Delivered by Cr Bob Manning, Mayor of Cairns, on 3 July 2019
I am pleased today to present Cairns Regional Council’s Budget for 2019-2020 – the last Budget for this term of Council and one that reflects a consistent record of strong financial management and a high standard of service delivery that we can all take pride in.
The fiscal discipline of this organisation; the pursuit of continuous improvement; and the determination to find more efficient ways to do our job in continually improving services have been critical in achieving the sound financial position we are in today.
Put simply, it’s about maximising the community benefit from every dollar we manage.
This vigilance will result in a modest operating surplus for the 2018-2019 year.
Upfront, I want to publicly recognise management and the staff of Council for their diligence and commitment to achieve this outcome.
This outstanding result and the $316 million balanced Budget to be handed down today is consistent with what this Council is all about and it is fitting at this time to reflect upon some of the achievements of this term and the previous term of Council during which I have had the privilege to be Mayor:
- This will be the sixth year that Council has handed down rate rises at or below CPI. This is perhaps the best indicator of good financial management and one that is critical for our economy because it means people have more money in their pockets to spend in our community.
- In delivering these low rate rises, we have still managed to maintain a significant Capital Works program. We have delivered a total of $870 million in Capital Works over the past 6 years – when you take into account this coming year, that number will exceed $1 billion.
- We have done all of this and kept debt at an appropriate level – currently Cairns has the fourth lowest debt per capita among 15 similar sized Councils in the State
- We have also handed down balanced budgets since 2013; and
- We have delivered surpluses in operating expenditure over the past 6 budget cycles.
I suggest that any Council would be proud to have that record of financial management and performance.
If the organisation continues to be prudent in its planning and expenditure, financial modelling forecasts for the next decade indicate a capital expenditure of approximately $1.6 billion, annual rate increases in the order of 2%, and a sustainable level of borrowings commensurate with a growing city.
As a stable and fiscally strong Council, this puts us in good stead to manage some of the challenges our city is facing.
Our job is to work with other levels of government and the local business community to create the best environment to attract investment in the region that builds business and consumer confidence, and an improving lifestyle and opportunities for our residents – especially the young.
This year Council will stimulate the local economy through the expenditure of more than $380 million on materials and services associated with delivering our Capital Works program; and for maintenance, renewals and other services delivered to the community.
And it is important to note that approximately 90 per cent of Council’s total expenditure is invested locally through employment and locally sourced materials and services.
We are all acutely aware of the challenges currently confronting regional tourism in Queensland and which has been exacerbated by “concerns” about “climate change” and its effects on the Reef. These concerns are partly evidence based but have also been added to by unsubstantiated media and other claims about the overall status of the situation, and a growing need for State and Federal Governments to reconnect to regional Australia tourism meaningfully and financially.
In recognition that tourism is the driving force behind Cairns’ economy, Council has again allocated $3.4 million to fund tourism promotion.
I firmly believe that the time has come for Council (in association with the “tourism industry”) to address the issue of sustainable funding into the future. I also firmly believe that a successful future for Queensland tourism rests with the development and promotion of regional Queensland product and its rich diversity including The Cape, the Great Barrier Reef, the Wet Tropics, the Gulf, Mackay, the Whitsundays, and the Outback. A compelling case in support of the above exists based principally on:
- Level of funding, and
- Greater autonomy and independence in policy formulation – and this is generally supported by the industry.
To not do this could well hold back the development of Cairns and Tropical North Queensland in regard to:
- Population – retention./growth, and
In recognition that events generate economic benefits to the region, Council has allocated $850,000 in this Budget to support large events such as the Cairns Adventure Festival and Ironman, Targa Great Barrier Reef and Chinese New Year.
In addition, $220,000 has been allocated for other economic and industry development and diversification, including $100,000 aimed at boosting the international education sector.
Increasing visitation (both visitors and locals) to our CBD is also a top priority and, as such, we have responded to traders’ concerns, with Council recently announcing a number of initiatives aimed at boosting activation, including re-introducing free parking on Saturday afternoons and all day Sunday.
What we really need at the end of the day is a half a million more legs traversing the CBD – in other words, we need to boost our tourist numbers through effective/sustainable promotion of this region as a premier destination, and in addition, attract locals back into their city centre.
