2015-06-29 Special Meeting Agenda

COUNCIL POLICY – FINANCIAL SUSTAINABILITY


Debt management

Total Council debt will reduce over the life of the ten (10) year financial plan.

New debt will only be incurred for specific new capital projects where other funding sources have
been exhausted, and debt will be utilised for intergenerational equity purposes.

The net financial liabilities ratio is one of the three (3) key measures of financial sustainability required
under legislation. The net financial liabilities ratio represents Council’s net financial liabilities (total
liabilities less current assets) expressed as a percentage of total operating revenue. A negative
percentage indicates that current assets exceed total liabilities. The target net financial liabilities ratio
set by the state government is less than 60%.

Council will adopt a conservative approach to new debt to ensure that the net financial liabilities ratio
is below the target over the life of the ten (10) year financial plan. This will be achieved by setting an
upper limit of 5% of gross general rate income for interest payments on borrowings.

New debt that may be required to assist with the funding of trunk infrastructure to cater for future
growth will be considered on a case by case basis.

Full cost pricing

Council will ensure that competitive neutrality and full cost pricing outcomes required under
legislation with respect to its business activities are complied with on an annual basis.

Commercial opportunities

Commercial opportunities will only be considered if they provide value for money to the community
and have a positive net impact on overall general rate funding requirements of Council.

The QTC project decision making framework will be utilised for business case analysis for all new
identified commercial opportunities. The outcomes from the analysis will be used to inform Council
of whole of life costing implications associated with each commercial proposal.

ROLES AND RESPONSIBILITIES

The Mayor is responsible for the preparation and presentation of the annual budget to Council in
accordance with section 12 (4) (b) of the Local Government Act 2009.

The Chief Executive Officer is responsible for the delivery of the annual budget.


RELEVANT LEGISLATION

Local Government Act 2009
Local Government Regulation 2012




Version control:
  Version          Reason/ Trigger             Change (Y/N)   Endorsed/ Reviewed by       Date

  1.0              Create new                                 Michael Shave               02/06/2015




                                                                                                 Page 3 of 3