Council is reporting a projected consolidated $8.1 million operating surplus for the year ending 30 June 2026 at the January to March quarter, almost doubling the projection of $4.1 million at quarter two.
Contributing factors include salary savings and reduced materials and services driven by lower legal costs, waste levy, and natural disaster projects delivered under budget.
Director City Performance Katie Buckman said Council's unrestricted cash position at quarter end also grew, increasing by $7.4 million to total $15.3 million. However, due to commitments to expenditure anticipated in the final quarter of 2026, the expected unrestricted cash balance will remain stable in quarter four and likely sit just shy of $16 million by the end of the financial year.
"The quarter three results reflect the efforts of our staff, who have managed ongoing organisational change and growing project demands while keeping a strong focus on financial discipline," Ms Buckman said.
"The improvements we've made to financial practices and accountability over the past two years are now clearly translating into better outcomes for Council," she said.
"I'd like to thank staff and Councillors for working collaboratively to turn things around."
The March quarterly review has identified further improvements in the projected General Fund deficit, from $14 million to $9.8 million. Despite a rise in fuel costs due to global oil prices, no changes are needed to the fuel budget this year, with current funding expected to cover rising costs.
The Water Fund remains in a projected surplus position, although a faulty water meter has reduced the expected result. An over-reading meant Shoalhaven Water received less revenue than anticipated, lowering the surplus before capital from $5.5 million to $4.6 million. Council's Sewer Fund results saw projections increase from $15.0072 million last quarter to $16.3 million this quarter.
It is noted that debtor write-offs and capital works in progress write-offs (amounts considered unlikely to be recovered) are expected to occur in the fourth quarter and have not been included in this quarter's budget projection. These write-offs will negatively impact Council's operating result for the 2025-26 financial year but will have no effect on Council's projected cash balance, as cash projections are not impacted by write-offs. The write-offs will be reported following completion of the audit in October 2026.
The Quarterly Performance and Budget Report was adopted at Council's Ordinary Meeting on Tuesday 26 May. Find the full report on Council's website.
