Council’s cash investments unprotected

BY EMMA KEMP
More than half of the City of Sydney’s cash investments are not protected by government guarantees, the latest council finance report shows.
The Register of Investments and Cash report presented at a council committee meeting last Monday, shows that only 36 per cent of council’s cash investments are totally secure.
‘So 64 per cent of council’s cash reserves are invested in investments and they’re not under the government guarantee,’ Greens councillor Chris Harris said. ‘Shouldn’t we be thinking about how we can do that’ That would be a prudent thing for us to do.’

‘If for some reason any of the things that we have default, then we have a problem,’ he said.

Cr Harris said a report will be presented at the next council meeting detailing the implications associated with moving money into those guaranteed deposits.

He also said Sydney’s highly coveted AAA credit rating ‘ which allegedly indicates a credit risk of almost zero ‘ is meaningless.
In early October NSW Premier Nathan Rees announced he will do ‘whatever it takes’ to maintain the state’s AAA credit rating.
‘I think this absurd obsession with this AAA rating business, which predicates that we’re not going to have any debt is ridiculous,’ Cr Harris said.
‘The interesting thing is, they keep talking about this AAA (rating). These ratings are fictitious because all these subprime mortgages were AAA rated too. The people that come up with the ratings are compromised, and I think the public should ignore that stuff.’