As a career fund manager, stockbroker and farmer, I understand that good companies populate their boards and senior leadership positions with persons with experience and qualifications in Financial Management. Scenic Rim Regional Council (SRRC) is a large Council with nearly 1.2 billion dollars in assets and an annual operating budget of 100 million dollars.

Financial Management and leadership are sorely lacking at SRRC, as evidenced by exorbitant rates, the need to use consultants for almost everything they do, constant project failures, cost blowouts and mounting unsustainable legal costs. It has a culture of ticking the box on consultation and high spending on self-promotion with glossy websites and brochures. It has a toxic culture and declining customer satisfaction levels. 

Its financial statements do not reflect the waste inefficiency and poor decision-making. It is not in the public interest to hide spending, never apologise, make it hard for the media to get answers, or gag Councillors from talking to their ratepayers. 

The answer to poor financial performance is not constantly raising rates above CPI and borrowing more. The solution is not to run existing assets into the ground by neglecting maintenance and not looking after the one billion dollars of assets the community already owns. 

Evidence of Poor Budget Performance and Process  

·    Many communities in the Scenic Rim have the highest rates in Queensland.

·    Surrounding Local Government’s rates are often half that of Scenic Rim rates. 

·    The Council Budget process is flawed. Councillors complain about it but are impotent in standing up to the bureaucracy and having more effective input into the process. 

·    Financial skills and ideas to cope with a strong bureaucracy, that has its own priorities and agenda, are lacking. 

For example, things to watch out for in budgets:

·    More staff positions if existing positions haven’t been filled.

·    Excessive use of consultants when existing staff remuneration should account for these outsourced works. 

·    Using project management companies because they find it easier not to do it themselves. 

·    Early upgrades to the latest and shiniest phones, computers, and office systems for no new tangible benefit.

·    New computer software, when previous purchases have not been implemented correctly and the promised benefits realised. 

·    Depots and administration buildings being prioritised over more pressing community infrastructure. 

·    Having the most up-to-date fleet of trucks and equipment, but when utilisation falls below industry standards. 

·    Tens of MILLIONS OF DOLLARS of unspent money each year that will never be spent but is asked to be provided again in next year’s budget. 

·    Increasing employee benefits, that increased by 1.2 million dollars last financial year.

·    Although the Council, for the first time, has attempted public consultation on the budget, it has not been successful, and many improvements are necessary, like increasing disclosure, making more information available and using Councillors to provide feedback from their constituents about their community’s needs and wants. 

·    The organisation must demonstrate its efficiency and effectiveness before generating community trust in spending budget funds. 

·    A large percentage of expenditure is done by delegated authority and under procurement policy, which is outside the scrutiny of Councillors or the public. 

The Solution

·    Budgets must be broken down into achievable outcomes, funds allocated to specific capital projects, and operational outcomes that are measurable, accountable, and reported on. 

·    There must be more information to the public explaining why budget decisions are made and how much they will cost ratepayers. 

·    A good CEO will challenge his/her Directors and Managers to make capital and operational changes that optimise performance of the ratepayers’ dollar. There is no indication this has ever occurred at Scenic Rim, from insiders’ reports. The only way structural budget resetting can be done is not by the Councillors themselves but by asking or resolving the CEO to do this.

·    There must be audit processes put in place to ensure that tendering and quoting are done to a high level of integrity and that ratepayers get maximum value. 

·    Councillors are the community-chosen representatives and should be able to make enquiries or use the same IT and Financial systems as Council staff to enquire about funds received or spent by the organisation by their power to be accountable for its performance. 
 This is a minimum requirement of transparency and accountability. 

·    The Media should be able to make financial enquiries of the Council and receive honest answers; after all, it’s the ratepayers’ money, not theirs. 

·    Through his/her employment contract and KPIs, the CEO must demonstrate to the public that through his/her management and decisions, the organisation and its budgets have the ratepayers and community at its heart, not the Administration. It is the responsibility of Councillors to understand they work for the Community that elected them and that they are not employees of the organisation or apologists for it. 

·    High-functioning councils and High-functioning leadership ensure the community grows and prospers and Customer satisfaction increases.

If elected Mayor, I aim to bring about transformational change to the Scenic Rim Regional Council through experienced, sound financial management and vision. I’m sure my views received to date through liaison with community organisations, local businesses and house-to-house doorknocking, that we are a long way off what the Community expects.

www.tomsharp.com.au