2015-06-29 Special Meeting Agenda

2015/2016 DEBT POLICY


GUIDING PRINCIPLES
The purpose of establishing a Debt Policy is to:
 Provide a comprehensive view of Council’s long term debt position and the capacity to fund
   infrastructure growth;
 Increase awareness of issues concerning debt management;
 Enhance the understanding between Councillors, community groups and Council staff by
   documenting policies and guidelines; and
 Demonstrate to government and lending institutions that Council has a disciplined approach to
   borrowing.

ROLES AND RESPONSIBILITIES
Pursuant to section 192 of the Local Government Regulation 2012, detail of the proposed
borrowing for the current year and the future 9 years will be prepared annually as part of the
budget process.

Applications outlining proposed borrowings will be forwarded to the Minister for Local Government
for approval.

Credit Reviews will be undertaken periodically by QTC on behalf of the Minister for Local
Government.

Loan proceeds will be drawn down subject to cash flow requirements annually so as to minimise
interest expenses.

All lease proposals will be referred to the Financial Services Section for evaluation against the
QTC Asset Financing Model to assess alternatives for funding asset acquisition and to ensure
statutory compliance.


MEASUREMENT OF SUCCESS
Financial sustainability indicators remain within target ranges and the provision of necessary
infrastructure is not constrained through a lack of capital funding.

Details of outstanding loans will be reported annually in Council’s Budget and Financial
Statements.


DEFINITIONS
Business Activity – An activity within Council subject to the application of full cost pricing
principles as defined by the Local Government Act and regulation.
Inter-generational equity – This relates to the fairness of the distribution of the costs and benefits
of a policy when costs and benefits are borne by different generations. (i.e. the principle whereby
those who derive a direct benefit from the service or infrastructure provided actually pay for that
service).
Net financial liabilities ratio – This is an indicator of the extent to which the net financial liabilities
of Council can be serviced by its operating revenues.
QTC – Queensland Treasury Corporation.




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