This requires a collaborative effort from businesses, landlords and the Chamber of Commerce, and indeed, from everyone who lives in this region to make the effort to work together to support the CBD and local businesses.
Council has set aside funds in this Budget for an activation program for the CBD and for the appointment of a CBD Place Manager to proactively work with traders and other stakeholders.
This Budget also partially funds two major projects within the CBD which will undoubtedly add to its attraction for locals and tourists:
- the $3.6 million completion of the Court House refurbishment as part of the broader Gallery Precinct, and
- the commencement of a major upgrade to the Esplanade Dining Precinct and Stage 3 of the Shields Street project, with $3 million allocated this year, and $13.5 million next year.
Florence Street will also be redeveloped to provide improved pedestrian connectivity from the CBD to the Cairns Performing Arts Centre and Munro Martin Parklands, with nearly $10 million allocated this year and $5 million in the next budget to complete the project.
Council will need to manage and progress these works in close consultation with various businesses and other stakeholders so as to minimise any disruption to business operations/continuity.
This Council has committed to do everything in its power to stimulate the local economy and, as I stated earlier, keeping rate rises to a minimum very much contributes to that goal.
In striking the rate in the dollar for 2019/20, Council took into account that land valuations released by the State Government’s Department of Natural Resources, Mines and Energy have risen by an average of 7% (some by up to 29%), with the median residential land value increasing from $177,500 to $190,000.
We have responded by reducing the rate in the dollar by up to 5 per cent in almost all residential categories.
This will assist to smooth out the impact of the higher values and results in 70% of ratepayers receiving an increase of 1.5 per cent or less in their general rates.
Sewerage, cleansing and water access charges will also increase by just 1.5 per cent, while residential water usage charges will rise by just two cents to $1.21 per kilolitre.
Council has already announced that there will be no increase to Council’s fees and charges for the next financial year apart from two charges connected with commercial waste management, and parking costs which will rise by 20 cents per hour from 1st January next year.
In due course, we will again do our annual benchmarking exercise which compares our rates and utility charges with 11 other Councils of similar size. This exercise has traditionally returned excellent results for Cairns – in fact we have been lowest of all of those councils for the past 2 years based on residential median value.
CAPITAL WORKS PROGRAM
One of the key components of the Budget is Council’s Capital Works program which we recognise is a significant contributor to the city’s economy. It has been a guiding principle of this Council to keep our capital works at the maximum possible level whilst having regard to Council’s long term financial goals.
A similar pattern has been achieved again this year, with $164.7 million of Capital Works to be delivered across the length and breadth of our local government area, with an emphasis on renewing core infrastructure vital for the smooth delivery of services to the community.
The program for 2019-2020 includes:
- $50.6 million on roads, drainage, and footpaths
- $24.2 million on improving our wastewater network
- $28.2 million on water and waste infrastructure, and
- $29 million on community, sport and cultural projects
Aside from the projects I mentioned earlier, some of the highlights of the capital works program are:
- $8 million for road treatments throughout the city
- $7.4 million to progress the much anticipated Northern Beaches Leisure Trail
- $5.8 million on sporting facilities including $3.4 million to build roofs over the Cairns International Tennis Centre and the Martyn Street Netball centre; and $900,000 to upgrade amenities at Alley Park
- $5.9 million on new kerb and channel and shoulder sealing
- $4.1 million on improving the drainage network
- $3 million to repair Lake Morris Road
- $3.2 million to construct or renew footpaths
- $2.6 million to create more parking spaces in North Cairns and other parking projects
- $2.5 million for the Redlynch Village project
- $2.4 million to construct a new section of McGregor Road, Smithfield
- $1.47 million to create more parking spaces in Cairns North
- $1.45 million for upgrades to our aquatic facilities
- $1.4 million to widen busy Mill Road at Edmonton
- $1.8 million to improve playgrounds, parks and toilet facilities, and
- $982,000 to improve back-of-house facilities at Munro Martin Parklands.
As the custodian of a sensitive and valued environment, Council is acutely aware of its responsibility in this regard.
Quite rightly, Council should be demonstrating leadership in this area, and I am pleased to note that we have managed to cut greenhouse gas emissions as of 2007 by 47% thus far in keeping with the commitment of a reduction of 50% by 2020.
