The NSW Government again stands accused of trying to force councils to fully account for Rural Fire Service (TFS) assets they neither own nor control.
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The so-called "red fleet" issue has been a major bone of contention between councils and the State Government, with councils alleging the move is just an accounting rort that makes council books look worse and State Government accounts look better.
The dispute saw a number of councils receive qualified audits from the NSW Auditor General in 2023, because they utilised their right to leave the depreciation of the NSW Government's RFS assets such as fire engines and equipment off their books.
The choice to include or leave out the assets was allowed by the government's own Local Government Code of Accounting Practice - but Local Government NSW (LGNSW) has learned the Code was quietly amended just before Christmas 2023, when councils and their communities were on leave.
Kempsey Shire Mayor, Leo Hauville, says he is 'gobsmacked' by the governments' amendment of the rules over Christmas break when councils were closed.
He says it is a prime example of cost-shifting that is causing difficulties for local government and ratepayers.
"We shouldn't be having this cost shifting," said Mr Hauville.
"They are going to try and put the RFS fleet on council's accounting of the budget.
"We are expected to depreciate its' vehicles that we did not purchase, we do not sell, and we do not get to decide where those trucks are stationed, yet we are expected to depreciate them."
In July 2022 Kempsey councillors unanimously voted to support an action to send letters to all members in parliament to stop the RFS asset shift from occurring.
"Their reply was basically we are not going make changes, and this current government is doing the same," said Mr Hauville.
An analysis by independent consultants Morrison Low calculated that the total cost shifted onto councils in the 2021/22 financial year was $1.36 billion.
"Without that figure would have a surplus budget and no need for any Special Rate Variation application," said Mr Hauville.
"This happening across New South Wales, not just Kempsey, and the NSW government is making it a very hard time for local councils to balance their books."
Mr Hauville says it is outrageous that this cost-shifting is happening at the same time they are launching an investigation into financial sustainability into councils.
LGNSW President Cr Darriea Turley said there was no notification of the change, and councils still had not been advised of the change by the Office of Local Government.
"Even more surprising is that this change has been made while the NSW Government has announced the parliamentary Public Accounts Committee will inquire into who should have responsibility for the red fleet," Cr Turley said.
"The Public Accounts Committee is being completely undermined by this decision.
"It was the Minister for Local Government who established the Public Accounts Committee review and yet now it's his department's decision to subvert any decision it may recommend."
Cr Turley called on Premier Chris Minns to have his government reverse the decision and let the Public Accounts Committee do its job.
"This convenient legislative fiction doesn't ring true to anyone," he said.
"Our communities know and understand the critical nature of the work carried out by the RFS, not only in rural and regional communities, but also in metropolitan areas where they are a first response emergency agency for houses and multi-storey buildings in our newer suburbs.
"For the NSW Government to continue to argue that councils are truly in control of these assets is laughable.
"They are a state asset and should be reflected in State Government accounts," Cr Turley said.
