Councils across South Australia are warning they may need to consider rate rises above inflation, defer capital works, reduce some services or increase borrowing to absorb the escalating costs of the fuel crisis.
The Mount Barker District Council is among those hardest hit, with fuel-related costs expected to add between $40,000 and $50,000 each month to its budget. The impact is creating uncertainty for one of the state’s fastest-growing regions, where road upgrades are critical to keeping pace with expanding housing developments and population growth.
Council reports indicate some infrastructure projects could now cost between 20 and 50 per cent more than originally planned, with the $2.25 million Bollen Road upgrade in western Mount Barker among works likely to face higher costs. The supply of bitumen is also uncertain beyond the short term, making it difficult for councils to lock in timelines for future road projects.
Some planned road works may be delayed while the Council seeks additional state and federal funding support. If the fuel crisis continues long term, the annual impact on the council’s budget could reach half a million dollars.
Regional councils are particularly exposed because of the vast distances involved in maintaining roads and transporting materials. Industry groups have also warned that rapidly rising bitumen prices are putting contractors at risk, with fixed-price public works contracts becoming increasingly difficult to sustain.
Council budgets are due to be adopted before the next financial year.
