Kiama Council's Financial Struggles: A Legacy of Overspending
Acting Kiama Mayor Melissa Matters has publicly acknowledged that Kiama Council has been living beyond its means for an extended period, describing a situation where expenditures have consistently outpaced revenues over many years. This revelation came during a recent council meeting, where Matters, serving as chair in the absence of Mayor Cameron McDonald, addressed mounting public criticism and proposed budget cuts.
Defending Leadership Amid Financial Turmoil
In a mayoral minute presented at the meeting, Matters strongly defended CEO Jane Stroud against recent online calls for her dismissal. She emphasized that Stroud, who assumed the CEO role in June 2021, inherited the council's financial issues and has worked diligently to resolve them. "These issues were not of her making, but she has worked tirelessly to resolve them. She, like the councillors, inherited these issues," Matters stated in her motion.
The council's financial challenges were formally identified in 2021 when the NSW state government issued a Performance Improvement Order, outlining 74 specific items requiring correction. To date, 69 of these items have been addressed, but one critical outstanding task is delivering a balanced budget by the 2026-27 financial year.
Audit Office Warnings and Historical Deficits
For the past four years, the Audit Office of NSW has consistently flagged Kiama Council as "not financially viable." Matters highlighted that in 2021, the council faced a staggering deficit of $28 million. "I am a small business owner and I am staggered Kiama Municipal Council was allowed to operate in that kind of debt position," she remarked, underscoring the severity of the financial mismanagement.
She further elaborated on the council's unsustainable practices, stating, "We have spent more than we earn for years and years. And it has to stop. The buck quite simply stops with us." This admission points to a long-standing pattern of structural deficits that have plagued the council's operations.
Proposed Measures and Community Impact
Facing rising costs, increased expenses, and higher community expectations, Matters acknowledged that difficult decisions are unavoidable. While expressing reluctance over potential staff reductions, she insisted that action is necessary to achieve financial stability. "Like a lot of our community, I don't like the idea of staff cuts at all. But with rising costs, higher expenses, higher expectations and so many services, something simply has to give," she explained.
Matters called for decisive steps to break the cycle of deficit spending, urging the council to "live within our means and take strides, not steps - strides, towards leaving a financial future for this community where this cycle of structural deficit circles stops." This statement reflects a commitment to transformative financial reforms aimed at securing the council's long-term viability and service delivery to the Kiama community.
