Shires: either revenue must go up or expectations, down

By KIERAN FINNANE

 

Revenues either have to go up or expectations of shire councils have to go down. If neither happens, shire councils cannot achieve financial sustainability. That’s the broad conclusion of the Deloitte review of the NT shire councils, released today by Local Government Minister Malarndirri McCarthy .

The situation regarding roads within the shires is one illustration of the immensity of the task facing the councils and the paucity of current revenues to help them achieve it.

As always, the interest of the Alice Springs News Online is particularly in the two shires surrounding Alice Springs and having their headquarters here, Central Desert Shire and MacDonnell Shire.

What would it take to bring the roads in and around the Growth Towns in those shires up to a standard expected elsewhere in regional Australia?

There are two Growth Towns in Central Desert Shire – Lajamanu and Yuendumu. Yuendumu is better off than Lajamanu, for which over 90% of the roads with a 50km radius are deemed in poor condition (about 15% for Yuemdumu).

The review estimates an expenditure of $205.12million – a sum many times the entire shire budget – would be required for upgrades and major repairs, with a further $4.57million required annually for the ongoing repairs and maintenance. The review stresses that this backlog estimate does not include all communities within the shire, only the Growth Towns.

It’s worth remembering too the roads allocation for the Central Australian region in this year’s NT Budget: $21m, $2m of which will be dedicated to sealing just another four kilometres of the Tanami Highway.

As CEO of Central Desert Shire Roydon Robertson said at the time, “You can’t have Growth Towns without decent roads to the get to them.”

MacDonnell Shire has two Growth Towns, Ntaria (Hermannsburg) and Papunya.  Upgrades and major repairs to their roads within a 50km radius would require expenditure of approximately $183.15million, with a further $3.95million annually for ongoing repairs and maintenance.

Limited information meant that the review could not undertake a more comprehensive estimate of the renewals backlog for the shires’ assets, but it noted that many of the assets inherited by both shires were “past their useful life” and in need of upgrade or replacement.

The review deems this issue as one of the “critical” ones for the shires. Others include:

• councils being unable to derive a level of own source revenue, making them overly reliant on grant funding (more than 80% of their funding, much of it tied, limiting councils’ discretion to direct it where it may be most needed);

• planned changes to leasing arrangements that may result in paying higher leasing costs that will in turn reduce funding available for core service delivery;

• the costs associated with policy initiatives introduced by other levels of government, transferred to the councils without an equal transfer of funding;

• inadequate budgeting and accounting policies, procedures, systems and reporting leading to a high risk of materially misstated financial reports that may result in councillors and management making inappropriate decisions on the allocation of scarce resources;

• onerous reporting requirements imposed by funding providers, causing inefficiencies, additional costs and administrative requirements that reduce funding available for core service delivery.

These issues were among those leading the review to its conclusion that the current finances and financial policies of the shires it reveiwed are “financially unsustainable based on current practices”.

“This does not mean these Councils are in imminent danger of defaulting on their debt service obligations or that their immediate financial viability is being questioned, however the long term financial sustainability of these Councils will only be achieved through substantial or disruptive adjustments to revenue and/or expenditure,” says the review.

 

Pictured: Google earth view of ‘Territory Growth Road’ Lajamanu: over 90% of its roads within a 50km radius are in poor condition.  The price tag to fix: over $200m.

 

Related article: Vast geographic scale dwarfs shire budgets

 

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10 Comments (starting with the most recent)

NB: If you want to reply to a previous comment, start your comment with this notation: @n where n is the number of the comment you want to reply to.
  1. Posted December 24, 2012 at 8:10 am

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  2. Paul Parker
    Posted June 16, 2012 at 2:50 pm

