Hepburn Shire Council has released its Draft Budget for 2026/27 for community consultation. The budget sets out how Council plans to raise and spend funds over the coming financial year.
While the budget is responsible, there is absolutely no room for error. As the summary below shows, Council only has $705,000 in unrestricted cash, or less than a week’s worth of discretionary spending. This puts Council in a risky position in the short term. In particular, it will be extremely difficult for Council to fund significant unplanned events like storm damage and it will have to manage cash flow carefully.
Although it is projected that there will be improvement in the medium term, the tight budget and rate capping makes it difficult to manage employee wage increases and depreciation in the future. The Council remains extremely reliant on capital and operating grants from the Commonwealth and the States.
Without further structural change to either increase revenue or reduce expenditure, there is a significant risk that Councill finances will become unsustainable in the medium term.
At a Glance
| 2026/27 Budget | |
|---|---|
| Total income | $43.9 million |
| Total expenditure | $43.4 million |
| Operating surplus | $511,000 |
| Capital works program | $10.5 million |
| Average rate increase | 2.75% |
| Total rates and charges revenue | $29.5 million |
| Cash and investments (end of year) | $9.2 million |
Rates and Charges
Council’s average rate increase for 2026/27 is 2.75%, in line with the rate cap set by the Victorian Government’s Fair Go Rates System. The actual change on any individual property will depend on how that property’s valuation has moved relative to the Shire average — ratepayers whose property value grew faster than average may see a larger increase, while those whose value grew more slowly may see a smaller rise or even a reduction.
In a positive development for households, the standard annual kerbside waste collection fee will fall from $610 to $540— a reduction of $70, or more than 11% — reflecting efficiencies in Council’s waste services. This covers fortnightly garbage collection, recycling, and weekly food and organics (FOGO) collection, equating to around $10.38 per week.
Financial Position
Council is projecting an operating surplus of $511,000 for 2026/27, a $289,000 improvement on the 2025/26 forecast. This improvement reflects a reduction in operating expenditure — down $1 million on the prior year — driven largely by a scaled-back special projects program and a thorough review of departmental budgets.
However, the adjusted underlying result — which removes one-off capital grants and non-monetary contributions to give a clearer picture of financial sustainability — shows a deficit of $600,000. Council has acknowledged this position and projects it will improve over the coming years as the Financial Vision 2024–2027 takes effect.
Council’s net assets (its overall financial worth) are expected to grow by $27.3 million to $559.8 million, largely reflecting the anticipated revaluation of property and infrastructure assets.
Unrestricted cash at 30 June 2027 is forecast at $705,000 — a modest buffer that Council acknowledges leaves limited room for unexpected events, though it notes a range of levers are available if required.
Capital Works
The 2026/27 capital works program totals $10.5 million, funded through Council cash, reserves, and $2.8 million in external grants and contributions. No new borrowings are planned.
The program prioritises completing projects already underway and renewing existing assets, rather than creating new infrastructure. Key initiatives include:
- Construction works on upgrades to the Glenlyon Pavilion
- Presenting the Clunes Flood Study to Council for consideration
- Finalising a masterplan for the Clunes Recreation (Bull Milgate) Reserve, including schematic design for the Clunes Community Centre and Netball Pavilion
- Implementing recommendations from the Aquatics service review
Services
Council delivers a broad range of services across three strategic domains drawn from the Council Plan 2025–2029. There are no material changes to services proposed for 2026/27.
Hepburn Life — focused on community health, wellbeing, and inclusion — encompasses building services, environmental health, libraries, early years services, compliance, emergency management, community wellbeing, and youth services.
Future Hepburn — focused on infrastructure, environment, and economic development — covers roads and drainage, parks and open spaces, statutory and strategic planning, waste management, economic development and tourism, biodiversity, sustainability, and property management.
Hepburn Working Together — focused on governance and organisational capability — covers financial services, governance and risk, technology services, and people and capability.
Looking Ahead
Council notes it faces a difficult operating environment, including rising fuel and legal costs, broader inflationary pressures, and the ongoing impacts of natural disasters such as storms and floods. It has called on state and federal governments to provide greater support to local councils, warning that continued inaction may leave councils with no choice but to reduce services in future years.
A comprehensive review of the 10-year Financial Plan is budgeted for 2026/27, alongside an external review of progress against the Financial Vision 2024–2027. Council has committed to continuing regular financial reporting to the community throughout the year.
Have Your Say
The Draft Budget 2026/27 is open for community consultation. Residents and ratepayers are encouraged to review the full document and provide feedback to Council before the budget is formally adopted.
For more information, contact Hepburn Shire Council or visit the Council website.
