Kiama councillors have been thrown a lifeline to avoid extensive cuts to community services. Photo: Kiama Council.
The NSW Government has given Kiama Council a 12-month reprieve to get its finances in order, allowing it to shelve controversial cuts to a raft of community services.
Just over a month ago, council revealed it was proposing extensive closures or cuts to services such as youth, cultural and tourism, alongside reduced hours at libraries and Kiama Leisure Centre, in order to meet a $4.5 million black hole by 30 June 2027.
A draft budget went on public exhibition on 24 April and received so many responses from the community that on Thursday (14 May) council announced it was forced to push back an extraordinary meeting to discuss the budget to 30 June.
But just hours after the announcement, NSW Local Government Minister Ron Hoenig effectively handed council a 12-month extension to bring in a balanced budget.
The minister has given notice of a proposed variation to the existing performance improvement order (PIO) to give council more time – until the 2027–28 financial year – to identify sustainable revenue measures and implement savings in a staged way, while reducing immediate pressure for deeper cuts to local services and jobs.
Council now has 14 days to consider the proposed variation and respond to the minister.
“Kiama Municipal Council has made progress, but the job is not finished,” Mr Hoenig said.
“This proposed variation gives council more time to work through sustainable revenue options and staged savings measures as it works to bring its budget back into balance.
“The performance improvement order did not create Kiama Council’s financial problems. It remains in place because those problems have not yet been fully resolved.
“The performance improvement order remains necessary because Kiama Council still faces serious financial sustainability challenges.”
Kiama Mayor Cameron McDonald thanked Mr Hoenig for allowing council extra time to balance its budget.
“We welcome the offer of a variation to the PIO. Plenty of hard work has already been done to get Kiama Council in a position where we are close to completing all of its requirements,” he said.
“Now that we have until 30 June 2028 as the deadline, it means council will not have to make changes to our community and youth services, our libraries, Kiama Leisure Centre, the Visitor Information Centre and the Pilot’s Cottage Museum.
“I’d like to acknowledge the positive feedback and contribution of our community members and countless hours that have gone on behind the scenes by council’s staff to bring us to this positive outcome.”
Under the proposed variation, council would be required to:
- prepare an independent business case for Blue Haven Terralong identifying the most sustainable long-term operating model
- identify potential recurrent revenue measures
- provide the Office of Local Government with a report on proposed savings measures
- update its Finance and Governance Improvement Plan to include a strategy to improve cash balances and end the practice of adopting deficit operating budgets
- retain domestic waste services in-house
- strengthen its ongoing financial reporting to the Office of Local Government.
The revised timeframe would also allow council to investigate opportunities for the long-term management of its five tourist parks, which could improve its budget position over time.
Cr McDonald said CEO Jane Stroud would prepare a supplementary report for next Tuesday’s (19 May) ordinary meeting for council to consider the information contained in the updated PIO.
Ms Stroud said the proposed variation meant the council’s ability to meet the PIO was looking more positive than ever.
“We know from our three holiday park offers that our ability to clear the projected deficit is certain, provided we can get through the tender process with a successful outcome that finds the right partnership arrangement,” she said.
“We’ll still need to carefully manage our staff vacancies as well as right-sizing the organisation through a restructure.
“We need to maintain very careful financial management as well as progressing our catalyst sites for long-term financial sustainability.”
The draft budget and associated documents remain on public exhibition for comment until Sunday 24 May.
Council will hold an extraordinary meeting on 30 June to consider the final recommendations for the budget.
