Isaac Looks To The Future With Proposed $500 Million Fund

Isaac Regional Council is proposing a new Future Fund designed to help protect community services and financial sustainability for future generations as the region prepares for the long-term impacts of a changing mining industry. Photo supplied

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Isaac Regional Council is proposing the creation of a long-term Future Fund designed to help safeguard essential services and financial stability for future generations as the region prepares for life beyond mining.

The proposed Isaac Future Fund would gradually build a financial reserve using a portion of the region's current mining-related prosperity, with the aim of offsetting future revenue losses when mining activity eventually declines.

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Currently, almost 70 per cent of the council's rates income comes from the mining sector, creating what council describes as a significant future challenge when mines are decommissioned and mining leases are recategorised.

To establish the fund, council is proposing to reduce the early payment rates discount for mining leases, workforce accommodation and renewable energy projects from 10 per cent to five per cent this year, before removing the remaining five per cent next year. All other ratepayer categories would continue to receive the full 10 per cent early payment discount.

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The change is expected to contribute approximately $3.2 million to the fund in its first year.

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Isaac Regional Council Mayor Kelly Vea Vea said the initiative was focused on protecting future communities from substantial rate increases needed to maintain services once mining revenue begins to decline.

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“The Future Fund is a long-term strategy intended to grow our own funds over the decades and used to replace mining sector income to maintain services to communities when mining eventually declines,” Mayor Vea Vea said.

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“We cannot rely on future governments to subsidise services and infrastructure when funding to local councils has already been reducing over time. Our Council knows that we need to generate our own revenue source to protect future generations from the long-term financial impact that is inevitable when we are so financially reliant on mining.”

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Council said the fund would not be financed by general ratepayers and would be protected from being spent for decades while it continues to grow.

Once the fund reaches approximately $50 million, and subject to the necessary approvals, council intends to invest the money through the Queensland Investment Corporation to generate additional returns, with earnings reinvested back into the fund.

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The long-term target is to grow the Future Fund to around $500 million while preserving the principal for future generations.

Mayor Vea Vea said the proposal reflected responsible long-term planning for the region.

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“Smart regions plan ahead and responsible leadership means thinking long term and beyond the next election or budget cycle. There are many hoops to jump through and a lot of work to do in order to get the Future Fund to where it needs to be. We have to start now.”

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Council has spent the past 12 months developing the proposal in consultation with the Queensland Treasury Corporation and pointed to similar investment funds established by other regional councils, including Western Downs.

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The Future Fund would remain subject to council governance, auditing and reporting requirements, with any future investment arrangements required to comply with Queensland local government legislation and council policies.

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