PURSE strings are tight at Tamworth Regional Council (TRC) as investment earnings plummet by $1.4 million amid the pandemic.
There was a 'glimmer of hope' as the Reserve Bank of Australia reported improvements in unemployment and higher spending, but it appears now those are 'indeed just glimmers', a report to councillors noted.
With no forecast increase to the cash rate, a low return on investments is expected to have a significant impact on the council's ability to spend on future projects.
At Tuesday night's council meeting, Cr Glenn Inglis said a lot of local councils rely on interest as a form of income, and Tamworth's had declined by 43 per cent.
"That doesn't matter if it's 100 bucks, but it does if you are talking about millions," he said.
"You crunch those numbers quickly, we are basically down $1.4 million this year.
"Over three years that's $4.2 million and that's a gap over a three year timeframe of $5.6 million - that's fairly serious money.
"As far as our 10-year financial plan goes, I would suggest we need to start out budget workshops sooner rather than later.
"There's things that have caused those problems for us that are out of our control, but one thing that is in our control is trying to find a solution."
At the start of the financial year, council predicted it would earn $3.2 million in interest income, but those forecasts have since dropped to $1.8 million as interest rates decline. The amount invested at January 31 has decreased by $4.4 million since December, last year.
The community shouldn't be concerned, Cr Col Murray said.
"In a $200 million budget there's a lot that can be massaged to restore that, the council isn't going broke and there isn't serious financial issues here," he said.
"But, we might have to say no to some of the requests for the smaller things until we can get the unrestricted cash number back to where it should be."
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