Council has no cash to splash

SOUTH Gippsland Shire Council’s finance chief has assured the community council is not holding a sludge fund of cash.
But council’s finance manager Tracey Lindupp told councillors last Wednesday she was pleased with council’s End of Year Financials 2017-18.
“It’s a healthy set of financial results,” she said.
Council will have no outstanding borrowings in the 2019-20 financial year and is expected not to borrow money at least until 2030-31.
“Long term sustainability sets us up for the future and ensures we can continue to provide the services we are currently providing,” Ms Lindupp said.
Council’s surplus will drop to a projected $1.38 million in 2018-19. Council’s operating surplus for 2017-18 is $7.5 million, but $4 million of this comes from prepaid grants relating to 2018-19. The remaining $3.5 million is required for capital expenditure over the long term.
Mayor Cr Lorraine Brunt said there had been misconceptions and concerns surrounding the amounts of surplus.
“I wish to assure our community that council is operating in its best interests whilst ensuring the organisation can function effectively to provide essential assets and services,” she said.
“By no means would council hold on to an unnecessary surplus. All of these finances are dealt with professionally and are accounted for in future projects and loan payments.”
Cr Brunt said council has not been able to secure funding for large projects lately.
“If we get the Leongatha streetscape, which is a shovel ready project, that would chew it (surplus) up very quick,” she said.
Cr Brunt said council’s reserves were “only a safety net for a black swan”, referring to any possible costs that may arise.
Ms Lindupp said council needs to be achieving surpluses to put towards future capital works.
“We have enough cash to fund the capital works that we have budgeted for, which are quite significant, over the next couple of years,” she said.
Ms Lindupp said council faced possible future superannuation defined benefit calls in the future, but not in the short term.
This requires council to pay to top up certain employees’ superannuation funds to a guaranteed amount, under a previous superannuation scheme.
Cash and other financial assets will drop from $29.72 million in 2017-18 to a projected $18.87 million in 2018-19 due to a large program of capital works, including the Bena-Kongwak Road bridge at Bena and the Mirboo North Pool refurbishment.
The Victorian Auditor-General approved council’s financial report.

Talking numbers: from left, South Gippsland Shire council’s finance manager Tracey Lindupp discusses the End of Year Financials 2017-18 with council’s acting director of corporate and community services June Ernst in the council chamber in Leongatha last Wednesday.

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