Once-Touted ‘Best Councils’ now Falling Stars

Latrobe and Kentish Councils were put up on a pedestal by the Local Government Review Board as the best way forward only six months ago.

Now where are they sitting? Last week saw what that looks like:

• Over $7,500,000 in deficits;
• 30% increase in the General Manager’s salary for incomplete projects and financial mess, along with 28% increase to salaried staff and 24% increase to waged staff, all whilst debt increased to 105% of income and more requests for state and federal funding to complete some of the projects and the business units going backwards;
• 65% increase in one year of Council Land revaluation to support the asset column in the budget?
• a top secret late agenda item – Item 19 Urgent Business – that no one knows about?

The Long awaited Auditor General Report states: “In my opinion, the accompanying financial report: (not including some business activities i.e. caravan park, Camp Banksia)

(a) present fairly, in all material respects, Council’s financial position as at 30 June 2022 and its financial performance and its cash flows for the year then ended

(b) are in accordance with the Local Government Act 1993 and Australian Accounting Standards.”

Key Audit Matters = “Valuation of property & infrastructure assets Refer to notes 6.1 = works in progress and 9.11 = Fair Value Measurements”

In 13 December 2021 AGM Minutes: Motion from the Floor, saw the Premier’s father Richard Rockliff: “I think it has been an outstanding achievement.” He moved that the annual report be received, seconded by Rob Beveridge.

Cr Allison spoke against the motion and later moved a motion of no confidence in the Mayor, Councillors, General Manager and Acting General Manager. This was due to what he believed was “the oversight, conduct and general administration of the Latrobe Municipality.”

Ex-Deputy Mayor Richard Rockliff spoke against the motion, saying “how he believes everyone should be grateful for what we’ve got.” Current Councillor Martin responded: “that the mover and seconder should be disgraced” along with half a dozen who criticised Cr Allison for his motion. There were over one hundred and sixty persons present at the meeting, most supporting Council unreservedly so.

16 months later we now find that only six months after that AGM of 2021 the financial position was already a mess; Cr Allison may well be justified in his actions taken at that December 2021 AGM. Yet He is still being pursued by Latrobe Council and the State Attorney General through the courts for his motion of no confidence.

The question must be asked: why? And what more has the council and state government been hiding in the Premier’s back yard?

At the AGM held 15 December 2022 less than twenty people attended, and a majority of those from Meadcon. An unaudited financial report was presented. Did the underlying powers know what the possible true state of affairs was so they chose not to show up? Or are they distancing themselves from what is being presented 12 April 2023?

Richard Rockliff is still heavily involved with the council and committees and the Premier is quoted in this current agenda supporting Henley on Mersey, which clearly shows how deep the connections are between the state government and council.

Deputy Mayor Mead – whose maiden name is Rockliff – has standing registered conflicts of interest in several of the committees she sits on or chairs. This tangled web of power has shown signs of unravelling with the Mayor now being the principal on the panel to hire the manager of operations in February.

Does he have no confidence in the General Manager or did he have a required outcome for the operations of Council that he needed to ensure happened?

If you look closely at this month’s general meeting agenda on the 12 April 2023, 17:00, we can see after we zoom in on what must be the smallest font printed financials you can place into an agenda:

Page 328 10.5 Net Financial Liabilities 2022 = ($16,351,000) over $15,523,000, this shows approx. 900,000 or 105% more debt than incoming funds. 2021 result = (10,376,000) over $13,420,000 this shows we had 3 million or -77% more income then debt.

Page 379 Levee update calling for more funding from state and federal authorities

Page 309 9.2 Result cash flow operations 2022 = $830,000 compared to 2021 = $8,937,000, over 8 million reduction or 10 times.

Page 308 9.1 Fair Value revaluation of Land and Land under roads. From 2021 = $13,519,000 a revalue of $9,960,000 in one financial year brought an almost 70% increase in value to a total now of $23,480,000.

Page 298 Works in Progress all went up by huge numbers 2022 = $8,004,000 2021 = $3,544,000 except computers, fittings and furniture. This graph is a must-see-to-be-believed.

Page 294 4.2 Trade and other receivables sees Kentish get whacked with hefty bills up 160% 4.1 Cash on hand is down 45% for the year from $2,250,000 to $1,456,000 (The General Manager stated at the AGM 15 December 2022 that cash on hand was just over $4,000,000. That was not the case and a long way from it.

Pages 290 to 293 show some alarming figures going upwards in costs and downwards in revenue and at a rate of knots.

For example Insurance is up over 100% from $89k to $165k, Interest on borrowings rose from $8,000 to $76,000 and will go crazy on 1 April 2024. Audit costs climbed from $26,000 to $50,000, Impairment of receivables from $3,000 to $95,000. Income is down from $510,000 to $394,000 (sundry income – $100k), Non Money Assets from $7,681,000 to $3,431,000 which is nearly a 50% reduction.

The scary thing is that this is Latrobe’s audit for 2022. What will the Kentish audit look like? It may well be even worse so the combined result for year ending 30 June 2022 for both councils could be a red wave.

Looking forward over the next two and half months I can only wonder what financial surprises lay in store for both these councils joined at the hip by management and both struggling to survive. If I was a ratepayer I would be extremely concerned on what the rate hike may turn out to be.

On a positive note Kentish has the traditional owners flag flying high in Sheffield! So Latrobe hopefully won’t be far behind them. It’s great to see progress on this front, given the significant relationship with traditional peoples both in Latrobe and Kentish municipalities in the past and hopefully well into the future.

James Redgrave is a private investigator and a keen observer of local government, and governance, in Tasmania.