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Home»COVID-19»Budget blown by pandemic
COVID-19

Budget blown by pandemic

By Stephen TaylorMay 18, 2020Updated:May 19, 2020No Comments3 Mins Read
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EARLY financial modelling suggests Mornington Peninsula Shire Council’s non-rate income could be down $6-$12 million this year depending on the duration of the COVID-19 restrictions.

To help ease the shire’s financial pain, the mayor Cr Sam Hearn has opted to take a 20 per cent cut in his $90,000-plus allowance. CEO John Baker has also said he will take a pay cut.

Cr Hearn said the shire was “continuing to monitor and make prudent budgetary decisions in response to the impacts” of the pandemic.

“We are committed to leading from the top in managing the financial challenges of this crisis,” he said.

“We are cutting costs and ensuring that every dollar the community entrusts us with is invested in helping the peninsula bounce back from COVID-19 and providing the essential services our community needs.

“I’m personally committing to a 20 per cent reduction in my allowance for next financial year [from July until the council year ends in November] and our CEO [John Baker] has initiated a substantial reduction in his own wage.”

Mr Baker’s annual salary is $360,000 – $380,000.

The shire derives about 70 per cent of its income from rates and charges, so it is less vulnerable than inner city municipalities to reduced income from, say, parking fees.

Cr Hearn said ways in which the council was cutting expenditure included implementing a business support package “that has already put half a million dollars back into the business community”, through a business concierge service, a “supporting-local-business” campaign, by fast tracking approvals and compliance matters, by temporarily scrapping fees and charges, by hiring peninsula-based contractors and introducing rate-and-rent-relief options for tenants in council properties.

“Council moved quickly to look after vulnerable and isolated citizens by implementing a caring for our community initiative that has seen the delivery of over 2000 care packages of food and essential items throughout our community,” Cr Hearn said.

“Other measures include saving $1.4 million by not filling vacant staff positions and saving $1.7 million by reducing materials and services expenditure.”

He said the council was also continuing to lobby state and federal departments for financial support and relief.

Financial modelling and “scenario analysis” for the 2020-21 budget forecasting the potential $6-$12 million loss is being undertaken while the draft budget is on public exhibition.

Cr Hearn said the exhibition period had been extended to Thursday 21 May to “give the community more time to review and provide comment, and to give council officers more time to assess the economic impacts we are seeing from COVID-19”. He said the next financial year would be “very challenging”.

“We as a council have a united resolve to navigate our way through these difficult circumstances for the whole community,” he said.

“I believe we can facilitate a united effort engaging all sectors and people, peninsula-wide, to achieve our economic and social recovery and ensure no one gets left behind.

“I’m proud of the way we have stuck together and looked after each other through the pandemic. We need to commit to doing the same as we rebuild and restart after it.”

The proposed budget can be seen at mornpen.vic.gov.au. Hard copies can be mailed on request.

First published in the Southern Peninsula News – 19 May 2020

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