Redland council deficit beats budget as capital works fall $35.35m short

Redland City Council’s provisional year-end figures show a $1.28 million operating deficit, but the result was $7.53 million better than its revised budget. Capital works spending, meanwhile, was $35.35 million below budget, affecting the pace of infrastructure delivery across the city.

The figures cover the year to 30 June 2026 and were noted by councillors on 15 July. They remain provisional while year-end accounting adjustments and external auditing are completed.

Council held $271.89 million in cash at 30 June, down from $293.31 million in May. The balance was above budget, largely because operating and capital payments were lower than expected and receipts from grants, subsidies, contributions and customer revenue were stronger than forecast.

Higher water-consumption revenue, early receipt of the 2026 - 2027 Financial Assistance Grant and stronger investment earnings supported the operating result. Those gains were partly offset by higher bulk-water costs, insurance claim-related expenses and finance costs linked to landfill remediation provisions.

Capital works expenditure was $35.35 million below budget because of project timing and progress, contractor availability and wetter-than-anticipated weather during the financial year. Council is monitoring project performance and milestones as works progress.

The Asset Sustainability Ratio was below target at the end of June and remained unfavourable year to date. Renewal spending on infrastructure assets was $45.42 million, compared with $83.56 million in year-to-date depreciation expense. The ratio can vary month to month depending on the timing of capital works, while non-renewal projects add to the asset base and depreciation expense.

Council expects the completed 2025 - 2026 outcome to be reported in audited financial statements in October 2026. Further adjustments are expected for accruals and deferrals, asset valuations and impairment assessments, depreciation, provisions and other statutory accounting requirements. The interim report was presented under section 204(2) of the Local Government Regulation 2012.