19 October 2022

Call for public accountability as Snowy Valleys Council tables $21m net loss

| Edwina Mason
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Save Tumbarumba Shire community group has demanded Snowy Valleys Council attend tonight’s public meeting. Image: Save Tumbarumba Shire.

The community of Tumbarumba is in crisis mode with an urgent public meeting called for tonight to discuss performance and losses incurred by Snowy Valleys Council (SVC) in the last financial year.

Triggered by the release of the council’s annual financial statement, the long-standing anti-merger group – Save Tumbarumba Shire – has demanded the entire council front tonight’s gathering to explain a net operating loss of $20.73 million over the past 12 months.

Group spokesman Dr Neil Hamilton said the report was published in council’s upcoming 20 October meeting business paper, revealing that in the 2021-22 financial year SVC incurred a loss of $6.98 million (including capital grants), and a loss of $20.73 million (excluding capital grants).

Dr Hamilton said the council’s current operating budget was less than $60 million.

“So their loss this year is more than 33 per cent of their income,” he said. “In short, they are insolvent, and out of control.”

Dr Hamilton said council’s cash reserves were somewhere less than $4 million but he suspected the number was possibly closer to $2 million.

“They were forced to borrow from restricted employee leave entitlement reserves to meet their statutory requirement level at the end of the financial year,” he alleged.

“I could go on,” he said. “These almost unbelievable levels of losses follow a continual succession of multi-million operating losses (each and every year) since amalgamation.”

Concerns around council’s revised management structure have also been raised after the loss of five senior executives, including CEO Matthew Hyde, this year.

Dr Hamilton said SVC had opted for a two director model to help with recruitment and save costs.

“So why did Matt Hyde need so many executives when it was well known then, that SVC was losing multiple millions every year?” Dr Hamilton said.

Snowy Valleys Council (from left) Cr Mick Ivill, Cr Sam Hughes, Cr Julia Ham, Deputy Mayor Trina Thomson, Mayor Ian Chaffey, Cr Hansie Armour, Cr James Hayes and Cr John Larter. Not pictured Cr Brent Livermore. Image: Snowy Valleys Council.

Dr Hamilton said community leaders would ask councillors to explain the situation, justify their actions, and why they should continue in their roles.

Snowy Valleys Council was formed in May 2016 as the result of the forced merger of Tumut and Tumbarumba Shire Councils by former NSW premier Mike Baird and then NSW local government minister Paul Toole who mandated that 44 existing NSW councils would be forcibly merged into 20 mega councils resulting in a hoped-for $2 billion in savings for the state over 20 years.

In February 2020, after years of agitation and protests from demerger groups such as Save Tumbarumba Shire and Gundagai Council in Exile, the new minister for local government Shelley Hancock asked the state Boundaries Commission to examine proposals to demerge the Snowy Valleys and Cootamundra-Gundagai regional councils.

When the commission held hearings in those areas last year, the public submissions were overwhelmingly in favour of demerging, but boundaries commissioners were divided on both proposals.

The commission formally recommended the proposal to demerge Cootamundra-Gundagai Regional Council (CGRC) not go ahead, but there was a dissenting report from two of the commissioners recommending the opposite.

The commission formally supported the proposal for SVC to demerge, but one commissioner dissented.

This ambiguity gave the minister enough ammunition to reject both proposals in July 2021, and instead call for an independent statutory review of the LGBC.

A business case supporting a demerger of CGRC was referred to the LGBC in August 2021 and their subsequent investigations and recommendations resulted in the August 2022 announcement supporting that demerger by incumbent NSW Local Government Minister Wendy Tuckerman.

SVC has since unanimously voted to demerge, arguing it would, “reduce the financial burden and any further risk to the emotional health of the … community”.

Just last week they confirmed they had written to the Minister for Local Government requesting the previous recommendation of the LGBC to demerge SVC be upheld.

Dr Hamilton said that, given the financials and concerns around management, that wasn’t enough and the community needed to intervene.

“The community has been dragged through the mud by the NSW Government for year after year after year,” he said. “It is now time that someone is held accountable for the demonstrably destructive actions that now threaten the future of all the communities of Snowy Valleys.”

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