The Beagle Editor, It is of interest that we read that the Eurobodalla Shire also has hesitations in gaining grants to build new infrastructure as the grants do not come with any contribution for the burden placed on the community to then maintain and eventually replace that asset. Your readers might be interested in our latest media release like a drunken sailor …
The Bega Valley Shire Residents & Ratepayers Association (BVSRRA) reckons that there wouldn’t be a week that goes by without a NSW government Minister announcing a major project involving the expenditure of millions of dollars on capital works of some description.
While some of that expenditure involves major freeway construction, including upgrades, new public transport infrastructure, as well as new hospitals & schools, there are a myriad of other public infrastructure projects underwritten by the state government, the maintenance of which winds-up being the responsibility of local councils, including Bega Valley Shire Council (BVSC).
Looking closer to home, in January of this year, the Member for Bega, the Hon Andrew Constance, claimed that the NSW government was spending a staggering amount of money in regional NSW, including around $800m in his Bega electorate alone.
After the BVSRRA requested details of the $800m in expenditure claimed by Mr Constance, his office provided the BVSRRA with a list of more than 150 grants made to fund projects across the Bega electorate in 2016/2017 alone (Mr Constance’ office has promised to provide the full $800m list in the near future).
The grants detailed involved a wide variety projects, with some costing tens of millions of dollars, such as $40m for the Eden Wharf Extension, $16m for the new Bemboka Bridge, $4.5m for the Moruya Airport upgrade, $5.5m for the expansion of Merimbula Airport, $10m for the Batemans Bay Spine Road, while others are for as little as $2,000 for renovations to the Twofold Bay Yacht Club & $500 for Tathra AFL coaching accreditation courses.
And while every community & community group benefiting from grants might sing Mr Constance’s praises, the reality is that most of the public infrastructure projects will add a largely hidden financial burden on ratepayers into the future, in the form of significant maintenance costs, which could amount to between 2%-5% of the replacement cost of the assets annually over their life; equivalent to between $25k-$70k per annum for every $1m in newly created assets.
And while the BVSRRA doesn’t have access to the financial details of specific projects, it believes that if 80% of the grants funding ($640m) was for public infrastructure, which councils will be responsible for maintaining, & the average lifespan of the assets is 20 years, then those projects can be expected to add an average of $18m-$44m in maintenance costs each year to local government budgets over that period.
The BVSRRA believes that it is difficult to recognise this hidden financial threat as, when bureaucrats submit proposals to council for consideration & approval, more often than not such cost considerations don’t rate a mention.
While the real net financial impact of what appear to be positive funding announcements are not publicly explored, ratepayers should understand that they will be expected to meet such costs through increases in rates & charges.
And while the issue of growing maintenance costs is important, so too is the prioritisation of government assistance. While just about every community & community group will have a need for assistance, the demand for additional public infrastructure seems never-ending, meaning that it is essential that spending priorities must be established to ensure vital basic infrastructure requirements are met ahead of other, less important priorities.
The full text of this Media Release is available here … http://www.begavalleyshireratepayers.asn.au/files/Bega-Valley-Shire-Residents---Ratepayers-Association---Media-Release---like-a-drunken-sailor---10.04.2018.pdf
Bega Valley Shire Residents & Ratepayers Association