Penrith Council to recommence chasing rates debts

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Being financially impacted over the last few years, Penrith City Council is working towards strong financial management, including chasing overdue rates to gain income.

In accordance with guidelines, Council staff prepared the 2021-22 Financial Statements which were referred to the Audit Office of NSW and then placed on public exhibition, a process that received no submissions.

A report to Council completed the final stage of the process which noted that the Rates and Annual Charges Outstanding percentage of 5.2 per cent is now above the benchmark of five per cent.

“The pre-COVID June 2019 result was 3.37 per cent and the amount has continued to increase during the pandemic,” it stated.

“This increase is predominantly attributed to Council’s compassionate approach to debt recovery during the pandemic and during the recent flood events, including a pause in taking legal action against ratepayers with significant overdue rates.”

A recommendation that the Councillors adopted at a recent Ordinary Meeting will see a recommencement of debt recovery processes to manage operational management.

“It is intended that debt recovery processes will now revert to the pre-pandemic processes, including the recommencement of legal action in March 2023, after the third instalment due date,” the report said.

“The recommencement of legal action will be in line with most other councils who have recommenced such action.”

It acknowledged that while cost-of-living increases add to the pressure ratepayers face, it is not in their best interest for their rates debt to increase.

It said that Council will still continue with a compassionate approach when ratepayers make contact to see assistance.

A separate report in the same business paper outlined Council’s progress towards implementing its four-year Delivery Program for the first quarter period of July 1 to September 30, 2022.

Projecting a balanced budget in the adoption of the Original 2022-23 Operational Plan, it documented that the September quarter presented some variations.

A positive variation was Council receiving its 2022-23 Financial Assistance Grant entitlement which was $386,413 more than originally budgeted for the General component.

Vacancies across departments led to a net salary savings of $158,391 and the NSW Government has continued for a third year to cover the increased costs of the Emergency Services Levy.

Losses were recorded when it came to library income as visitor numbers have decreased since COVID and inflated costs for the Cooks and Banks cricket practice facility upgrade have affected the budget.

Despite ongoing challenges, the mostly favourable variations resulted in a surplus.

“It is proposed as part of the Review to transfer the first quarter surplus of $593,170 to the Financial Management Reserve. This allocation will provide capacity to respond to any current and emerging priorities, including some of the priority resource requests and results in a balanced budget position being predicted for 2022-23,” the review said.

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