Benalla Rural City Councillors clashed over whether to put the proposed budget for 2024/25 out for feedback at Wednesday’s council meeting.
The meeting, held on May 1, started with discussion on the document, which will show a surplus. However it also predicts a deficit for the following three budgets.
Council staff, councillors and the chief executive spoke to explain why that was, and what it would mean for the community.
Rate capping was one reason cited.
The continued recovery from the COVID-19 pandemic and several weather events, the aftermath of which were costly to council, were also spoken about.
Since 2022, Benalla has experienced serious flooding twice and several storm cells that affected roads and infrastructure, including many instances of damage to overhead power lines and trees.
While there has been some federal and state support to repair damage caused by these events, council has had to bear the burden of repairs, all of which has affected its bottom line.
In the past 12 months, council has also seen a $10 million reduction in its capital grants for the recovery of flood works.
The predicted budgets only include grants that have been confirmed, and council staff cited several that were on the table but were unable to be included.
For example, there is $15 million that council expects to receive for the Benalla Indoor Recreation Centre.
Several councillors spoke in favour of the proposed budget, with Cr Peter Davis commending that it was in line with the Council Plan.
“I’d like to see a lot more constructive submissions come in from our rate payers,” Cr Davis said.
Cr Davis said he took it to heart that when the budget wasn’t even out for public feedback that a local Facebook page allowed anonymous posts from people venting their anger at council.
“The fact (is) that those people should be putting in constructive submissions so that we, as councillors elected by ratepayers, can do something about it,” he said.
When it came time to vote on the proposal to put the budget out for community consultation, Cr Puna Gunaratne spoke to say he wasn’t comfortable supporting it.
He said he would like to see future deficits reduced before the consultation process began.
“Looking at the budget, unfortunately I can’t endorse this for public exhibition,” he said.
This shocked other councillors, and Mayor Danny Claridge moved a motion to suspend standing orders, which was passed.
“I’d like Cr Gunaratne to explain, seeing we’ve sat through quite a few workshops, why now you’ve decided you’re not happy with the budget,” Cr Claridge said.
“There are a lot of things,” Cr Gunaratne said.
“This budget was presented to us last week...
“When I looked at the full picture I was really stunned to see an underlying deficit going forward.”
Cr Gunaratne said he was not in a position to endorse a budget with an underlying deficit.
In response, Cr Claridge asked him to explain how he would fix that problem.
“I think we need to look more broadly into this budget, and go deeply into this budget,” Cr Gunaratne said.
“To understand what we do, and understand the underlying deficit more, in detail.”
Cr Claridge responded, saying he felt Cr Gunaratne did not have an explanation of what he would do, to rectify the deficit.
Cr Gunaratne disagreed.
“I do have an explanation, if you break down the limits of what are the business units making this underlying deficit,” he said.
“And if you come up with these numbers, these numbers are not there in this budget.”
Cr Davis asked Cr Gunaratne if he would recommend cost-cutting in the budget.
“This budget today is an underlying deficit result, and in the future is a deficit result,” Cr Gunaratne said.
Cr Davis continued to push Cr Gunaratne, asking if he would reduce council services to achieve a reduced deficit, or surplus.
Cr Gunaratne said that was not the case.
“But if you reduce the underlying deficit, you’re reducing costs, which is reducing the budget,” Cr Davis said.
Cr Gunaratne disagreed.
“No, you will make decisions to run a cinema,” he said.
“And there’s no number here to say how much of a deficit (council is) making from that.”
Cr Davis argued that every councillor had had the individual figures for specific council activities available to them.
“There’s two ways to do that (achieve a surplus). One is staff (reducing council staffing numbers), and the other is maybe we do away with our landfill,” Cr Davis said.
“We’ve picked that up by $7 million in the last five years. Taking it from a $7 million loss to something that looks like coming in at net-net, or even a little bit better.
“So to get rid of an underlying deficit. I’d like to know how you’re going to do it?
“To stand here tonight and say you’re going to vote against putting this out to the public. I want to know why you don’t want to put it out to the public?”
Cr Gunaratne said he had already explained his position. Cr Davis disagreed.
Cr Gunaratne went on to state his issue was not simply with one year of deficit, but an ongoing deficit in the coming years.
He argued that it was his job as a councillor to look into these matters, and said that was what he was doing.
Cr Davis said he felt Cr Gunaratne already had enough time to do that.
“As (has) every councillor ... in the room,” Cr Davis said.
The two clashed on whether all of this should have been addressed in several budget workshops that all councillors attended, with neither willing to give any ground.
Ultimately, a recommendation to put the draft budget out for community consultation was passed by six votes to one.
The meeting is available to watch via Benalla Rural City’s YouTube channel.
Community members can read the proposed budget and have their say via haveyoursay.benalla.vic.gov.au/proposed-20242025-budget/