HUON / D’ENTRECASTEAUX BOUNDARY ADJUSTMENT
HUON VALLEY COUNCIL is seeking ratepayer feedback on a proposal to change the boundary of the Huon Municipality by including all of the Channel area south of Margate, including Bruny Island. Deadline for comments: 12th August.
This would be a very significant change and we suggest you have a look at their proposal.
Click here for: Boundary adjustment information
The Cygnet Association would also be interested in your views: firstname.lastname@example.org
Local resident David de Burgh has had a good look and the Felmingham Report that HVC is presenting as the economic rationale for pursuing this project. Here is his opinion:
The Huon Valley Council has put the Huon D’Entrecasteaux Boundary Adjustment out for public comment via an online survey. The survey is accompanied by the Felmingham Report 2015 which the Council commissioned to provide an economic analysis of the proposal. The Huon D’Entrecasteaux Boundary Adjustment involves merging that part of Kingborough south of and including Margate (MS in the report) with the Huon Valley Council and is termed M1. It was compared against Huon Valley remaining as it is and against M2, a merger of Huon Valley with all of Kingborough except for Taroona.
The report concluded that M1 was by far the the most viable option. The M1 option produced an annual operating surplus of $3.5 million compared with the current Council’s surplus of $636,000, resulting, in a positive economic outcome for the area’s residents. When I first read the recommendation I was intrigued as to how the merger could produce a six-fold increase in Council’s operating surplus and so I decided to have a closer look at the Felmingham Report.
I discovered that the Felmingham Report contains a number of inconsistencies and questionable assumptions that in my opinion, invalidate its conclusion on the economic benefits of the M1 option. Chief among these is the assumption that a 65% increase in the Huon Valley Council’s population would only cause its expenses to increase by 17%. It is this assumption that is largely responsible for the impressive surplus calculated for the enlarged Council area.
To calculate the likely financial surplus for M1, the Report starts with the Huon Valley Council financials for 2010/11 and creates a new income and expenditure statement for M1. To the Huon Valley actuals it adds estimates to accommodate the additional MS area and population as follows:
The end result of this is summarised in Table 1 (Columns 2 and 3 numbers are taken directly from the Felmingham report):
The Report explains that the factor of 1.17 was chosen because it was the average weighted increase in the population of the M1 area between 2006 and 2011. What that has to do with the anticipated costs of servicing an additional 10,000 residents is never addressed. The seemingly obvious answer is that the 17% figure has no relevance to this calculation.
Elsewhere in the report a completely different method is used to calculate the decrease in expenses if Kingborough Council divested itself of the Taroona area. Here the Report suggests that because Kingborough, with a population of 34,000 is losing 3100 people, its expenses will reduce by 9.12% (3100/34,000). No explanation is given as to why this method isn’t applied to M1.
Table 2 shows the results If we do apply this same method to the M1 calculation.
Now the $3.5 million surplus has become a much more believable deficit of $1.4 million. This means M1 is the worst of the three options rather than the best. The best option is clearly M2 both on the total surplus and a per capita basis.
Other matters in the report that caused me concern included:
• The comparison table of financial statements uses the Surplus before “non cash assets identified” for the Huon Council but Surplus after “non cash assets identified” for the Kingborough Council. This gives a skewed view of the relative surplus of each Council.
• The 2010/11 financials are used for both Huon Valley and Kingborough when 2014/15 were available.
• Correctly, no increase factor is applied to the revenue of the three Huon Valley medical and child centres in the M1 calculation (as they won’t be affected by the merger) but the 1.17 factor is applied to the expenses of the centres.
• When comparing the 3 options in the summary of findings, a surplus for M2 of $1,242,000 is used instead of the report’s calculated figure of $2,965,000, understating the M2 surplus and per capita benefit by a factor of 2.4.
• The 10 year projections for the 3 options are calculated using the 1.17 factor. In this way M1 achieves a surplus of around $4.65 million in year 10 and an accumulated surplus over the 10 years of over $40 million. However if we use the starting point calculated in table 2 we end up instead with an accumulated deficit of $17 million. Straight line projections over such a long time period need to be treated with great care, especially if you have the wrong starting point.
