FAQ

We’ve been working to renew our roads, footpaths, pools and other community infrastructure for a number of years. Many of these structures were built in the post-war years, and are now more than 50 years old. We need to make sure we have finances set aside to maintain these assets into the future, and to build new resources to meet the community’s needs.

Over the past five years we’ve made savings of $20.3 million each year and that money has been used to improve ageing assets such as roads and footpaths, as well as the Crown Street Mall and North Beach Bathers Pavilion. But now we need to look at other ways we can secure the funds needed to keep our infrastructure well looked after.

If we don’t do this, we’ll start losing things like roads, buildings and rock pools as they deteriorate.

The Citizens Panel has not made any decisions – they put forward a number of recommendations as a starting point for community discussion. The Panel was randomly selected to represent a cross-section of the community, including people we don’t normally hear from.

Following the community’s feedback on the Panel’s recommendations, we’ve put together a series of options that look at different ways we could save enough money to look after our assets into the future. One of these options is based on the Panel’s recommendations, while two alternative options outline other opportunities.

All decisions will be made by our elected Councillors, who will consider not only the Panel’s recommendations, but also feedback from the community and Council staff.

Not at all. Council needs to hear from all community members, community groups, neighbourhood forums and people from interest groups. We’ll continue this discussion into 2014, and your feedback will help Councillors in their decision making.

We’re currently presenting three options for your feedback. While Councillors may decide to go with one of these options, it’s also possible that they’ll make some further changes before settling on a final strategy.

One of the recommendations in the Citizens Panel report was to reduce the number of ocean rock pools. This would mean over the next few years, as pools failed, Council would work with the community to discuss whether repairs were appropriate. It’s clear from community feedback that rock pools are highly valued and this will be taken into consideration in making any decisions.

If the decision to rationalise 10 per cent of playgrounds, parks and community facilities were made it wouldn’t happen overnight. It would take place over a number of years. Council has 151 playgrounds, and in a 3-5 year  period approximately 30 are expected to reach the end of their useful life.

We’re in the process of preparing a Play Strategy, which will provide a plan for the development and management of play spaces for 0-12 year olds across our city. This Strategy will be developed in consultation with the community and will prioritise playgrounds for replacement.

Some of the community facilities in our city were built in the middle of last century, and they’re starting to show their age. In some cases, it can be more expensive to repair and maintain these facilities than to develop alternative options. A good example of this is the removal of two buildings in Corrimal’s Memorial Park. These buildings had a number of major issues, including structural damage and electrical non-compliance risks. Rather than spend hundreds of thousands of dollars repairing these dilapidated buildings, Council worked with the groups using these facilities to find them a ‘new home’ in Corrimal Community Centre. The funds that would have been spent on repair and maintenance of these two buildings can now be channelled into improving other community facilities.

The three options currently being presented to the community all include rate rises above the rate peg. The amount of the rise varies for each option, depending on how many savings are proposed through other methods, like reducing services or expenditure, or changing fees and charges.

Council has advised IPART (the State Government Body that oversees rates) that it intends to apply for a rate rise over the next three financial years, but it has not yet been determined what level that increase will be. We’ll need to make that decision and put in an application to IPART by 24 February 2014.

We understand that rate rises are not a particularly desirable option, but if we didn’t consider this, we’d almost certainly have to cut lots of services which are important to our community. We’re trying to find a balance so that we keep any rate rises as reasonable as possible while still meeting the community’s expectations.

Each year the Independent Pricing and Regulatory Tribunal (IPART) sets or ‘pegs’ the amount of rates councils can collect from residents. The rate peg is expressed as a percentage increase – such as 2 or 3 per cent - and is the maximum amount councils can increase rates without further approval.. The increase is based on the movement in costs in the prior year that affect local government, similar to inflation, along with a deduction for productivity gains (i.e. expected improvements in efficiency). 

The figures we’ve used in the three options reflect the amount of rates increase that would apply INCLUDING the rate peg. At
the time of writing the Council report, we didn't know the rate peg amount for the years 2014/15 – 2016/17, and assumed a rate peg of 2.7% for 14/15, and 3% for both 15/16 and 16/17.

