I am sure many of you have had a similar experience when involved with volunteer committees or not-for-profit boards. The original reason that the committee/board/organisation was created was a very noble and worthwhile cause but in the process of generating funds to carry out said noble cause, the focus slowly morphs from carrying out the noble cause to becoming a group of people that spend all of their time fundraising and trying to generate enough money to…actually what was the reason for existing again? Generating the funds to run an organisation often becomes so important that the original focus is lost.
Councils are no different. Parramatta City Council is currently exploring the possibility of selling advertising space. This doesn’t seem that extraordinary – many Councils sell advertising on various facilities. We have advertising at our Airport as a simple example. The Parramatta situation is a little different though. They are looking at the possibility of selling advertising space on their roads. The Parramatta Mayor, Clr John Chedid, predicted it could generate as much as $50,000 within two months of starting if the proposal goes ahead. There are a variety of opinions in relation to this proposal that relate to safety issues and the need for Councils to work so hard with different ideas to try and generate additional revenue. Some pundits have pointed to the hypocrisy of a Council proposing advertising on roads (to generate income) when it was only months ago that the NSW Roads Minister, Duncan Gay, had a rainbow crossing removed from Oxford Street to protect pedestrian safety.
From my perspective, the most telling comment came from a Parramatta Council spokesperson who said, “Councils can only raise rates by a certain amount each year, despite the fact that we’re being expected to provide more and more services and facilities. It makes sense to at least consider new funding sources. We owe it to our ratepayers to at least look at other options.”
I agree entirely with the sentiment. Councils do need to look at other options for funding and be creative with ways to generate additional income. Unfortunately there is the risk that while a Council is working out different methods to generate additional income, the core basics of Council can be missed. Councils often become involved in a range of ventures to generate additional income – which consume a huge amount of time and energy and ultimately you have to question whether this is the best way for local government to deliver services to a community. There are 38 Councils in the Sydney area and if I just pick one at random, the City of Sydney Council, you gain a small appreciation of the ventures conducted by Councils. The area of this Council is only 26.15 square kilometres (compared to 3,425 for Dubbo) and the population is about four times that of Dubbo. With such a small area then it is hard to imagine they are only taking care of the basics with an annual budget of $430 million and 1,700 staff (including roles such as a New Year’s Eve fireworks co-ordinator; a public art conservator and early childhood teachers). They currently run four childcare centres with another six planned. I am not trying to be critical of the City of Sydney Council here – it is just an example of the various ventures that Councils find themselves involved in to make ends meet or to meet the needs of their community.
Ultimately, after an exhaustive local government review process by the State Government, I think there has to be a better way for all 152 local governments across the State to fund their local requirements. Expecting Councils to put away the conservative, low-risk approach of using public money and be expert entrepreneurs is fraught with danger. It may be successful in some areas but may end disastrously in other areas. I know of one Council that has recently taken on the role of promoter by paying an organisation a large sum of money for their City to host an outdoor event – with the view that the Council will make a tidy profit if all goes according to plan. Many years ago I was involved with a Rotary Club in organising outdoor concerts with high-profile musical artists. These can definitely be profitable ventures if all the ducks are lined up but, a sudden thunderstorm or an event occurring outside of your control, and the organisations, artists and equipment hirers still need to be paid but consumers are not bound to buy tickets. My Rotary Club eventually stopped putting on the concerts due to the high risk as opposed to the potential reward. For an entrepreneur doing this with their own money I have no problem – for a Council doing the same with public money raises some different issues.
I wish Parramatta City Council the best of success with their idea to generate additional revenue, but I wish the new Minister for Local Government, Paul Toole, even more luck as he tries to find a way to help 152 Councils deliver the services each community requires without expecting all Councils to be entrepreneurial experts.
Tell me if you think Councils can be inherently entrepreneurial at email@example.com.