A meeting will be held at 3pm on September 6 to formally note the proposed Performance Improvement Order the Minister for Local Government Ron Hoenig is considering issuing to Council for 12 months.
Administrator Rik Hart is set to adopt the following submission:
Central Coast Council refers to your correspondence dated 2 September 2024, regarding your notice
of intention to issue a Performance Improvement Order (PIO) to Central Coast Council, under Section
438A of the Local Government Act 1993.
As you noted, Central Coast Council is now in a sound and stable position to continue delivering
services and infrastructure to the community over the long term. While financial sustainability is a
challenge for many councils, to be in this position after experiencing the worst financial crisis in
Australian local government history is a remarkable achievement for this Council and our community.
Restoring Council’s financial settings whilst maintaining service levels to our community has required
the implementation of a Financial Recovery Plan which included rate increases, asset sales, significant
reduction in resourcing and operating budgets, and a cap on capital projects.
Following restoration of Council’s financial position, further work has continued to rectify root causes
leading to the crisis. This included realignment of services and resourcing, implementation of financial
discipline through a governed budget process and ongoing monthly financial reporting, and a capital
works program focused on renewing existing infrastructure and considering the availability of cash.
Council’s success in turning its financial position around is evidenced by an operating surplus being
achieved for three consecutive years, whilst holding an adequate level of unrestricted cash, reducing
debt and renewing assets. In November 2023, Council also adopted a Financial Sustainability Strategy
to support its Long-Term Financial Plan, which is being updated annually as part of the annual
Operational Plan process.
At the same time Council has also continued to strengthen its governance framework and has been
successful in securing legislative changes to manage its Water and Sewer Business and the associated
restricted funds more effectively.
Considering this background, Council welcomes your intention to issue a PIO, setting clear
expectations for the incoming Council. We concur with your view that the PIO will serve the purpose
of ensuring that the good work undertaken over the last 4 years is not lost in the transition to an
elected Council. It will be very important that incoming councillors are able to represent their Title
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constituents effectively and can do so without adversely impacting the position of the Council now, or
into the future.
Actions required under 2.1.1 of the PIO regarding staffing will ensure that Council’s effective operation
is not unnecessarily disturbed through changes at the executive level and delegations. The
requirement for concurrence of the Office of Local Government will ensure that changes are only
made if they contribute positively to the operation of the organisation. This will maintain stability at
the executive level and will foster constructive working relationships to be developed between
councillors and Council’s leadership team.
Actions required under 2.1.2 of the PIO regarding financial oversight and discipline are very pertinent
for Central Coast Council. The requirement to implement ongoing recommendations from the Public
Inquiry, and the involvement of Council’s Audit, Risk and Improvement Committee (ARIC) in
governance oversight and changes to Council’s priorities is necessary. This approach will ensure that
the incoming Council remains focused on delivering commitments reflected in the Community
Strategic Plan.
The actions regarding ongoing consideration of the relevant financial benchmarks, and the
requirement to consider the impact of decisions on Council’s long term financial sustainability, will
mitigate the risk of the incoming Council making short term financial decisions that impact on
councils’ ability to continue to deliver services and infrastructure to future generations. This is a
particular challenge for most councillors as the focus tends to be on responding to the demands of
their constituents during their term.
The requirement for regular and transparent financial reporting will ensure that Council remains
accountable to the community regarding its financial position and any associated risks.
Governance requirements under 2.1.3 will further support delivery of the of actions in the adopted
Operational Plan and the maintenance of a sound financial position. The discipline regarding staff
interaction and councillor requests will ensure that resources can remain focused on delivering
adopted plans and not be unduly influenced by unreasonable councillor demands.
Requirements regarding Council meetings and briefings under 2.1.4 will promote orderly and
transparent decision making.
Once again, thank you for your ongoing support in ensuring that Central Coast Council remains
financially sound, now and for future generations.
Yours sincerely,
Rik Hart
END of Submission
