Qld Audit Office reports on Gympie council financials

Gympie Regional Council’s financial health is not terminal, but it’s still not good, according to the latest report handed down by the Queensland financial watchdog

Gympie council CEO Shane Gray says the council is working to fix the financial issues identified by the Queensland Audit Office in its latest report, which flagged concerns about the council’s long-term ability to renew assets like Gympie’s sewage treatment plant thanks to continued operational losses.

Gympie Regional Council’s long-term financial health remains on shaky ground thanks to continued operating deficits putting it risk of being unable to renew the region’s assets.

Assets include things like bulldozers and other plant, pools, roads and sewerage systems.

The Queensland Audit Office has kept the council rated a “moderate” risk of becoming financially unsustainable in the long-term thanks to repeated operating deficits, including a $4.34 million shortfall last financial year and a $14.5 million gap in 2018-19.

The council’s average operating ratio (the measure of its operating surpluses or deficits for the past five years) is -5.6 per cent, well below the 0-10 per cent ideal target.

It has recorded only one surplus since 2015.

Gympie council’s continued operational deficits have dragged its long-term financial sustainability into question.

The QAO’s assessment of Gympie council’s financial governance, which last year flagged problems with internal controls and the quality of the council’s draft financial statements, remains unchanged.

Chief council financial officer David Lewis said one of the issues identified by the QAO was caused by the council handing out a loan without getting Queensland Treasury approval.

CEO Shane Gray said the council has put processes in place to ensure this did not happen again.

The continued murkiness of its financial security comes amid wider concern about the state of Queensland’s local government sector in the wake of the COVID pandemic.

The report reveals a third of the state’s councils are at elevated risk of experiencing future financial strife.

CEO Shane Gray says the council has addressed the problems identified by the Queensland Audit Office.

Mr Gray did not expect Gympie council to follow this same path.

“We’ve spent the last nine months righting the ship … there’s no doubt we were heading the wrong way but we’ve done a lot of work in the meantime to get us back on track,” he said.

Mr Lewis said the council had its eye on having its operating result back above the line by 2024.

“The only issue we have is around our operating result; we’re actively addressing that at the moment.

“We’re hoping to, within the last two terms of this council, be back in to an operating surplus.

“That’s the financial plan at this time.”

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Originally published as Qld Audit Office reports on Gympie council financials