MAYOR Jon Raven has welcomed a Queensland government taskforce designed to help council tackle the “growing challenges” of asset depreciation.
The taskforce, announced last week, will focus on improving councils’ understanding and management of depreciating assets like roads, water, sewerage, parks, and buildings.
Cr Raven said Logan City Council welcomed the government focusing on the issue.
“Depreciation is crippling local government in Queensland. But other states don’t have the same issue due to the size and scale of the infrastructure managed by Queensland councils,” he said.
“There are also differences around what assets need to be depreciated. In Queensland, when the state government or a developer builds new infrastructure that councils are responsible for managing, we have to set money aside to depreciate it, even if we know we will not be expected to replace it.”
Earlier this year, the mayor said two-thirds of last year’s rate increase was put into council’s depreciation reserve.
“… that we don’t get to touch for 10 years,” he said in February.
The state government said the taskforce would help councils “reduce the impact” of depreciation on their sustainability.
The Minister for Local Government, Ann Leahy, said the taskforce’s “end game” was to find savings and pass them on to ratepayers. .
“We are seeing councils struggle with soaring costs and the effects of depreciation to their budgets, and it’s clear that the issue must be addressed,” she said.
“Calculating depreciation over the forward years is challenging and we are seeing some councils facing significant losses due to the devaluation.”
The taskforce will deliver its final report to Ms Leahy in December.
