More than $893,000 was spent on unplanned staff terminations and redundancies as Wingecarribee Shire Council recorded a $707,000 deficit for the 2020/21 financial year.
The unplanned staff redundancies were just one of several contributors to the council's deficit. Other factors also included were:
- A reduction in investments ($688k)
- Cattle throughput at the SRLX down due to COVID ($446k),
- Tulip Time revenue down due to COVID ($400k),
- Unplanned terminations & redundancies ($893k),
- Refunding fees received from Welcome Centre ($121k),
- Independent Reviews and Audits ($115k), and
- Workers compensation insurance premium increases (by $500k to $1.9 mill).
The budget deficit was announced by the acting deputy chief financial officer Damien Jenkins at the October 13 Ordinary Meeting of Council.
Mr Jenkins said that while the general fund reported a deficit, the council maintained a strong cash and liquidity position.
"Council is not reliant on funding from external bodies to fund operations and the council's revenue is adequate to cover loan principle and interest repayments," he said.
"In my opinion, the council is in a sound financial position."
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A Wingecarribee Shire Council spokesperson said the deficit was a combination of the council's three core funds: the general fund, the water fund and the sewage fund.
"When we add these three funds at the end of the year we're left with either a surplus (in black) or as is the case this year a deficit," said the spokesperson.
"In addition to the $707,000 deficit, some other highlights included that the council's net asset position was $1.9 billion and its overall investments had grown to $192.4 million.
"At the next meeting, the 2021/22 Budget will be presented.
"It will be presented as a balanced budget as is normal practice. Quarterly reviews are undertaken to tweak it throughout the year so it (hopefully) remains on track and on budget."
The financial statements for 2020/2021 also revealed a high turnover of staff in Wingecarribee Shire Council concerning the $891,000 spent on unplanned staff terminations.
Mr Jenkins said that while the council was in office, $241,000 was spent on contractual obligations and staff termination and $652,000 was paid out in staff redundancies while under interim administrator Viv May.
It was also revealed that several senior staff had left since Wingecarribee Shire Council was placed under interim administration.
In the meeting, it was confirmed that there was only one senior staff member that had left before the council entering the interim administrative period and that five people under Mr May's administration had left.
A Wingecarribee Shire Council spokesperson confirmed that senior staff who left under Mr May's administration included:
- Deputy general manager for finance and risk Barry Paul
- Deputy general manager for corporate, strategy and development services Mark Pepping
- Group manager for infrastructure services Dominic Lucas
- Group manager for planning development and regulatory services Nick Wilton
- Chief financial officer Richard Mooney
- Legal counsel Ian Lacey
- Acting group manager for organisational development John Burgess
Mr May said it was important for the community to know what the cost of restructuring an organisation was.
"It may not be as high as what a lot of people are saying it is," he said.
The council's general manager, Ms Lisa Miscamble said there were several reasons why the council had recorded an operational loss.
"Some of that is COVID related and the impacts of COVID by way of waiving fees or by reduction of revenue as well as some of the unforeseen expenses that have occurred," she said.
"I'm aware that there has been some discussion around the level of staff turnover and internal vacancies and while it's not unusual to have a higher level of turnover in a period of great change, I think it's important to highlight that in the last few years the turn over percentage at Wingecarribee Shire Council has ranged between 24 and 26 per cent.
"It is high and it has had an impact on the functioning of the organisation."
Ms Miscamble said that the council had prepared and commenced the implementation of an attraction and retention plan.
"We've commenced a cultural change program. We've addressed some long-standing issues relating to internal communication. We've increased flexible work practices in part driven by COVID and in part driven by the organisation," she said.
"In the future, we will also be growing our own through partnerships with tertiary institutes as well as more proactive workforce management as our workforce ages and moves to retirement."
A Wingecarribee Shire Council spokesperson said that as of October 12, 2021, there were 49 vacant positions within the council. As of October 15, 2021, a 26.9 per cent turnover of staff was recorded in the calendar year.
It is an increase of 2.69 per cent from the previous calendar year, which recorded a 24 per cent turnover of staff.
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