Surf Coast Shire draft budget predicts $18m loss as it rolls out record capital works program

Surf Coast Shire will lose more than $18m over the next financial year, as it looks to roll out a record capital works program.

Surf Coast Shire CEO Robyn Seymour. The shire expects to lose $18m in 2023-24, according to its draft budget to be considered April 26.

Surf Coast Shire will lose more than $18m over the next financial year, as it looks to roll out a record capital works program.

The draft budget, seen by the Geelong Advertiser and set to be considered on April 26, reveals the shire’s expenses will exceed the surplus predicted in its previous budget, a difference of more than $25m.

The announcement comes as municipalities across the region struggle financially, with the City of Greater Geelong recently announcing an operational deficit of more than $8m.

Much of the additional Surf Coast costs – $15.4m – come as the shire moves assets including land parcels, to the Great Ocean Road Coasts and Parks Authority.

Inflation and cost-of-living pressures have also put pressure on the shire, with the council prioritising certain services, projects and initiatives, while pressing pause on other projects.

One project given priority is the renewal of Winchelsea pool, which has been allocated $4.6m, Surf Coast Shire chief executive, Robyn Seymour said.

“Given this is an $8.5m project, we need to press pause on renewing a number of our other ageing assets – from roads and pathways, to buildings and recreation,” she said.

“They remain safe and usable, but we’ll time their renewal in future years based on condition.”

However, Ms Seymour remained “pleased” with the shire’s long-term financial health, with the shire’s debt planned to shrink over the coming years.

“We’re pleased that in this challenging economic environment, we continue to achieve our financial savings target,” she said.

“It contributes to our long-term financial sustainability, which includes addressing our asset renewal backlog and catering for population growth when delivering our core services.

“We want to maintain existing assets to the standard residents expect, but rising construction costs are constraining our capacity to tackle a wide variety of projects.”

After budgeting a deficit in 2023-24, the shire’s modelling predicts a $17m surplus in 2024-25, followed by a mammoth $56m surplus in 2025-26 and a smaller $10.2m surplus in 2026-27.

The large surpluses in 2024-25 and 2025-26 are due to increase in capital grant funding thanks to the planned construction of the Surf Coast Aquatic and Health Centre.

The draft budget proposes a record $36.4m capital expenditure program, $16.3m of which is allocated to new projects.

A $5.8m allocation to the Surf Coast Aquatic and Health Centre is the largest single spend.

The draft budget also proposes a rate rise in line with the Victorian government’s rate cap of 3.5 per cent.

This, it was noted, was well below inflation levels, which reached 7.8 per cent in the December 2022 quarter, with inflation “rising faster than council’s revenue base”.

Ms Seymour said that the shire understood cost-of-living pressures affected everyone, and the rate rise might impact residents.

“Rate revenue is vital in supporting the community and meeting its needs, both now and into the future,” Ms Seymour said.

“We understand that many residents are experiencing financial pressures, so if you are, please reach out to us as we have rates payment plans available to support you.”

The draft budget will be considered at Surf Coast Shire Council’s general meeting on April 26.

Originally published as Surf Coast Shire draft budget predicts $18m loss as it rolls out record capital works program