General Manager Phil Pearce has told councillors he wants to cut $19-million worth of services over two years to get Newcastle Council out of financial trouble.
He would also install entry fees at the new museum and Fort Scratchley as part of a draft 10-year financial plan.
“I have indicated since my arrival to council that major changes to the city’s finances are needed and have been reinforcing this message for more than 12 months,” Mr Pearce said in a statement.
Newcastle Council lost $11.5-million last financial year, a figure which the council has long claimed had nothing to do with an unexpected and expensive battle removing the Laman Street fig trees.
The plan, unveiled tonight, did not rule out future job cuts, and there are plans of a special rate rise of 7 per cent in the 2017/18 financial year.
A council statement said managers are now being briefed on the situation, and would be asked to nominate areas of savings.
The final plan will be presented to councillors at the start of next year.
COUNCIL STATEMENT
Summary of recommendations in the draft long term financial plan with projected savings over 10 years
Organisational efficiencies and savings
Council is implementing an integrated software system to improve all of its business processes to save $17.6m
Targets for energy savings, changes to business practices and implementing simple technology to save $6.2m
5% budget cuts over the first two years of the plan to services and operations with an annual saving of $9.5m in the first year and $9.5m in the second, culminating in a total saving of $189.7m over 10 years
Maintenance savings and capital raising from asset disposal raising $5.3m
Improved performance of commercial venues over 10 years
Increase City Hall revenue by $10.8m
Increase Civic Theatre revenue by $2.2m
Dividends of $23m from the Newcastle Airport
$2.5m raised from entry fees applied to Fort Scratchley, the Museum and Art Gallery
Increase Summerhill Waste Management Centre revenue by $5.1m
Special Rate Variation
A Special Rate Variation of 7% is proposed over a five year period from 2017/18 to raise $24.8m.
Service Unit Managers are now being briefed and will be required to nominate where the 5% savings to services and operations can be made.
If Council accepts the proposals being prepared, this will result in reduction to services and/or the cessation of services. The extent of these reductions is yet to be determined. This information will be presented to Council late in the first quarter of 2013 for their further consideration.
Any changes to staffing levels will be addressed responsibly and in line with relevant legislation and our Enterprise Agreement.
The draft plan provides Council with a proposed framework to overcome its current financial impost and provide a pathway to ensure its financial sustainability and relevance into the future.
