Financial Ratios


The Financial Health Indicator (FHI) is a measurement of a local government’s overall financial health. It is calculated from the seven financial ratios that local governments are required to calculate annually. An FHI result of 70 and above indicates sound financial health. The maximum result achievable is 100. The FHI is one factor to consider in assessing overall performance. Other factors include: the range of services offered; efficiency of services delivered; and community satisfaction. A very high or low FHI may be a prompt for questions to be asked by the community about a local government’s revenue, expenses and service delivery. The FHI is best viewed as a trend over time. When interpreting FHI data on the radar charts below, a larger rounder shape is better than a smaller shape. Ratio results that a closer to the centre indicate areas where attention may be required and improvement can be made. Find out more information about the FHI methodology (DOCX 1.4MB).

DATA SOURCE: Calculation from financial ratios published in the local government’s Annual Financial Report

* Indicates data is unavailable.

Financial Health Indicator Comparisons


This table provides a comparison of Financial Health Indicator results.

DATA SOURCE: Calculation from financial ratios published in the local government’s Annual Financial Report

 90-100  70-89  50-69  0-49
* Indicates data is unavailable.

Revenue


A local government’s revenue comprises all sources of money that contribute to its operating budget. Local governments in Western Australia generate revenue from rates, fees and charges for services, and grants from the State and Commonwealth governments. In some cases, local governments also receive funding through property-developer contributions and sales of assets and property.

DATA SOURCE: Local government’s Annual Financial Report

Cash Reserves


Local governments are permitted to set aside money to be used for designated purposes in a future financial year. Reserve accounts may be created for future asset upgrades or replacements, employee costs, specific projects or a number of other initiatives.

DATA SOURCE: Local government Annual Financial Report

Operating Expenditure by Program


Under the Local Government Act 1995, councils must vote to accept an annual budget that sets out the local government’s spending priorities. A local government’s annual budget is informed by its Strategic Community Plan which is developed with the community. Engaging with the community enables a local government to be responsive to community needs and ensures that expenditure and prioritisation of public funds is in line with community expectations. The Local Government (Financial Management) Regulations 1996 specify 11 broad program areas that local governments are to use when reporting expenditure. These program areas are defined below.

DATA SOURCE: Western Australian Local Government Grants Commission

Expenditure by Nature & Type


Local governments are required to report their expenditure by nature and type. Expenditure is classified into five categories defined in the Western Australian Local Government Accounting Manual.

DATA SOURCE: Western Australian Local Government Grants Commission

Rate Growth


Rates are a tax on property levied by local governments to fund the shortfall between their planned expenditure and all other income they receive, including from local government grants. The Local Government Act 1995 and the Valuation of Land Act 1978 prescribe the methods for assessing the rateable value of property and the types of rates which can be levied. Each local government determines a rate in the dollar which is multiplied by the assigned value of the property. Rate revenue includes general rates, differential rates, specific area rates, minimum rates, interim rates, back rates, ex-gratia rates - less discounts offered. This does not include administration fees, interest on instalments, and interest on arrears or service charges. This graph shows the total growth in local government rate revenue for the local government selected. For more information about your rates contact your local government.

DATA SOURCE: Calculation from rate revenue published in the local government’s Annual Financial Report

* Indicates data is unavailable.

Additional Information


This table provides a comparison of demographic and other information.

DATA SOURCE: Local government Annual Financial Report, Australian Bureau of Statistics, Western Australian Local Government Grants Commission, West Australian Electoral Commission

* Indicates data is unavailable.

Total Councillor Renumeration


Councillors, including Mayors and Shire Presidents, receive meeting fees and may receive allowances or have certain council-related expenses reimbursed. The Local Government Act 1995 describes the types of fees, allowances and reimbursable expenses that council members are entitled to claim. The Salaries and Allowances Tribunal sets council member meeting fees and allowances payable. The Local Government (Financial Management) Regulations 1996 requires that local governments report the fees, allowances and reimbursed expenses paid to council members. This table shows the remuneration paid to council as a whole by payment type. This amount does not include interstate and overseas travel paid for by local government or third-parties undertaken on council business.

DATA SOURCE: Local government Annual Financial Report