Redundancies made as pool drains budget
North Sydney Council has cut staff in an attempt to stave off a worsening financial position, with unexpected costs for the Olympic Pool project continuing to hurt its budget.
Councillors will vote on an updated draft budget for 2024/5 – including an $8.5 million deficit – at its 22 April meeting, with a stern warning from managers that ‘repeated deficits are not sustainable’. Further cuts to an already paired down capital works budget have been proposed so that more than half the money can be spent bumping up the pool. In response to a question from North Shore Living, chief executive officer Therese Cole revealed that last year council had started to conduct an ‘extensive review and realignment of our workforce,’ with ‘tier two and three management layers reduced to allow funding (to resource areas of need without additional cost)’.
“Had this review not been undertaken, the financial position would be worse,” Ms Cole said.
The CEO said the COVID-19 pandemic had created a ‘financial shock for council from which it has not recovered’.
In a report to the forthcoming meeting, staff managers said that council had a $8.5 million deficit before capital grants and contributions. “Council cannot maintain financial viability, fund the Olympic Pool project and manage its assets to an acceptable service level if similar operating results persist in future years,” they said.
The majority of council’s income is from rates and annual charges, with $78.8 million expected for the 2024/5 year. While a special rate variation to increase rates has not yet been put on the agenda, Ms Cole said council would be embarking on community consultations from 12 May to determine ‘what services and infrastructure they would like to see over the coming 10 years’. “This will inform our resourcing needs and assist us in developing financial solutions.”
Neighbouring Willoughby Council has recently applied for a 15 per cent rate rise to deal with an impending budget deficit as many councils struggle to recover from reduced income over the COVID-19 shutdowns. North Sydney staff also attributed its deficit to reduced revenue from parking and fines, increased costs from higher inflation – some 10 per cent over two years – and a higher cost for borrowing money, which has resulted in $1 million interest for the pool alone.
Long-awaited drainage improvements to Primrose Park sports fields would be delayed if the new budget is passed.
Community feedback is due 19 May, with implementation by 30 June.