Brisbane households warned of rate rises amid $127m council revenue slump

Brisbane households will learn next month how much their rates will rise after Lord Mayor Adrian Schrinner confirmed a “concerning” $127 million council revenue slump.

For the first time, Brisbane City Council has taken a $100 million line of credit from Queensland Treasury Corporation after the council’s cash reserves fell from $500 million to $50 million.

A building and construction slowdown has contributed to council’s $127 million revenue shortfall. Credit: Dan Peled

The cash advance will enable council to cover immediate increases in project costs, having already covered an additional $222.9 million in costs for the Brisbane Metro.

Schrinner told a council meeting on Tuesday the biggest problem for the budget – to be handed down on June 12 – was that “builders are not building”.

Council receives a range of fees from builders and developers and uses the revenue to offset the need to raise other rates, fees and charges.

“This is a real issue, and it is having a real issue on the council’s budget,” Schrinner said.

Lord mayor Adrian Schrinner – pictured with his deputy, Krista Adams – says Brisbane City Council has received $127 million less in revenue than expected.Credit: Cameron Atfield

“More than $40 million of the $127 million in reduced revenue to Brisbane City Council is linked to reduced building or development activity.

“So, at a time when we have a housing shortage, we are seeing lower than anticipated construction activity. So that is obviously concerning.”

Council is waiting on $42 million from the Queensland Reconstruction Authority for flood repairs and $9 million in federal grants. At the same time, it had to pay out an extra $20 million from its home-buyback scheme.

The Labor opposition questioned Schrinner over $430 million in spending cuts announced ahead of the council elections, and whether Brisbane ratepayers would be hit in the next budget.

Council opposition leader Cr Jared Cassidy questioned why Brisbane’s cash reserves had dropped from $500 million to $50 million.Credit: Matt Dennien

Opposition leader Jared Cassidy said the council would be exposed to a budget blowout if a natural disaster hit.

“What we are seeing is ratepayers being slugged more,” Cassidy said.

“Obviously, there is less developer money coming in, but there is a lot more ratepayer money coming in.”

Schrinner reiterated that increasing the supply of housing must be the priority of all three levels of government.

“The signs of new growth that we were hoping for are not appearing, and in fact, there is less growth and less building than we were hoping for,” he said.

The opposition argued council’s own finance committee report showed the economic challenges were broader than those attributed to the building slowdown.

Cassidy questioned why Brisbane’s road network had depreciated by “hundreds and hundreds of millions of dollars”.

“What that means, in laymen terms, is that council’s assets are getting so old and so long in the tooth, and it has been so long that upgrades have happened, that the budget on writing off old assets is reaching hundreds and hundreds of millions of dollars,” Cassidy said.

He said the finance committee report showed project cuts in 2024, 2025 and 2026.

“I’m pretty sure that by the time we get around to the fourth quarter in the budget, the lord mayor will be asking councillors to go out and run chook raffles in local pubs to meet the shortfall.”