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Council to cut back on capital works in 2024-25

Rates and rubbish collection costs to increase by about $1.50 a week

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Mark Phillips

MERRI-BEK Council will significantly cut back its capital works spending in its 2024-25 budget as several major projects come to an end.

After spending a record $116.6 million this year, the council’s capital works program will be wound back to $83.1 million due to big ticket items such as the Saxon Street community arts hub in Brunswick being completed.

But in a report to accompany the budget that was presented to the council meeting on April 10, staff have warned that the forecast spending could be impacted by escalating construction costs due to supply chain issues, lack of resources and availability of contractors.

The council managed to contain these costs in 2023-24, with the capital program only exceeding what had been budgeted by 3.5%, but staff have warned “cost estimates will not be accurate and adjustments will need to be made through the year”.

“In addition, several large projects in 2023-24 have been impacted by discovery of contaminants, including in parkland, on brownfields redevelopment sites and within buildings,” the report said.

“Accurately predicting the extent and nature of contaminants has proven challenging and this is likely to continue into 2024-25.”

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Capital works highlights in 2024-25 will include completion of the $29 million Saxon Street cultural and community hub expected by the end of this year and the $36.9 million Fawkner Leisure Centre redevelopment which is due to open for next summer. Money has also been allocated to continue $22.2 million of upgrades to several early years’ facilities including Dunstan Reserve childcare centre and Brunswick Early Years Hub in Albert Street.

The operating projects budget of $6.4 million includes funding of $1 million for tree planting as part of the council’s urban forest strategy, $200,000 for a homelessness outreach program and an additional $60,000 to increase shopping street cleaning and rubbish collecting services.

The adoption of the Moving Around Merri-bek Transport Strategy will see extra spending on active transport infrastructure from $10 per person to $12 per person in future years.

The council is forecasting it will finish this financial year with an underlying operating surplus of $19.3 million and $17.8 million next year. Revenue is forecast to grow by 1.3% in 2024-25 to $269.8 million, with rates and charges making up 72% of that amount. Spending will grow by 2.9% to $232 million.

Total rates income will grow by 2.75% next year under the state government cap to $166.6 million, which will see the average property owner paying an extra $1 a week or $52.21 a year.

Standard kerbside waste collection charges will increase by 52 cents a week or $26.96 a year, which the council attributes due to the increased waste collection costs as well as an effective reduction in state government funding.

The council is also expecting a 6.1% increase in revenue from fines and fees to $18.4 million.

Employee costs of will grow by 2.75% to $111.9 million with the council employing 944.5 full-time equivalent staff in 2024-25, while expenditure on consultants and professionals will dip by 7.3% to $4.6 million.

Merri-bek Mayor Adam Pulford said the budget had been developed in a challenging economic environment and under the constraint of the state government’s rate cap of 2.75%.

“We know the continuing cost-of-living pressures are being felt by our community due to high inflation, however the rate cap set is lower than the inflation rate, which presents challenges for our budget,” he said.

“However, in the face of rising costs and challenges in some areas, I am proud to say we continue to deliver for our community while remaining in a strong, sustainable financial position.”

The council has also allocated $399,000 to six community projects which were chosen from 30 suggestions including $150,000 for sunshades over playgrounds around the city, $59,000 towards domestic violence prevention and $60,000 to install drinking fountains in shopping strips.

Community feedback on the proposed budget is open until May 17.

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