A report into the performance of Victorian councils last financial year shows many are facing financial pressures, placing strain on their ability to deliver services and maintain infrastructure.

This is the case for the Rural City of Wangaratta, however, a report from the Victorian Auditor General Office (VAGO) on the 79 councils that submitted a report for 2024-25, indicates Wangaratta faired reasonable well under key performance indicators.

For example Wangaratta had a $4.9m surplus in 2024-25 and $27.54m cash on hand, while debt had reduced to $2.68m.

While Wangaratta is not an outlier in terms of cost pressures, the other smaller regional cities have tighter margins and less buffer than Wangaratta.

Data analysis of the 10 Victorian regional cities shows Wangaratta was near the top alongside Bendigo when it comes to operating performance, liquidity and debt, and governance and audit themes.

While Wangaratta noted increasing financial pressures, it was still within a framework of continued delivery of strategic objectives and major initiatives.

The VAGO report heard that Wangaratta rolled out major projects such as the sports and aquatic centre stadium and levee funding and strong community events that signaled ongoing investment despite cost pressures.

And while Wangaratta was not as revenue-diverse as Geelong, Bendigo and Ballarat, it was generally more stable than the smallest or most constrained, for example Horsham.

It was also less growth-debt-intensive than Wodonga or some growth focused cities.

In terms of governance, Wangaratta faces the same systemic risks - cost escalation, infrastructure renewal, climate and flood risk, and reliance on intergovernmental funding, rather than any unique council specific red flag.

Compared to other councils in the North East, including Wodonga, Alpine, Indigo, Benalla and Mansfield, Wangaratta is one of the stronger performers in its cohort, especially compared to Wodonga and Alpine which showed pronounced financial stress indicators.

It should be noted that since council submitted its report to the VAGO it has exited a contract (Wangaratta Co Store carpark) which carried a penalty of $5m, however, council reported that the early exit would save $4m in the long-term.

At the start of 2025-26 Wangaratta council forecast a surplus o $3.78m, however, the contract exit and other financial movements estimates a budget deficit of $5.69m by 30 June.

Shadow Minister for Local Government, Bev McArthur said councils are structurally dependent on state and federal funding to stay afloat.

She said only 10 of 79 councils can generate a surplus from their ordinary operations, and almost 20 per cent would have reported a loss last year if advance payments of federal assistance grants were recognised in the year to which they relate.