Message from Mayor Zoe Baker

I have prepared this statement to explain why Council cancelled the Extraordinary Council meeting scheduled for 18 October 2022.

The purpose of the meeting was to present the audited financial reports, together with the external auditor’s report, to Council.  This is an annual requirement under the Local Government Act.

Council’s finance team prepared the financial statements in a timely manner. In September, while the audit was being completed, significant variations to the cost of the North Sydney Olympic Pool redevelopment were lodged. As these had not been formally reviewed and approved, the claims were noted in the covering report to Council’s Audit, Risk and Improvement Committee.

On 7 October 2022 the Audit, Risk and Improvement Committee resolved:

1. THAT consideration of the Financial Statements for the Year Ended 30 June 2022 be deferred to allow legal advice to be obtained; clarification of the quantum and validity of variations and the appropriate accounting treatments and disclosures to be made in relation to the North Sydney Olympic pool redevelopment contract.

2. THAT the Committee recommends that Council staff seek a one-month lodgement extension for the annual accounts from the Office of Local Government.

3. THAT a special meeting of the Committee be arranged to consider the Financial Statements for the Year Ended 30 June 2022 in accordance with the revised timetable.”

Council has requested an extension of time to finalise the financial statements and it is anticipated these will be presented to Council for endorsement on or before 30 November 2022.

The position taken by Council’s auditors, finance team and the Audit Risk and Improvement Committee is the right course – it is transparent and ensures that Council discloses what it knows about the financial risks arising from the NSOP redevelopment project.

Rest assured that Council’s internal and external audit advice is that Council’s finances remain strong and sound. 

Clearly, though, cost variations and delays to the NSOP redevelopment must be carefully monitored and managed. To ensure we are able to deliver the project, I tabled a Mayoral Minute on 10 October, 2022 calling for an urgent independent review of the NSOP project, which was supported by the Council.

This new Council inherited the project in the form, scale and costs set by the previous Council (2017-2021).  We are determined to deliver the pool and address the financial sustainability of the project. Since the Acting General Manager, Robert Emerson, was appointed on 23 May 2022, Council has:

  • commissioned and received a new business case with modelling based on the historical usage data from the pool
  • established a new transparent governance structure
  • appointed a probity adviser for the project
  • developed new financial modelling
  • called for a report on operational models for the pool following completion of the project; and
  • commenced an independent review of the management of the project.

The independent review will include recommendations for how we can best manage the project over the remainder of the construction period.    

This new Council is committed to transparency and we will provide as much information as possible (only limited by the strictures of commercial-in-confidence and legal professional privilege).

We will continue to keep you informed.

 Cr Zoe Baker, Mayor

Posted on 18 October 2022

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North Sydney Council