Council accounting anomalies

Central Coast Council Photo: Justin StanleyCentral Coast Council Photo: Justin Stanley

Forum –

I refer to an article in the Community Coast News on August 21 titled “Council act on Auditor General Recommendations”, which includes an overview of how Central Coast Council manages contributions monies paid by developers.

(It included) disclosures, in the words of the NSW Auditor General, that: “Central Coast Council and the former Gosford City Council had spent $13.2M on administration costs in breach of the Environmental Planning and Assessment Act 1979”.

The Auditor’s report notes that this is the amount that was incorrectly used between 2001 and 2019 (three years after 2016 amalgamation).

While $13.2M may have been that actual amount misappropriated, the real cost to the contributions plans and Council is probably in the order of $20M by the time you factor in cumulative interest that was not earned over that period from these funds.

This is an incredible breach of trust by no doubt a range of senior managers both past and present.

To put this in perspective (leaving aside the loss of interest issue), this represents on average $0.5M per year, which broadly equates to 4 or 5 positions.

To my knowledge there were never more than two contributions positions in the Gosford Council.

And while in some instances, other staff time is needed to review and upgrade contribution plans, the sad fact is that there have been no reviews or amendments to any of the 40 odd Gosford Plans for at least 25 years.

So, the commentary in the Auditor’s Report indicating that 47 contributions of the 50 Central Coast Council contribution plans are more than 5 years old really understated the deplorable management of the Gosford Contributions plans.

How on earth could past and present managers justify this misappropriation of funds?

Did anyone raise this as an issue along the way?

What were the auditors doing?

How much went toward the salaries of overpaid managers?

The sad fact is that it is permissible for contributions plans to levy a charge for the administration of contribution plans and indeed most of the Wyong Contribution Plans have such a component.

So, if there had been anyone on the ball for the last 20 years, the Gosford Plans could have been amended to include such an administration charge.

And while it would appear current management has scurried to repay the money ahead of an adverse finding by the Auditor General, the question is where did the money come from?

In a roundabout way the residents of the former Wyong Shire will have subsidised 20 years of misappropriation by Gosford Council.

It is also beyond argument that the cost of administrating the Gosford Plans will now be subsidised by the administration charges collected under the Wyong Plan until a new plan is put in place.

One also laments the recent action by Council (as recommended by staff and management) to increase the contributions for granny flats in all the Wyong Contributions Plans, which includes an administration component.

I recently wrote about the complete inequity of increasing the charge for granny flats from 35% of the baseline subdivision rate to 73%, when an identical development under Gosford Plans ranges between 40% and 50%.

The story of contributions management just gets worse, when you recap on the: $12M loss in contributions from the Golf Driving range precinct in 2018 because there was not Gosford Contributions Plan and no voluntary planning agreement was negotiated with the developer at the time the DA was lodged; Initial proposal for the Levy Plan in 2018 to fund $107M of the $125M works schedule, without advising Council that levy plans do not require Council to fund shortfalls’ the doubling of contribution for granny flats in the Wyong Plan, without any examination of the underlying methodology and its inconsistency with the existing Gosford Plans; and the doubling of the Wyong Shire Wide Contributions (including administration component) for granny flats, when there is no comparable plan for Gosford.

The Auditor’s report is critical of Central Coast Senior Management who does not regularly attend Contribution Committee meetings – what more can I say.

The Auditor also cites the inadequate publication of Gosford Contributions plans on the Central Coast Website.

If you want to find out about contributions rates under a Gosford Contributions Plan – good luck, because you won’t find any information on the website.

Unfortunately, the good practice of providing a table of the current indexed contributions rates for residential developments in various parts of the former Wyong Shire appears to have been taken off the website in a move that reduces transparency to the level of the Gosford Plans.

The lights are on, but nobody is home.

Email, Sep 23
D. Kitson, Wamberal

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