Alarm bells?

HOPEFULLY your story about Bayswater’s budgeting problems (“Probe into Bayswater budget gap,” Perth Voice, April 30, 2022) will ring some alarm bells at Vincent council.

I believe that Vincent’s financial management is the worst it has been in 20 years, and desperately needs forensic investigation.

At this year’s Annual Meeting of Electors a resident asked why Vincent has had a deficit budget for a number of years. Neither the CEO or the responsible director provided an acceptable explanation, simply saying they hoped to have a balanced budget soon.

The reality is that the so called 

‘deficit’ is offset by money carried over from previous years, and there is no real significant deficit. What is of real concern is that the most senior members of the executive could not explain that.

This year $5 million was carried forward, and while it was used to reduce this year’s rates and reflected Covid-related financial uncertainty, it contained a significant capital component.

This represents ratepayers’ money that was collected in previous years for projects and activities that were not delivered.  

The poor state of capital budgeting was demonstrated in monthly graphs which showed that a lot more money was obtained from ratepayers for capital works than was actually needed.

When I asked why the graphs were no longer provided the response was that the graphs were withdrawn “as they were incorrect and misleading”. Remember, these were graphs which were provided by the staff themselves and yet they say that they were incorrect and misleading.

When I then asked for the 

expected budgets for February to June so I could produce my own graphs I was told that the figures were not available. This was a $22 million budget and the staff could not tell me what they expected to spend each month.

Well might they be cagey. This year’s capital budget was $22 million, nearly three times last year’s actual expenditure, yet at the end of March, three quarters through the year, they had only spent $6 million.  Clearly this year’s rates would have been significantly lower if the administration had a better handle on what they are planning to do.

But it is not just budgeting 

that is an issue. The auditor general identified a number of areas of non-compliance such as inadequate segregation of duties and inappropriately designed processes. What is concerning is that one of these areas of non-compliance was identified the year before but still wasn’t fixed. In places I have worked, both private and public sector, such problems would have been fixed in days, not years, or somebody would have lost their job.

Then there’s the lease of the office building at 246 Vincent Street where the city (read ‘ratepayers’) are paying the tenant $533,000 in each of the first three years of the lease in what must be one of the worst financial transactions ever, and which demonstrated just how far out of their depth the council and administration were at the time..

Hopefully with three new councillors with significant experience in accounting, with experience of running a small business, and experience in running a large organisation, the council will take a closer look at Vincent’s finances and stop accepting the ‘we haven’t got enough money’ excuse for raising rates.

They have got the money, our money, all we need is for them to manage it better.

Article provided by Dudley Maier, Highgate

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