But uncertainty over the state government’s plan to cap rates and the freezing of financial assistance grants from the federal government means the savings will be banked rather than directed towards new projects. 

The savings and a favourable cash surplus variance of $162,000 means the council’s forecast cash position is $5.52 million at June 30, 2015. 

Finance manager Kathy Crothers said the council’s financial performance for 2014-15 remained on target. 

“It’s important to note that no programs or projects have been cut to achieve these savings,” she said. 

“Most have been made due to timing and extra grants funding being made available.”

Savings were made in road sealing contracts, insurance premiums, WorkCover premiums and an ambulance lease, as well as a fire services levy grant, rates income, kindergarten grant and a general revaluation contract. 

Cr Peter Harkin said with changes coming it was wise to put cash aside. “We could be heading into tough uncertain times, so I think it’s good to put some cash away and build reserves,” he said. 

Cr Neil Trotter agreed, saying there will be implications from rate capping. “Rate capping has been in place in New South Wales for some time and has meant a reduction in service delivery,” he said. 

“We don’t know the consequences yet, so it’s prudent to be putting money away.”

Mayor Chris O’Connor said in past years any savings from the mid-year budget review were directed to projects. 

“We are heading into uncharted water with rate capping and the freezing of the Commonwealth assistance grants,” he said. 

“We can’t be complacent. We need to make use of every single dollar as we have already been doing, but it will be even more important in the future.” 

jwoolley@fairfaxmedia.com.au