Central Coast Council is ending its four years under administration in a strong financial position, with a reduction in debt of $150M from when it was put under administration. 

Council’s debt at the commencement of the administration period was just under $350M, due to having to take out two emergency loans, it now sits at less than $200M. 

Council Acting CEO, Marissa Racomelara said Central Coast Council was put in administration because of inadequate financial management leading to a financial crisis. In response, during the period under administration, the focus has been to repair Council’s financial settings and the associated processes.

“As well as delivering the Financial Recovery Plan, over the last two financial years Council has significantly improved its financial processes and delivered financial statements that satisfied audits undertaken by the NSW Audit Office and were completed within the legislated timeframe.

“Council has progressively turned annual operating losses in appropriate surpluses. This means that Council ‘s performance favourably exceeds one of the most important indicators of Council’s financial health,” Ms Racomelara said.

During 2023-2024, Council contained expenditure within the income that was available, whilst delivering services and projects to the community and ensuring that the organisation was able to absorb any adverse financial impact that arose during the year.

“As a result of this prudency, Council has achieved an operating surplus of $38.6M. Over the last three financial years we have accumulated surpluses totalling $114M. 

“While this is still short of the more than $160M in losses accumulated over the three preceding financial years, our focus going forward is achieving sufficient surplus to make up the gap, and to remain sustainable into the future.”

Ms Racomelara noted that in addition to achieving a good operating result, Council has also managed its cashflow well. 

“During the year we have repaid more than $100M of borrowings, including one of the emergency loans taken out during the financial crisis. At the same time, we were able to draw down the first $10M to deliver the upgrade of the Mardi Water Treatment Plant project. 

“This project is a good example of good debt. This project will benefit many generations to come, so spreading the cost over many years by borrowing is the fair approach to take.”

Central Coast Council Administrator Rik Hart said he is very pleased that Council’s financial position is a positive one.

"It’s gratifying that the Financial Recovery Plan we put in place in late 2020, following four years of loss, has achieved all its milestones and Council’s financial position has been successfully restored.

“During the last financial year, we added more than $360M to the value of our community’s roads, drainage, buildings, and water and sewer infrastructure assets.

“We have invested over $170M in renewing our community’s assets, to keep up with deterioration occurring during the year, as well as addressing shortfalls in renewal expenditure accumulated over earlier financial years. 

“As well, over the last three years, we have increased the proportion of assets that are in the required condition, reducing the backlog from 2.62% to just over 2% of the value of Council’s assets. 

“Notwithstanding the continued expenditure on renewing and replacing assets, like most councils, we do face the challenge of consistently maintaining a proactive maintenance approach for all assets. 

“Council has been often criticised about what assets are upgraded and when, particularly where roads are concerned – it is natural that residents want their roads or community facilities upgraded first.

“However, as has been explained many times, we maintain assets based on a priority basis driven by risk and limited resourcing, while balancing other expenditure areas that are important to our community. 

“The incoming Council will also need to understand this and will need to continue to engage with Central Coast residents to help them identify the programs and services that are most important to our community, and prioritise resources accordingly,” Mr Hart said.

Council’s cash position remained strong in 2023-2024. As at June 2024, Council had total cash of $773M, with most of this cash restricted or set aside for specific purposes, leaving $104 million in unrestricted cash.

“Council had an approximate debt of $565M by late 2020 and is now at a healthy level, repaying the loans whilst Council continued providing services and investing in infrastructure.

“As Council continues to manage its financials in a responsible manner and its financial position continues to improve, I am confident that along with a strong CEO and Executive Leadership Team, the groundwork is in place for the incoming Councillors to make sound decisions that propel this Council forward.

“As I conclude my time as Administrator I am also confident that, through the checks and balances now in place, Central Coast Council will be able to continue to deliver on its Delivery Program, Operational Plan and Long-Term Financial Plan.”

View the  Administrator’s Final Report