    Agree with Bob Durnan: little logic exists in Commonwealth’s puppet string controlled NTG charade being played out.
    These are NOT growth towns, NOT even communities.
    They are zoo cages under Commonwealth control with Commonwealth appointed agents, the Central Land Council, acting as zoo keeper.
    Little likely economic, legal or social basis exists to establish viable private businesses.
    The reason is simple, these Zoo managers do NOT want any private developments.
    Issuing leases provides accountable rights and responsibilities, so Commonwealth exempts themselves and their zoo keepers from issuing valid leases for houses and other developments.
    The entire process to obtain and maintain leases is then corrupted.
    Real victims are those forced to negotiate this charade, along with intended beneficiaries from these zoo management schemes the “Traditional Owners” as both residents and beneficiaries they remain denied their basic rights as fellow Australians to healthy communities.
    “Traditional Owners” are temporary residents in what Commonwealth purports to be their homes, denied basic civil rights, such as the right to have families live with them or visit them.
    The Central Land Council argues “Traditional Owners” have no right to live in a house, no right to have family live with them or visitors visit them.
    Commonwealth defends its abusive legislation, and its managers, the Central Land Council, by refusing legal aid, so courts do not allow proceedings to continue towards judicial conclusions.
    Clearly “Traditional Owners” are little more than shareholders in these Commonwealth created entities.
    The Commonwealth allows these corporate entities to ignore basic legislation, responsibility and accountability as apply to others.
    It does this because all this racist behavior remains a product of Commonwealth racism towards Australians.
    Such racist behavior is NOT tolerated within the wider community towards fellow Australians.
    Unchallenged the Commonwealth soon enough will knock on other doors.

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  3. Russell Guy
    Posted June 14, 2012 at 11:32 am

    Hal and Bob, posted @ June 14th.
    Hal, your comment re take-away sales free days in Alice as a precursor to ameliorating some of the related social dysfunction is noted. You, like Bob and myself, and a handful of others posting to this site, have been calling for this for some time.
    I would like to see a community push for Sunday to be declared a take-away sales free day in the first instance, for critical community assessment. It’s the day when we all need some time off – alcholics to police – and, depending on your perspective, allows some rest for a productive working week.
    If we, as a community, are ever going to get on top of this situation, work and its benefits have to be seen as a priority for all citizens. The current alcohol supply regulations confound that aim and are demonstrably counter-productive on many levels, as we all know.
    As you correctly point out, the pollies seem caught in the headlights of the alcohol industry, who contribute to their campaign funds.
    Vested interest by licencees is also a factor in continuing this disastrous community-sanctioned program of alcohol-related dysfunction. We need a genuine community desire for change and a push for a Sunday-free from takeaway alcohol sales is a place to start.
    Bob, I concede that systematic grading of certain remote roads is a necessity and is an excellent community-driven employment contract – the sort of thing that the Shires could perhaps try to bring about.
    The Plenty Highway, being a major tourist and community access road into Central Australia (on the NT side) requires regular grading, but it’s often in a poor condition, due to heavy caravan use, and of course, local traffic, including myself, who have no option, but to tolerate it.

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  4. Hal Duell
    Posted June 14, 2012 at 2:20 am

    @Bob Durnan (Posted June 13, 2012 at 5:29 pm)
    It is nothing short of amazing that the link between disruptive behaviour and alcohol is still a contentious topic.
    A report to our Town Council on the Port Augusta model is due soon. I look forward to reading what it says about that town’s alcohol policy. I am, however, leaning away from expecting a panacea. Alice is home to 250(?) remote communities and once here, urban drifters have nowhere else to go. Port Augusta is home to a couple of remote communities, and once there, the next town is just down the road.
    Looking at the NT as a whole I sometimes think alcohol and the alcohol lobby are the headlights and our pollies are the rabbits caught in the glare. All are scared to jump to either side, and they all just keep getting run over.
    Closing the bottle shops on one day a week to give us a time out would cost nothing and be so easy to do. But the mere mention of it brings a reaction akin to threatening a birthright. They are so stubborn, and so timid.

