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Addressing financial challenges

The Bugle App

Local Contributor

17 July 2024, 1:10 AM

Addressing financial challenges

It is of concern that some of your correspondents have as much financial expertise as the former Counsellors and staff who created the current financial crisis in KMC. Whilst the provision of retirement living facilities for local residents is an admirable cause, these facilities are increasingly complex to manage and costly to run.


And the sponsoring Council and Councillors require considerably more financial expertise to manage than two decades ago. A more fundamental issue is whether Councils are best placed and sufficiently competent to establish and manage these facilities. Furthermore, Kiama is a small municipality that lacks the revenue streams to offer other than basic services.


Over the past 2-3 years the Council has been presented with expert financial analysis and recommendations from both the Office of Local Government and its local Finance Advisory Group which they have chosen to reject. These recommendations, if accepted, would require courage and foresight to implement and Councillors’ solidarity to persuade their stakeholders of their necessity.


The forthcoming Council elections may have influenced their lack of courage to take the tough decisions that are required to rescue our Municipality from administration. The solution must incorporate sharp cost reduction measures: staff and capital works reductions. This potentially unpopular step must be accompanied by raising revenue without selling assets, as directed by the Office of Local Government. As a last resort a special rate variation can be applied for but this does not resolve the fact that our costs are not covered by our revenue. Once again the Councillors kicked this challenge into the future when the problems might miraculously disappear or become someone else’s problem. That’s the day when the sun will rise in the west! These initiatives appear unpalatable.


Clearly some residents oppose the sale of Blue Haven and other assets. Some blame the current CEO. Few seem willing to go back to the perpetrators who set up our Council to fail. Even fewer seem to acknowledge the effort and expertise put in by the CEO and her staff to analyse and diagnose the root causes of our poor financial position and to propose solutions that would enable KMC to recover. Whilst some of the current criticisms are well meaning, they are misguided. It’s time to put the facts before emotional responses to a situation that involves us all. Roger R Collins Gerroa 0408276430