LAKE Macquarie City Council’s infrastructure backlog has blown out from $93 million to $108 million in the past year.
This massive bill – of which all councils have their own versions – is defined as the cost to bring infrastructure to a satisfactory standard.
Newcastle City Council’s backlog was $98million last year and across NSW the figure is estimated at more than $7billion.
A Lake Macquarie council report said it ‘‘continues to have difficulties in addressing the increasing infrastructure gap’’. The report said the figure ‘‘highlights the gap between required and annual maintenance expenditure’’.
‘‘Council continues to strive for full cash funding of its annual depreciation expense in order to fund the replacement of assets when required.’’
A NSW Local Government Review Panel 2013 report said council data on infrastructure backlogs was ‘‘widely considered to be unreliable and is likely to overstate the real cost of bringing assets to a satisfactory standard’’.
‘‘Where councils rigorously review cost estimates and consult their communities to determine realistic, affordable levels of service, the consequence is often very considerable reductions,’’ it said.
However, the report said extra spending on maintenance and renewal was needed to ensure assets would not deteriorate.
A Lake Macquarie council statement said its backlog increase was mainly due to the Office of Local Government changing guidelines for what was considered satisfactory.
It partly attributed the increase to construction-cost rises.
If the backlog was not tackled over the long term, ‘‘it may lead to an overall deterioration of asset condition’’, the council said.
It was ‘‘working to address this’’ through its asset management and long-term financial plans.
As previously reported, the panel recommended that Lake Macquarie and Newcastle councils merge.
Lake Macquarie residential ratepayers have already been hit with an average rate rise of 55 per cent over seven years.
And they could face more rate rises above inflation in future, regardless of any merger.
The panel recommended rate-pegging be reviewed ‘‘in the context of a wider effort to address infrastructure backlogs and ensure financial sustainability’’.
Councils often blame their financial problems on cost shifting and a lack of help from federal and state governments.
However, the panel said ‘‘cost-shifting has been overstated relative to other factors’’ and councils ‘‘need to face the reality that there are no pots of gold in Canberra or Macquarie Street’’.
Lake Macquarie City Council infrastructure backlog
Roads (includes footpaths and kerb and guttering) $93 million
Buildings $5.7 million
Open space and parks $3 million
Swimming pools $751,000