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  5. Bob Durnan
    Posted June 14, 2012 at 1:17 am

    Further in reply to Hal Duell (Posted June 13, 2012 at 2:05 pm): Hal,
    I agree that “it’s unrealistic to imagine every small outstation can have all the amenities needed for modern life, amenities like roads, schools, stores and medical clinics.”
    Despite this, I believe those few outstations which are consistently occupied do need to have their access roads graded, plus sometimes some other road repairs, to enable their occupants to maintain access to their closest “schools, stores and medical clinics” without constantly damaging their vehicles in the process. To do otherwise will only worsen the already considerable problems of over-crowding and social dysfunction in the main settlements, and risk completely wasting the substantial and often worthwhile investments in housing and essential services that have been made on the outstations in the last forty years.
    This necessity should stand beside the undeniable need for much more robustly constructed and better maintained connector roads between most of the communities, or settlements. In the west-north-west sector of greater central Australia out from Alice, these settlements include places such as Nyirrpi, Willowra, Yuelamu (formerly Mt Allan), Walungurru (formerly Kintore), Kiwirrkurra, Balgo, Watiyawanu (formerly Mt Liebig) and Ikuntji (formerly Haasts Bluff), for example, as well as the few places anointed as “growth towns” in this sector, such as Hermannsburg, Papunya, Yuendumu and Lajamanu.
    These places are much larger than outstations (or homelands as they are sometimes known, especially in the Top End). Outstations consist mainly of single extended family groups living in a handful of houses and /or tin shacks, some of which may not be occupied. Outstations do not normally have schools, stores or clinics, except for some of the larger outstations, or groups of outstations, at Urapuntja (aka Utopia) in the Sandover region to the north-east of Alice, which do have primary school buildings. (The many Hermannsburg outstations had three outstation schools operating in the ’80s and ’90s, but these are no longer functioning, owing to too few students in their vicinity. Attempts at providing schooling and clinics out of the backs of Toyota Troop-carriers, and delivered by travelling staff and local assistants under trees or in tin sheds, were made in the mid-to-late 1970s, but ceased decades ago on most other outstations in central Australia).
    On the other hand, the settlements, or communities, like the twelve cited above, mostly contain multiple clans and many family groups, many houses of varying quality, usually have much overcrowding, and most seldom have vacant houses for any serious length of time unless a death of an important person who has lived in the house has occurred. These places usually have what is by contemporary Australian standards mostly rudimentary infrastructure that includes a school, a clinic, some very poor sport/recreation facilities, some staff housing of varied quality, small basic council/shire offices, access to an airstrip of some description, and some poorly bitumenised streets.
    These places, unlike outstations, do need to have some of “the amenities needed for modern life”, but these amenities – roads, schools (including pre-schools), stores, police stations, youth/recreation centres, medical clinics and family/early childhood centres – need to be of sufficient standard, quality and size to meet the needs of the local population and the people who often have to move to the community for a few years to ensure the services are able to meet the needs of Australian citizens in the 21st century.
    If the Australian tax payers aren’t willing to foot the bills for this infrastructure and the workforce that must go with it, then they are going to be saddled with a mostly perpetually dependent and increasingly troublesome remote population which will gravitate towards places like Alice Springs anyway, but which will have neither the education nor health to permit them to go forth into the wider world for secondary and further education, training, jobs and life’s adventures without falling foul of too many problems and traps, and thus becoming an even greater burden on the state and its beleaguered tax payers.

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  6. Bob Durnan
    Posted June 13, 2012 at 5:29 pm

    Re Hal Duell (Posted June 13, 2012 at 2:05 pm): the problem of feuding families, clans and language groups does follow many people into town. You only have to look at the regular playing out of major scenes from on-going Yuendumu, Willowra, Laramba, Watiyawanu and Ntaria feuds occurring in Alice Springs during the last couple of years to see this. However some of the intensity of of these skirmishes could be lessened were the alcohol tap to be turned down to a more manageable level.

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  7. Hal Duell
    Posted June 13, 2012 at 2:05 pm

    One unaddressed problem with the Growth Towns might prove to be the same one that afflicted the new communities of Papunya in the Centre and Wadeye in the Top End (among others) forty years ago. And that’s the problem of forcing different mobs to live in the same community when they might not want to.
    Or has that issue been resolved?
    I think it’s unrealistic to imagine every small outstation can have all the amenities needed for modern life, amenities like roads, schools, stores and medical clinics. Where will all that money come from, especially as it doesn’t look like an economy, other than a recipient economy, will be getting built any time soon.
    I still think the central control maintained by the large land councils has a lot to do with that economic stagnation.
    So we live in times of increased urban drift, and who can blame those coming in for moving.
    The trouble is that the urban centres are only just managing to provide for those already here. Housing especially is in short supply, but hopefully the Kilgariff suburb will go some way to alleviating that in Alice Springs.
    The other change that would do wonders to the social interaction in the urban centres is a massive attitude scrub on the part of the new arrivals. To come to town carrying the same expectations of entitlement that are prevalent on communities is counter productive.

