Not financially viable: Council don’t support de-amalgamation proposal
30 April 2019
Southern Downs Regional Council won’t support the Granite Belt
Community Association’s (GBCA) proposal for a new regional council because it
is not financially viable.
Council today considered its position on de-amalgamation resolving
that it will not support the proposal for de-amalgamation because of the significant financial
risks identified in the Queensland Treasury Corporation’s (QTC) financial analysis
of the proposal.
De-amalgamation of the Granite Belt from the Southern Downs is not
financially viable unless significant increases in net rates and utility
charges are absorbed by the Granite Belt community.
Seven Councillors resolved to support the motion while two voted
“Each Councillor made a decision they considered to
be best for the future of our region and in the best interests of our whole
Downs Mayor Tracy Dobie said.
Cr Dobie said the cost of de-amalgamation would place significant
financial burden on rate payers as well as impact the future prosperity of the
“Councillors have listened to many members of the community, both
in the Granite Belt and in the other parts of our region, and today have spoken
honestly about their concerns, their considerations and their own conclusions
on GBCA’s proposal,” the Mayor said.
“We are stronger together and we must work together towards the
future. Of course there are still challenges to
overcome for the Southern Downs and Granite Belt to be successful, to grow and prosper.
“We can’t change the past but I believe the issues raised in the
GBCA’s proposal can be resolved without de-amalgamation, and without imposing a
great financial burden on our community - a burden from which our region may
The decision comes following Council’s review of the GBCA’s
proposal, its consideration of the financial analysis undertaken
by Queensland Treasury Corporation (QTC), an independent peer assessment of the
proposal commissioned by Council, and SDRC’s consideration of GBCA’s response
to Council’s Management Review as well as community feedback.
The Department of Local Government Racing and Multicultural
Affairs (DLGRMA) will now consider the GBCA proposal before providing a
recommendation to the Minister regarding referral of the submission to the
Local Government Change Commission (LGCC).
Deputy Mayor and Councillor for Finance, Governance and The Arts, Jo McNally said
Council had confidence in the financial analysis undertaken by QTC.
“I cannot support the GBCA proposal to de-amalgamate because all the
reports before me have allowed me to make an informed decision based on facts
and figures,” Cr McNally said.
“The assumptions put
forward by the GBCA have not been adequately tested or clearly supported with
ample evidence and are not financially sustainable in the long term.”
Once off de-amalgamation costs would be the responsibility of the
new Granite Belt Regional Council (GBRC) and are forecast at $7.09 million. The
ongoing cost impact of de-amalgamation is also forecast at $8.14 million annually,
which would be absorbed by the community as a whole – a significant loss of
opportunity for the entire region.
QTC’s financial analysis forecasts that upon de-amalgamation, an
82% increase in rates and utility charges would be required, of which 48% will
be ongoing for a new GBRC. A number of risks associated with de-amalgamation
were also identified by QTC including a loss of resiliency and economies of
Cr Dobie said de-amalgamation would put Council’s strong financial
position at risk.
“I know the hard work, dedication and effort it has taken this
Council to return our budget to a surplus, to reduce debt and to reduce rates
rises. To support this proposal for de-amalgamation would be to set our region
on a backward path instead of towards growth and prosperity,” Cr Dobie said.
“The GBCA’s proposal highlighted that there are community members
who feel they are not being heard or supported on issues important to them, but
it does not outline how de-amalgamation will solve these issues.”
For more information
on de-amalgamation or to view SDRC’s Management Review, QTC’s Financial
Analysis, GBCA’s Response to Council’s Management Review and the Grassroots
Connections assessment visit Council’s website: sdrc.qld.gov.au.