‘Traumatic’: Administrator’s plea for Coober Pedy fix

The outgoing administrator of the debt-ridden Coober Pedy District Council says his three years trying to improve the outback town’s finances have been “extremely difficult and quite traumatic”, as he again called for the state government to buy the town’s water and electricity assets.

Aug 17, 2022, updated Aug 17, 2022
Coober Pedy. Photo: Stephanie Richards/InDaily

Coober Pedy. Photo: Stephanie Richards/InDaily

Former Playford Council CEO Tim Jackson, who has been administrator of Coober Pedy council since the elected body was suspended in January 2019, says the Malinauskas Government must be prepared to make “difficult decisions” about Coober Pedy’s future to get it back on track.

The comments come after Local Government Minister Geoff Brock this week announced that a multi-agency taskforce led by the Department of Premier and Cabinet is being established to examine the debt-ridden council’s problems and determine a way forward.

The state government is also introducing legislation next month extending the council’s suspension as an elected body until 2026.

Jackson said he supported the move to keep the council in administration – but wouldn’t be continuing as administrator.

“It has been extremely difficult and quite traumatic,” Jackson said of his time in the role.

“There’s lots of litigation going on etc; I’ve had people banging on my window at 2:30 in the morning… so, yeah, it’s not been easy.

“Most of that has subsided… but it’s been challenging that’s for sure.”

We have to roll our debt over every six months, we have to go through a refinancing exercise every six months – it’s really, really difficult.

He said it was possible an elected Coober Pedy council could be reinstated before 2026, but “there’s a whole lot of things that need to happen”.

“We’ve stabilised the organisation, that’s the most important thing,” Jackson said.

“We’re certainly not out of the woods financially because the state government needs to make some crucial decisions.

“I think essentially the sort of dissension within the community has sort of subsided, not entirely but significantly.”

Coober Pedy District Council is unique in South Australia because it manages the provision of water and electricity services to ratepayers, along with the local airport and childcare centre.

The council still has more than $10m in debts to pay off to various creditors, including more than $7m owned to the Local Government Financing Authority and around $2m to the town’s electricity generator EDL.

“I’d love to be able to pay the EDL [debt] – it’s just unfortunate that the Local Government Finance Authority won’t lend us any money because we’re paying penalty interest on that debt,” Jackson said.

“So we have to roll our debt over every six months, we have to go through a refinancing exercise every six months – it’s really, really difficult.

“I just can’t believe the state government hasn’t stepped in and said, ‘we’ll help you out guys, we’ll at least guarantee your debt’.

“There are assets there, I mean there’s $14m worth of electricity and water assets, so it’s not like we’ve got nothing.”

Jackson wrote to Brock following the regional MP’s surprise cabinet appointment in March to outline that he “strongly support(s)” the state government purchasing Coober Pedy’s electricity and water assets “at their current value of $12m”.

“This would result in a much smaller and simpler Council,” Jackson wrote at the time.

“It would reduce the Council’s annual turnover from $16 million to $4 million and would result in assets being reduced from $30 million to $18 million.”

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He also told Brock the “water situation in Coober Pedy is now untenable” and called for $1.3m in temporary state government subsidies to ensure equitable pricing.

“The rate of water leakage and bursts from the ageing infrastructure is at a point that between 30 per cent and 50 per cent of water is wasted each year,” Jackson wrote.

“As a result, consumers pay three times what SA Water customers pay. This is inequitable and unacceptable.”

Brock told InDaily on Tuesday that it was up to the new multi-agency taskforce to determine what supports were necessary to help Coober Pedy and whether the state government should buy the Council’s utilities.

“People could say let’s give them $20m dollars or whatever it may be and sort their finances out, but we’ve got to address the issues,” Brock said.

“What is the symptom? That is what we’ve got to identify by having this group together.”

Brock, who is travelling to Coober Pedy next week, said the Office of Local Government would be running an expressions of interest process for Jackson’s replacement.

“Tim’s been doing a good job up there. It’s a challenging position to be in because there’s lots of issues to overcome,” Brock said.

“If Tim doesn’t want to extend his contract that’s fine, and I thank him for his efforts over the last four years – it’s been very hard.

“We’ll go for expressions of interest for another administrator and then when those expressions of interest come in, I’ll have the opportunity to make a final decision.”

Former Local Government Minister Stephan Knoll first appointed Jackson to a one-year term as administrator in January 2019.

That decision came after a 2018 report from Ombudsman Wayne Lines found Coober Pedy Council had been responsible for “one of the most serious examples of maladministration” he had ever seen regarding its decision to enter into a $198m electricity deal with EDL without going to tender.

An Auditor General report in 2018 also found multiple breaches of the council’s obligations under the Local Government Act and warned that it carried an unsustainable level of debt.

Shadow local government spokesperson Sam Telfer, a former Local Government Association president, said the Coober Pedy council and community “need a sustainable and affordable business model going forward to supply reliable water and electricity to the township”.

“The responsibility currently falls at the feet of the council but what Coober Pedy needs right now from Geoff Brock is less talk and more action,” Telfer said in a statement.

“The former Liberal Government tasked an administrator to streamline council processes and identify potential solutions to be considered.

“We are lobbying for the people of Coober Pedy to get the support they deserve, but Geoff Brock needs to stand up to his Labor colleagues and for the region to get the job done.”

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