CCBR Business Review

7 No money to pay wages Minister appoints Interim Administrator B U S I N E S S N E W S IT TOOK A crisis that saw Central Coast Council unable to pay the wages bill that forced Minister for Local Government, Shelley Hancock MP, to “Suspend” Central Coast Council and appoint an “Interim” Administrator to take control of what now appears to have been a totally dysfunc- tional organisation. The appointment of Dick Persson AM, a career public servant and local govern- ment administrator with over 40 years’ experience, for a three month term that could be extended a further three months to come up with a range of options to solve Council’s financial woes that start with a deficit of $89 million but could be much more. Subsequently Mr Persson appointed Rik Hart, also a career public servant with con- siderable private sector and government experience in New Zealand and a former General Manager at City of Parramatta, Inner West and Warringah Councils span- ning 46 years, and now semi-retired, to oversee council’s operational recovery. Meanwhile Mr Persson has asked CEO, Gary Murphy to take leave while he carries out his investigation. Mr Persson’s first priority was to pay wages and also suppliers, many of whom are small local businesses where trading terms had been stretched beyond 120 days. This was achieved through an immediate loan facility with Council’s bankers. In a radio interview in mid-November Mr Persson said that while he would report on the financial situation within 30 days and advise a way forward he expects that he would take six months to complete his job. “This is a very serious financial problem,” he said. “I am not aware of any council who could not pay their wages and I don’t understand how they got into this position.” Since both councils were merged an additional 300 plus staff have been added to the payroll which was surprising because with most council mergers there’s a saving where senior staff are rationalised. Mr Persson emphasised the point that the merging of the two councils was not the reason for the debt. He also said that he was very impressed with Chief Financial Officer, Natalie Cowley who was appointed a few weeks prior to his appointment and is working through what went wrong. Ms Cowley is the fourth CFO in three years. Getting across local issues Towards the end of November Mr Persson announced that he had commenced site visits with senior staff to ensure he under- stands local issues across the Coast. “I am not from the Central Coast and am spending as much time as I can familiaris- ing myself with the region.” “I take every aspect of my role seriously, including being aware of issues that were important to residents and getting to know the Coast better. “I want to assure the Central Coast com- munity, that whilst my number one priority is delving into the financial crisis issue, I also want to understand more about this diverse region.  I can already see that the Coast has some complex matters, some of which relate to its diverse landscape and growth as a key regional NSW area” he said. Mr Persson has also initiated an open forum before every ordinary Council Meeting from Monday 23 November 2020.  Members of the public will be able to address Council, at the open forum, on any Council related matter they wish, but must register and will be limited to three minutes each. Following a request from Gosford Erina Business Chamber that Council meet- ings be held at least alternately between Gosford and Wyong Mr Persson was quick to respond agreeing to the change. Early in council’s life councillors refused to meet in Gosford claiming they were con- cerned about their personal safety. Central Coast Council Interim Administrator, Dick Persson AM CENTRAL COAST BUSINESS REVIEW DECEMBER 2020