At the same time as our Council report and exhibition documents were being finalised, IPART announced the rate peg for the
2014/2015 financial year as 2.3 per cent. . Its important to note that this has not changed the total proposed increase in rates and the impact on households is the same. This is because the total amount of the increase remains with only a change in the proportion of assumed rate peg and special variation increase. The detail of this change will be reflected in our documentation being reported to Council in February. We still don’t know what the peg will be for later years and we continue to assume a 3% rate peg for both 15/16 and 16/17.

In short, it's possible. However, without a rate rise we’d have to consider greater cuts to services, and increases in user fees and charges, or accept that assets will begin to fail.

We’re not alone in needing to increase the amount of money we put into maintaining our ageing roads, footpaths and buildings. We’re working with the community to look at all the options available to us to make savings – not just focusing on rate rises.

In the 2012-13 financial year about 30 of the 152 local governments in NSW sought rate increases. It’s believed a further 40 will seek rate increases for the 2014-2015 financial year.

Our current discussions with the community aren’t about balancing a budget – it’s about finding ways to make sure we have the money for the maintenance and renewal of our city’s ageing roads, buildings, pools, footpaths, and centres.

Right now, our budget’s in good shape with a sound outlook. We’re in a positive financial position with low levels of debt and a balanced cash flow over the next 10 years. Over the past five years we’ve made savings of $20.3 million each year and put this back into improving ageing assets. But we’re going to need to do more as more of our assets age and need to be repaired or replaced.

There’s no simple solution to securing the future of the city’s assets and services, but we need to have the conversation about how we can solve this now. These decisions will affect everyone who lives in our city. By working with the community we can develop a plan that outlines how to sustainably maintain our ageing roads, buildings and footpaths. This way we can have steps in place for the next generation.

The whole point of securing our long term future is to improve our infrastructure across the city, and we’ll keep working towards that goal. The Grand Pacific Walk and the refurbishment of Crown Street Mall are just two of many projects we’re currently working on or planning to make our city better.

The Crown Street Mall is the perfect example of the type of infrastructure renewal we’re working to address. The original Mall was opened in 1986 – 24 years later, the CBD Action Plan recommended the Mall needed a redesign to make it safer, lighter and more attractive for shoppers and visitors. We’re refurbishing the Mall with the help of a $5 million grant from the Australian Government’s Regional Development Australia Fund.

Likewise, we’ve recently been successful in securing over $30 million from the State Government’s Restart Illawarra program that will go towards the Grand Pacific Walk, an access road link for West Dapto, and improvements to Bald Hill.

We’ve also secured low-interest loans through the NSW Local Infrastructure Renewal Scheme (LIRS) to help us improve footpaths, roads and other local assets.

We’ll keep applying for support from other bodies where we can, but we also need to make sure we allocate our own funds to keep improving our infrastructure.

Council has 1674 staff, including full time, fixed term, temporary, casual, and cadets, apprentice and trainees. Employee costs are 38 per cent of our operational expenses. In 2012/2013 employee costs were $99.1 million.

The three options to address Council’s financial future currently on public exhibition look at whether Council should reduce or cut services, consider a rate rise or sell selected assets. They’re listed as part of Council’s draft Resourcing Strategy.

Council’s Resourcing Strategy outlines how Council will achieve the community’s long term goals for our city. These aims are set out in the Wollongong 2022 – Community Strategic Plan and details of how we’ll manage our finances, assets and people.

The Delivery Program is linked to both Wollongong 2022 and the Resourcing Strategy. It outlines the key actions Council will undertake over the next five years in working towards the community goals.

Since the options to address Council’s financial future have an impact on both the Resourcing Strategy and Delivery Program, we’ve put the draft documents on public exhibition for community feedback.

Council is exhibiting three options that outline possible changes to services, savings to be made by improving efficiency, and / or potential increases to rates and fees and charges. Until 5 February 2014, the community is invited to give feedback, which will be presented to Councillors to assist them in their decision making.

In February 2014, Council will meet to decide on a preferred option. This could be one of the three options exhibited, or Councillors may decide to make further changes at this stage. Once an option has been selected, the Resource Strategy and Delivery Program will be revised to reflect this.

The option selected to Secure Our Future will become part of our planning process, and will be incorporated into our annual plan. The annual planning process will start in March, and the Annual Plan will be exhibited for community comment in April-May, before being adopted in late June.