NSW councils to rein in spending

By Staff Writer

Local councils in New South Wales will be required to develop 10-year financial plans under draft legislation released by the State Government today.

Under the proposed changes, each council will be required to develop a strategic plan setting out its priorities for the next 10 years; an action plan showing how these priorities will be delivered during the council’s four-year term; and an operational plan showing how the revenue will be obtained to fund the projects.

They will also have to develop a strategy outlining how they will manage resources, including property, investments and personnel.

At the end of its four-month term, each outgoing council will have to demonstrate how it has implemented its long-term plans.

Local Government Minister Barbara Perry said the new laws aim to encourage all councils to put in place “hard-headed” financial planning and reporting systems.

Developers have welcomed the draft legislation that will prevent councils from signing up to projects they cannot afford.

The Urban Taskforce chief executive Aaron Gadiel said the new rules will encourage councils to stick to “core business” instead of pursuing risky development projects.

“Some local councils have been a bastion of financial irresponsibility,” Gadiel said.

“Councils need to concentrate on community amenities, such as long roads, bridges, footpaths, kerbs and gutters, playgrounds, bus stops and drainage infrastructure.

“They need to avoid grandiose schemes and risky business ventures that they simply cannot afford.”

Councils are entitled to make submissions to the Department of Local Government on the draft legislation by Friday 12 June 2009.

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