Thursday, Apr 21, 2016 at 23:25
Anthony, if the shires were running a business, in the form of tourist accommodation, they would be obligated to run that business at a profit - or they would rapidly accumulate increasing losses until they were bankrupt.
As it stands, shires can compete with caravan parks and other town businesses by hiding the true operating costs of their tourist accommodation sites, in the overall operating costs of the shire.
Then we have "creative accounting" by shire CEO's who can manipulate figures to show anything they like.
Shires get huge income via Govt grants, the income from their ratepayers is usually only a smaller percentage of their income.
They have no need to show profits - like all Govt entities, they spend to the level of grants and rates that they get.
It's called a "level playing field" when you are trying to work against unfair competition, who do not have the same cost structure as you - nor have any need to produce a profit to survive.
In the case of the shire council that dudded me - I was doing all the shire road
clearing (for road widening), and all their gravel stockpiling - and they got excellent value for money spent. They did not own a bulldozer, nor a low-loader.
However, the shire CEO decided that they could do the work with their own bulldozer more cheaply, and showed dodgy figures to councillors how cheaply they could do their own work with their own bulldozer. They accordingly bought their own bulldozer.
The shire CEO did not include the additional cost of having to purchase a low loader just to transport their own bulldozer - and he didn't have to justify his bulldozer purchase in the following years, by producing the ACTUAL OPERATING COST figures for their bulldozer and low loader.
As result, he couldn't care less what their own bulldozer was costing in operating costs, as compared to my previous contract bulldozing costs.
The shires name is irrelevant at this point. This episode was in the early 1980's, and it's water under the bridge.
There's only about 4 businesses left in that town, when there were double that number when I lived there - and the shire has had a good hand in ensuring that.
As to the ratepayers hiring plant and paying for it -
well the CEO decided that every operating hour of the plant incurred an hourly depreciation cost, so that was where the hourly hire figure for ratepayers came from.
Cheers, Ron.
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