This target is now well within our sights and this year’s Budget features $15.6 million in environmental initiatives that will certainly make this target more than achievable.
As part of the Capital Works program, Council will spend $3.35 million to create mini solar farms at five of our wastewater treatments which will generate 1.7megawatts of energy, reducing our electricity costs at those facilities by 26%, or $417,000, each year.
We will also fund the installation of solar panels at Gordonvale, Smithfield and Woree swimming pools.
A major upgrade of the Materials Recovery Facility costing nearly $6 million will also yield big dividends in the recycling space. The upgrade will increase the capacity of the facility to deal with a greater volume of recyclables, resulting in significant increase in diversion from landfill from the current 50% to up to 90%. An additional $1 million has been committed in next year’s Budget to complete this project.
The popular Buy Back Shop will also be upgraded to improve the delivery area so that this facility is able to process many more items for re-use.
In addition to these projects, Council will also continue on its rollout of smart water meters, with $3.4 million allocated in this year’s Budget and $13 million slated over the next two years to complete the installations across the city. From all accounts, the trial of these meters at Palm Cove is yielding good results, with water leaks that would otherwise have not been detected being identified by the system.
Sometimes it’s projects that don’t cost a lot that can really make a difference. For example, Council has allocated $600,000 to increase its capacity to recycle concrete. The upgrade will allow more than 10,000 tonnes of concrete from Council demolitions to be crushed and reused locally in the construction of roads and as a sub-base for buildings, resulting in cost savings and, again, reducing the amount of waste going to landfill.
Another major component of the budget is the operating expenditure – this principally involves the maintenance and upkeep of our road and drainage network, our 577 parks and nature areas; 485km of footpaths; 799 litter bins, and 64 toilet blocks. To maintain these assets at a high standard costs approximately $40 million a year.
Grants for community, sporting and cultural activities and events is also funded from the operating expenditure budget, with $1 million set aside to support these actions, as well as $1.4 million to fund lifesaving services at the Lagoon and on the Beaches, and $1.7 million to support the operations of the Cairns Art Gallery and the Cairns Museum.
As demonstrated by today’s Budget, and indeed the previous six budget cycles, strong financial management is a hallmark of this Council and is pivotal in being able to continue to provide the best facilities and services with low rate rises.
However, there are challenges facing our city. It is important that we remain focussed on what needs to be done to lift economic growth and be resolute in how we go about pursuing these goals.
There is no doubt that the successful management and promotion of the Great Barrier Reef is paramount. The preservation, effective management and promotion of the Reef must be recognised as a strategic priority of national and global importance, and as such, we will continue to advocate for a review of the management structure and funding.
This would send a powerful message that this nation has the boldness, vision and leadership to do what it is necessary to protect this global icon.
Another strong focus for the next 12 months will be the pursuit of a City Deal for Cairns which has the potential to accelerate the delivery of a number of key projects that have been identified as being instrumental in improving our economy and the quality of life for those living in our region.
It is incumbent upon this Council to back our city and region like never before and to be relentless in our pursuit of opportunities that come our way. This Budget and the strategy which underpins it is predicated upon Council doing just this.
Council’s advocacy plan for 2019/20 is already clearly laid out and has been used for the recent Federal election as well as the 2019/20 Federal and State budgets. The “thinking” within these submissions is well thought through – including the 2050 Shared Vision. At every opportunity, Council (and adjoining Councils and colleagues) take up the fight to State and Federal Governments to “get our fair share”.
Given the recent announcement of the forthcoming COAG meeting to be held in Cairns, this will offer a great opportunity to engage with State and Federal leaders and politicians.
There may be some in the community who, with some justification, could say that Council should be “trying harder”. Whilst I would listen respectfully to that case, I don’t believe it to be the case.
In closing, the Budget provides for the delivery of services expected by the community, and positions this Council well into the future.
I would like to thank and commend my fellow Councillors for their time and input in preparing the Budget and acknowledge the efforts of Council management and staff throughout the budget process and in preparing the reports to be considered today.
I commend the 2019-2020 Cairns Regional Council Budget to you for its adoption.
Before dealing with the respective resolutions, I would like to offer Councillors – commencing with Division 1 and progressing through to Division 9 – an opportunity to speak to the Budget. I would appreciate it if Councillors could limit their comments to 3 minutes each.