Council lost sight of staff numbers

WHILE Perth city council’s staffing costs soared to unprecedented levels last year, its executives couldn’t even tell how many employees they had.

An accounting consultant commissioned by the official state government inquiry into the council appeared at public hearings last week and said nearly half the PCC’s total expenses last year were taken up by staffing costs. 

“The City of Perth’s labour expenditure has been growing at a much faster rate of growth than any other jurisdiction,” John Nicolaou told the inquiry.

But Mr Nicolaou said because the council couldn’t tell him how many staff it employed, he couldn’t tell if the increasing costs were from having more employees or from increasing wages.

Key input

“[Staff numbers are] a pretty key input into any budget setting and it’s an important indicator of the efficiency or otherwise of how an organisation’s running,” he said.

Mr Nicolaou had been asked to report on council finances between 2011 and 2018 and said during that time its position had “deteriorated” as the expenses closed in on its cash reserves.

When commissioner Tony Power asked Mr Nicolaou whether this should have prompted someone to query the exact “head count” at the council, the economist agreed but noted that the sheer amount of parking cash flowing into the council had masked the emerging problem.

Mr Nicolaou also told the hearing the city didn’t have a business plan for its parking operations for years, despite requiring one by law.

When that was discovered in 2017, he said the resulting business plan was best described as an inadequate “brochure”.

Commissioners standing in for suspended councillors signalled in June this year they’d be weaning the city off parking income, confident it was viable now the council was running more efficiently. A proper business plan for on-street parking is in the pipeline.

Former council corporate services director Robert Mianich also appeared at last week’s hearing, where he was grilled over a letter from current CEO Murray Jorgensen criticising the Corporate Business Plan he’d prepared for the city.

Mr Jorgensen complained the plan “contains no financial projections” and no information about the council’s long-term financial position.

“[That] may be appropriate for a small, unsophisticated shire; a business plan that does not contain any financial information is clearly not appropriate for a large undertaking such as the City of Perth, turning over some $200 million per annum,” Mr Jorgensen wrote.


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