Shire readies razor for 12% cuts

CAN Banana Shire find $7.68 million in savings without cutting services?

That is the massive challenge Mayor Ron Carige will discuss with his councillors when they sit down to work through the budget.

Cr Carige's task comes after Premier Campbell Newmann and Local Government Minister David Crisifulli outlined the dire state of the state's finances and advised council could no longer rely on grants and handouts from the Queensland Government.

"The next four years will be tough for all councils, and we have an obligation to our residents to get the best bang for our buck," Cr Carige said.

"If that means some belt tightening, then so be it. The shire will have to be proactive when dealing with resource companies who want to invest in our shire to ensure the council has adequate funding for necessary infrastructure."

Deputy Mayor Warren Middleton accompanied Cr Carige to the Civic Leaders Forum early this month, where Premier Newman delivered his address.

"The Premier did not pull any punches when discussing the state's financial position," Cr Carige said.

"He left no doubt in our minds that the debt burden is in the vicinity of $60 billion and, if not reined in, future interest payments could reach a staggering $700,000 per hour.

"Local Government Minister David Crisifulli urged councils to be more innovative and consider every opportunity available to enter into partnership with private enterprise, stressing councils should not sit back and wait for money to rain from above because it simply won't be happening until we have State debt under control."

Cr Carige said Local Government Association president Paul Bell called on councils to look hard at their budgets to find 12% efficiencies.

"That's the alternative to slashing services and reducing capital expenditure.

"I intend to discuss this challenge with councillors and senior staff."

The council's operating expenditure in 2011/12 was $67,428,744 (this does not include depreciation of $10,195,600), but includes $24,716,596 in flood damage. A 12% drop in operating expenditure equates to $7.68 million.