Audited financial statements for the last twelve months show that the City of Newcastle lifted its infrastructure spend by more than ten percent, to a record $102.4 million, to counter the impact of COVID-19 on the local economy.
The record infrastructure spend, combined with a decision to put more than $10 million away for the future remediation of the long closed Astra Street waste facility meant the City of Newcastle’s operating result from continuing operations was a cash reserves funded deficit of $4.4 million compared with a forecast surplus of $1.6 million.
The deficit with income from grants and contributions for capital purposes, was a cash reserves funded deficit of $32.5 million compared to a budgeted deficit of $22.7 million.
Despite the COVID-19 hit budget, CN remains in a strong financial position on the back of long-term prudent and progressive economic management, with total cash and investment reserves of $366 million, including unrestricted cash reserves of $22.6 million.
Newcastle Lord Mayor Nuatali Nelmes said City of Newcastle made a conscious choice during the early stages of the pandemic in 2020 to support the community with a $5.5 million Community and Economic Resilience Package and increased capital works budget.
“During COVID-19, Council decided to provide financial relief and support for vulnerable groups and business, and to expand existing services, while increasing investment in projects to stimulate the local economy and support jobs,” Cr Nelmes said.
“This included investing a record $102.4 million across the city through our capital works program in 2020/21 to provide upgraded or new community infrastructure that delivers real benefits for our community in their everyday lives.
“These crucial decisions were only possible due to our strong financial sustainability, a legacy of six consecutive surplus Budgets prior to the pandemic.
“We expected COVID-19 to place further strain on our community and our budget, however as a Council we understand the importance of providing targeted responses and support for those in need and our local economy.
City of Newcastle CEO Jeremy Bath said six years of consecutive budget surpluses had provided Council with the cash reserves to run a stimulus program during the worst of the pandemic.
“It’s been an extraordinary 18 months for the City of Newcastle. Despite the repeated hits from having to close down so many of our income generating services, we were able to avoid laying off staff, cutting community grants or suspending infrastructure projects.
“With the city now almost at 80% fully vaccinated, we can look forward with real optimism to Newcastle bouncing back to a stronger position than before the pandemic struck. For City of Newcastle, it will be a gradual return to profitability given the impact of the recent lockdown. Despite this we have set ourselves the challenge of lifting our infrastructure spend even higher over the coming year to ensure the local economy rebounds as quickly as possible”, he said.
In 2020/21 City of Newcastle also committed an additional $10 million to remediation work at Astra Street which will include final capping and reprofiling of the site, drainage improvements to aid in management of surface water and sediment runoff, followed by revegetation and landscaping.
