, a weakness in the council identified in the 2005 audit.
“In the absence of a robust asset management framework, these councils cannot accurately determine their capital expenditure needs or assure that these needs are adequately reflected in their long term financial plans or annual budgets,” the report stated.
“South Gippsland affirmed this situation and advised that there are potentially significant funding requirements for pools, waste management and buildings within its municipality that are currently not reflected in the long term financial plan because of the absence of adequate asset management plans.”
Council’s asset management plan is still at least two years away from completion, but council has appointed an officer specifically to that role.
“Financially we have come out of this report well and I think that the report backs us there, that we have improved our financial position,” Cr Raabe said.
“We are almost at the point where we feel we have ourselves covered and ready to take on future challenges. An example of this is that we were able to duck in and pay for Carino’s and pay cash ($850,000) for the superannuation liability. We paid that off in six weeks and we are ready for the next one.”
The mayor said council could be consulting with the community better and had sought community input into the current budget and council plan.
Council returned more than a 50 per cent difference between estimating future capital expenditure and real costs.
“South Gippsland staff noted that the uncertainty and timing of Commonwealth and State Government grant approvals for capital works affected the accuracy of their planning and budgeting,” the report stated. The Auditor-General found that council was too ambitious, scheduled 60 per cent of projects to be completed in the current year of its financial plan, rather than over the four years of the plan.
“South Gippsland has since acknowledged this is unachievable and has developed a draft 2011-12 annual plan with more realistic targets,” the report stated.

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Posted by superadmin on Sep 22 2011. Filed under Featured, News. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry

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