2026/2027 Integrated Planning & Reporting

SUBMISSION – 2026/27 INTEGRATED PLANNING & REPORTING DOCUMENTS
Oberon Council

To: The General Manager
Oberon Council

RE: Submission – Draft 2026/27 Integrated Planning & Reporting Suite

I write to make a submission regarding the draft 2026/27 Integrated Planning & Reporting (IP&R) suite currently on public exhibition, including:

Draft Operational Plan
Long-Term Financial Plan
Statement of Revenue Policy
Workforce Management Plan
Open Spaces and Recreation Asset Management Plan
Fees and Charges

Whilst the documents attempt to present a “back to basics” and financially sustainable position, a detailed review indicates that Council remains under substantial long-term financial pressure, with increasing reliance on debt, reserves, rising charges and uncertain future grant funding.

I do not believe the public exhibition material adequately or transparently explains the true long-term financial position facing the organisation.

OPERATING POSITION AND FINANCIAL SUSTAINABILITY

The Operational Plan highlights a forecast “net operating surplus after capital expenditure” of only approximately $11,000.

For a Council managing over $421 million in infrastructure assets, this effectively represents no meaningful financial buffer whatsoever.

The figures presented demonstrate that Council is balancing extremely close to the line and remains heavily dependent upon:

grant funding,
reserve drawdowns,
internal financial transfers,
borrowing,
and increasing community charges.

The Long-Term Financial Plan further demonstrates ongoing structural financial pressure across the duration of the plan.

While some headline figures may initially appear positive, the underlying detail reveals:

recurring operational deficits before capital expenditure in most outer years,
continued reliance on increasing fees and charges,
significant reserve depletion,
increasing employee costs,
increasing depreciation liabilities,
and growing infrastructure renewal pressures.

The documents do not sufficiently communicate the seriousness of these long-term pressures to the community.

SEWAGE TREATMENT PLANT – TRUE BORROWING EXPOSURE

One of the most significant concerns relates to the Sewage Treatment Plant project and the total debt exposure associated with it.

The public exhibition documents refer to:

reserves,
grant funding,
internal funding movements,
and a proposed additional $5 million loan.

However, the documents fail to clearly explain the cumulative total borrowing exposure associated with the STP project.

Based on previous Council reporting together with the current exhibited material, the STP project now appears to involve:

an earlier loan facility of approximately $3 million,
plus a further proposed $5 million loan,
creating a total borrowing exposure in the vicinity of approximately $8 million.

This is a significant level of debt exposure for a rural Council the size of Oberon.

The exhibition documents do not clearly present:

total cumulative debt,
long-term repayment obligations,
total projected interest costs,
the full impact on future sewer pricing,
or the long-term impact on financial sustainability.

At the same time, the Long-Term Financial Plan forecasts ongoing 5% annual sewer charge increases across the duration of the plan.

The community deserves a far clearer and more transparent explanation of:

total project cost,
total borrowings,
repayment timeframes,
interest exposure,
reserve impacts,
and future pricing consequences.

RESERVE DEPLETION AND CASHFLOW PRESSURES

The documents also confirm significant reserve drawdowns and cashflow pressures.

The Operational Plan identifies:

over $8.2 million in transfers from reserves in 2026/27,
while the Long-Term Financial Plan confirms Sewer Fund reserves are being heavily utilised to support the STP project, resulting in an anticipated 50% reduction in investment balances and reduced future interest income.

This indicates Council is progressively consuming reserve capacity in order to maintain capital delivery and service obligations.

The broader concern is that once reserves are depleted:

future borrowing requirements may increase,
service reductions may occur,
or the community may face further fee and rate increases.

GRANT DEPENDENCY AND FUTURE UNCERTAINTY

The Long-Term Financial Plan openly acknowledges uncertainty surrounding major grant funding streams, including:

RERRF,
LRCI,
and Natural Disaster Funding.

Council states that these grants have not been forecast beyond known funding periods due to uncertainty regarding continuation.

This is highly significant because many of Council’s infrastructure delivery assumptions appear dependent upon external grant funding continuing into the future.

The Long-Term Financial Plan therefore appears vulnerable to:

future grant reductions,
economic downturn,
inflationary pressures,
and further cost escalation.

ROADS FUNDING DROP-OFF

The documents also indicate a major reduction in roads capital expenditure after 2026/27.

Roads capital expenditure drops sharply following the current year program, while the documents simultaneously acknowledge uncertainty regarding continuation of major road grant programs.

This creates concern regarding:

long-term road maintenance sustainability,
future infrastructure backlog growth,
and whether current service levels can realistically be maintained.

INCREASING COST SHIFTING TO THE COMMUNITY

The IP&R suite proposes:

rate increases,
3.5% fee increases,
5% water increases,
5% sewer increases,
5% waste increases,
and significant Independent Living Unit rental increases.

At the same time, the documents repeatedly refer to:

affordability pressures,
workforce pressures,
infrastructure renewal pressures,
and financial constraints.

The concern is that the long-term solution increasingly appears to rely upon transferring costs back onto the community rather than addressing underlying structural sustainability issues.

INCOMPLETE ASSET MANAGEMENT INFORMATION

The Open Spaces and Recreation Asset Management Plan itself acknowledges that it is only an “interim” plan, with asset data still being validated and progressively brought into Council’s system.

The document also admits current condition reporting should be treated with caution and may not accurately reflect future renewal liabilities.

This raises concern regarding:

the reliability of long-term infrastructure forecasting,
future unfunded renewal liabilities,
and whether the broader IP&R suite is being built upon incomplete asset information.

WORKFORCE RISKS

The Workforce Management Plan identifies significant workforce risks including:

over 50% of staff being aged over 51,
recruitment difficulties,
succession planning challenges,
and knowledge loss risks.

These are substantial operational risks for a small rural Council already operating under financial pressure.

CONCLUSION

Whilst the exhibited IP&R suite attempts to present a financially responsible and sustainable pathway forward, the detailed figures indicate:

extremely limited financial buffer capacity,
substantial long-term debt exposure,
growing dependence on reserves and external grants,
increasing cost pressures being transferred to the community,
incomplete asset data,
and significant future financial uncertainty.

I respectfully request that Council:

provide clearer and more transparent explanation of the organisation’s true long-term financial position,
clearly disclose total cumulative STP debt exposure,
provide more detailed reserve sustainability modelling,
explain long-term roads funding strategies,
and ensure the community fully understands the long-term implications of the proposed financial direction before adoption of the IP&R suite.

The Oberon community deserves full transparency regarding the financial sustainability challenges facing the organisation and the long-term impacts these decisions may have on future generations.

Yours faithfully,
Councillor Helen Hayden