ON June 28 Local Ipswich News went to its front page to reveal that our council was under a mountain of debt and it was currently sitting at $403m.
Since then, we have been asking Mayor Teresa Harding questions concerning this debt.
Initially the response from council was made under a “Ipswich Council spokesperson” and not the mayor.
After going back to get the mayor to make a comment “on record” she replied in a brief statement pointing the debt problem back to the previous council.
Her short reply was:
“I have always been concerned with the level of debt that had been accrued by the previous administration, as well as the significant amount of work required from this council to make up for the lack of planning and action to adequately prepare our city for the future.
This includes funds borrowed to purchase the Ipswich Mall in 2009, which was then left to fall into disrepair with net losses totalling $78 million.
Council’s record spending in the 2023-24 Budget on its capital works program and waste infrastructure and services are good examples of how this council is actually planning and delivering for residents now and well into the future.”
The mayor’s reply needs to be clarified as it is missing key background information.
Council’s debt in 2016-17 just before the previous council was marched out of office was $252.8m which means since that time the debt has increased by almost 60 per cent or more than $150m, not decreased.
The Pisasale led council bought the old CBD Mall for around $60m and of that loan its understood $22m is still on the books.
The missing $78m the mayor points to relates to the devaluing of purchased assets.
It would be more than reasonable to assume since that financial report was compiled some years ago the CBD assets have now risen significantly in value.
The question on how long it will take to get out of the red and into the black saw council provide the following information:
Council loans have final repayment dates between 2026 and 2041 and the existing loans carry interest rates of between 1.20 per cent and 6.11 per cent.
Further information on the debt in regards repayments and interest costs is available in Council’s Annual Plan on their website.
When you turn to pages 147-148 you will see that the forecast is that council will make repayments of $394m from now until 2031, but with more borrowings we will still have a $305m debt on the books. The interest to be paid over the period from 2022-2032 amounts to almost $118m.
CLARIFICATION:
In our previous story on council debt we reported that the much bigger Logan Council’s debt was lower than the current Ipswich figure.
We were given their net debt figure for the year, not their total debt. It is in fact slightly larger than Ipswich’s.
Lockyer and Scenic Rim debt figures were correct.
