Toowoomba council on track for higher deficit by June 30 as key departments fail to curb spending

The forecasted council deficit mayor Geoff McDonald hoped to “claw back” is now expected to be even worse, with bureaucrats to hold meetings this week to curb ballooning spending figures.

The Toowoomba Regional Council’s top bureaucrats will hold “dedicated” meetings around growing spending this week after the organisation revealed its deficit was set to balloon to nearly $6 million by the end of the financial year.

Corporate services general manager Ann-Marie Johnston revealed the re-forecasted budget result at Tuesday’s ordinary meeting, showing a structural deficit of $5.949 million driven by the council’s inability to cut operational expenditure.

This is an increase from the $5.7m deficit outlined in the revised budget back in March, something mayor Geoff McDonald said the organisation was “trying to claw back” by the end of next month.

Ms Johnston said the executive leadership team would meet this week to discuss the result and try to minimise the deficit prior to June 30.

“We have been reporting since January that we’re looking at another deficit on June 30, so our operating expenditure is higher than our operating income,” she told councillors.

“Councillors will recall we had an operating deficit actual result at June 30 last year in the ballpark of $12 million, so it’s not sustainable (for) our expenditure to be higher than operating income.

Finance and business strategy general manager Ann-Marie Johnston addresses councillors during a meeting to discuss the future of Toowoomba City Aerodrome (also know as Toowoomba Airport), Tuesday, May 28, 2024. Picture: Kevin Farmer

“I can assure councillors that the executive leadership team are having a dedicated meeting this week to review all expenditure across the organisation to try and reduce that deficit.”

No councillors had questions for Ms Johnston following her presentation.

According to the financial performance statement for the year ending April 30, the slight uptick in the projected deficit was due to “not achieving reductions” across a number of departments.

These included governance and legal services, financial services, information, communications and technology, parks and recreation, and fleet and logistics.

The council is also expected to spend more than $4m on “expensed capital” out of its operational budget, something it had not budgeted for at the start of the financial year.

One of the elements not putting pressure on the operational budget is labour, with the council projecting actually a reduction in staffing costs (from revised $136m to $134m).

As of April 30, the council has 278 job vacancies.

Despite the projected deficit on June 30, the council says it has nearly eight months’ worth of unrestricted cash, reporting reserves of $225m against $204m worth of borrowings.

In another major concern, the TRC has failed to hit a key metric around asset management every month of the current financial year.

The organisation is set a target by the Queensland of spending 60 per cent of its capital works budget on renewing older assets, however this actual month-to-month figure has sat around 30 per cent.

A snapshot of key Toowoomba Regional Council metrics as of April 30, 2025.

The potential need to funding the full cost of the $266m Cressbrook Dam safety upgrades also threatens the council’s long-term financial sustainability, with nearly $20m spent on its delivery so far in 2024-25 (worth 27 per cent of the total project).

The council looks unlikely to meet its revised target for the 216 projects in its capital works program for the financial as well.

After revising its capital works budget to $167m earlier this year from the original $231m, the TRC was supposed to have carried out $137m in works by April 30.

This actual figure is just $115m, with the council forecasting its capital works program would only hit $159m by June 30.