‘Big, unbelievable’ debt not sustainable

The Clutha District Council offices in Balclutha. PHOTO: Google
The Clutha District Council offices in Balclutha. Photo: Google
A former senior staff member says he has serious concerns the Clutha District Council is generating a "tsunami of debt".

About 120 people last night attended a ratepayers meeting held by recently formed group Clutha Concerned Citizens at Milton’s Coronation Hall.

Among the speakers at last night’s meeting, organised by group spokesman Phil Barrett, was the council’s former corporate services group manager Alan Dickson, who resigned from the council after 16 years in 2016.

Mr Dickson said he had been asked by the group to examine the council’s debt and wider financial figures, some of which were recently released as part of the council’s own draft long-term plan documentation.

He said he had a range of concerns about aspects of the council’s accounting and about its accrual of what he termed a "tsunami of debt" to pay for capital projects.

He said the latest figures released by the council showed total debt (external and internal) amounted to $142 million as of June 2023.

Phil Barrett
Phil Barrett
By the end of the coming financial year, the figures showed external debt of $111.5m and internal debt of $106m.

Mr Dickson said this was "unsustainable" and could entail total council debt of up to half-a-billion dollars by the end of the current 10-year long-term plan.

"I know we want clean water and so on, but at what cost?

"There’s no point in bankrupting the people who pay your wages and your bills in the process. I believe the council needs to carry out capital projects mindfully and in stages and with the impact on ratepayers uppermost in its mind."

He said council debt was about $27m at the end of his tenure in 2016.

"These latest figures are just big, unbelievable numbers. It’s not sustainable in the long run."

Mr Dickson said he had further questions about the nature and potential rates impact of "internal debt", which appeared to consist of cross-departmental borrowing from internal budgets.

Interest on the council’s debts did not appear to be calculated consistently from year to year, he said.

"I’ll be asking council about this as part of my submission to the long-term plan."

Meeting organiser Mr Barrett said the group would continue to work "within the system we’ve got" to address ratepayers’ concerns.