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  8. Russell Guy
    Posted June 13, 2012 at 10:13 am

    It’s no secret that the Shire Councils “have no money” but the question begs, what are they doing with what resources they have? It also seems to me that they could be working with other government departments in creating employment in the remote communities within their boundaries. This is the obvious way to raise rate-based revenue and grow these communities.
    There is a lot of talk about Vocational Training Employment Centres (VTECS) and the Remote Jobs Communities Programs (RJCP) from both sides of politics. The talk about training for jobs that actually exist is fair enough, but not that many exist outside mining and that has many teething problems that need to be addressed.
    One solution for the Shires in their present state is to engage with those who are talking these programs up and focus on the real problem of job creation and welfare reform. There are Federal government programs for the upgrade of remote airstrips. Perhaps the Shires could look at this as micro-employment projects, leading to other things like tourism.
    As far as emergency evacuations go, the history of the RFDS proved that this could be overcome almost a hundred years ago. Roads are roads out bush and sensible driving attitudes with appropriate vehicles are still the best way of living and getting around.
    A lot more creative thinking about private sector employment and effective integration with allocated government funding is required from the Central Desert Shire.

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  9. Bob Durnan
    Posted June 13, 2012 at 1:34 am

    The sooner the notion of “growth towns” in central Australia is discarded the better. It is only serving to confuse the issue and divert attention from rational planning for the future of remote communities and their relationships to each other and to Alice Springs.
    There is little logic in the charade being played out about these local growth towns, as there is very little apparent or likely economic, legal or social basis for the establishment of viable private businesses beyond a handful of single person or single family or other very small enterprises in them.
    Likewise there is no foreseeable ability by either the NT government or the Shires to invest sufficient resources in these places to change their current economic and social trajectories.
    The figures that Kieran quotes about roads clearly indicate the problems. To prioritise spending on local roads (presumably mainly to outstations) within 50 km of Yuendumu above the completion of sealing the Tanami as far as Yuendumu, or over the need to upgrade and properly maintain the entire lengths of the arterial roads from Yuendumu to Willowra and Nyirrpi, or the Willowra-Ti Tree connector, would appear to be sheer folly. Similarly, to privilege other development in places like Yuendumu (which was losing population well before it was declared a growth town, and appears to have gone on doing so at a greater rate since then) and Lajamanu over the rest of the Stuart electorate communities on the basis of fanciful preferential status rather than allocating funds according to need is indefensible.
    There are strong demonstrable needs for infrastructure investment in many other remote communities which haven’t been dubbed growth towns, and it is unbelievable that senior politicians and public servants are continuing to bury their heads in the sand about this.
    The fact that the major towns in the NT continue to have their astonishing sporting and other civic facilities upgraded year after year while significant bush communities go for decades begging to get culverts installed and sufficient grading and repairs on their main access roads so they can safely send an ambulance to town or otherwise try to conduct their necessary business in a safe manner speaks for itself.
    The standard of sports facilities, where they exist at all, in most remote communities is worse than shameful. Airstrips are often inadequate for night time and wet weather evacuations.
    It is rare to find an adequate youth centre or recreation hall or civic centre building in these places, despite exceptionally high needs.
    People in Alice Springs wonder why people from the bush want to escape from life in these badly under-resourced and neglected places …

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  10. FMark
    Posted June 12, 2012 at 4:46 pm

    Very revealing, thanks Kieran. I wonder how many of these roads go to the communities the “growth towns” are supposed to service? And thanks also for linking to the Deloitte report – its little things like this that make the online version of the news a big improvement over the deadtree edition.

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