One of the state’s largest councils is in financial crisis, with Central Coast Council revealing that it lacks adequate cash to pay the wages of more than 2,000 employees this week unless it receives an urgent loan or assistance from the NSW Government.
The United Services Union has today lodged urgent proceedings in the NSW Industrial Relations Commission seeking an intervention to ensure workers are paid.
The council, formed in 2016 following the forced amalgamation of Gosford and Wyong councils, is blaming the combination of COVID and natural disasters for a massive $89 million budget deficit.
The council, which is today holding its third extraordinary meeting in as many days, has tasked the Acting CEO with urgently seeking a commercial loan or overdraft to provide emergency funding. The council has also written to Local Government Minister Shelley Hancock seeking permission to borrow from restricted funds to make staff payroll.
The current crisis follows recent revelations from the NSW Audit Office that council had breached the law by spending more than $13 million collected in developer contributions on administration costs between 2001 and 2019.
The USU said the NSW Government must immediately intervene to ensure the financial viability of Central Coast Council, ensuring wages are paid and services continue to operate.
“Workers are rightly shocked and concerned by revelations that Central Coast Council’s financial crisis has escalated to the point that there isn’t enough money available to pay wages this week,” USU General Secretary Graeme Kelly OAM said.
“This is a truly extraordinary situation. It is something you might see in an impoverished developing nation, but it should never be the case at one of the largest councils in NSW.
“The NSW Government implemented the merger that created this council in 2016 and they have a moral obligation to the Central Coast community to ensure its ongoing financial viability.
“Rather than being forced to negotiate an urgent commercial loan or to dip into restricted funds — in breach of the Local Government Act — Central Coast Council should be provided urgent financial assistance from the NSW Government to ensure wage and service costs can be met.
“While COVID, fires and storms have all resulted in substantial financial pressures, the revelations that council had been dipping into developer contributions for nearly 20 years highlights that the current crisis is at least partly the result of long-term mismanagement.
“It is simply unacceptable that the more than 2,000 council employees who tirelessly serve their local community should face going unpaid this week because of the actions of management or the failure to by the NSW Government to act.”