After accepting the Felmingham report’s conclusion on the viability of the Huon D’Entrecasteau Boundary Adjustment, the Huon Valley Council developed a Community Engagement Plan. A report tabled at the June 22 Council Meeting reveals that “Through much deliberation” it was decided that an online survey would be “the most efficient and effective in ensuring broad engagement”.
The survey would “request a post code from respondents to clarify their location and understand where their interests lie”. The engagement will also “provide the means to inform the community about the current resource sharing arrangements between the Council and others so they can make an informed judgement “ .
The Plan was adopted by the Council, with only the Mayor and Cr Smith voting against it.
So what did the Community end up receiving to enable it to make an informed judgement?
Unfortunately not very much. Survey participants are invited to read the Felmingham Report but no other information concerning the proposal is provided. The promised information on resource sharing is not mentioned. The Felmingham Report is all you have to base your opinion on when you start the survey.
The greatest attribute of the survey is its brevity. There are only 2 questions. The first one is whether you would like the Council to continue investigating the proposal. You have a choice of Yes or No. The second question is your post code. There is then a box where you can make a comment.
No questions to find out whether you would like a full merger with Kingborough or no merger at all. No questions that would provide useful information such as whether the participants were ratepayers, whether they were long term residents or recent arrivals, whether they were business owners, or were satisfied with the service level they currently received etc? Definitely not a survey designed to learn very much. Also no illumination on how, by knowing your post code, the Council will “understand where your interests lie”.
So the Huon Valley Community is provided with a survey of questionable value about a project of questionable viability. Many of us wouldn’t need the help of an expensive academic report to tell us that adding Margate south including Bruny Island to Huon Valley Council would not create a financial utopia. Common sense would suffice for most Huon Valley residents.
It is disappointing that no one at the Council appears to have queried the figures in the report. Perhaps because the report told them what they wanted to hear they didn’t look too closely. I suspect that if the report had recommended the full merger with Kingborough as the most viable option (which it appears to be) the report would have been quietly buried.
From my analysis the Felmingham report should never have been used as the basis for pursuing the Huon D’Entrecasteau Boundary Adjustment. That it has, is an embarrassing and costly action by those Councillors and staff pushing this merger option.
- David de Burgh is a retired accountant and company director who has lived in the Huon Valley for 14 years. He served as a Councillor at the City of Melville in Western Australia from 1997 to 2001.
- Dr Bruce Felmingham has been invited to respond.
Pat Synge (13 July 2016)
The walking track alongside Lymington Road from Cygnet to the Sailing Club is much used and appreciated by many.
A short section has had drainage issues and some years ago the then Cygnet Township Development Committee asked HVC to do something about it. Now they have just started on an upgrade of this section. And what an upgrade!
As you can see they didn’t just put in some drainage and re-surface they are building a complete new raised section. This must be costing (us) plenty and has been undertaken with no community consultation.
For quite some time TCA have been lobbying HVC to do something about the dangerous section of road between the Sailing Club and the Public Jetty where there is NO footpath at all and pedestrians have to walk either on the road or the sloping verge. Between two blind corners this is a dangerous section of road and much used by pedestrians. It’s an accident waiting to happen.
Earlier this year we were told that there were “insufficient funds available” to build a footpath in this area but no one mentioned the tens of thousands of dollars that were about to be spent on the other section. So it goes.
I have contacted Simone Watson (HVC GM) for an explanation but have had no reply.
Update: 31st July 2016
I’ve not had any word back from Simone Watson but I understand that questions were asked about this at the recent HVC meeting (27/07/16) by a community member and that the GM responded that HVC had been notified that this was a dangerous section of footpath. When asked how much it was costing she seemingly doesn’t know.
TCA – Social meeting
7pm, Monday 29th August – back room @ Top Pub
We invite all TCA members and all other Cygnet residents to join us for an informal get together. The aim of the association is simply “to make Cygnet a better place to live and visit” and we would be interested in hearing your ideas on how our association can help achieve this.