CENTRAL Highlands council deputy mayor Paul Bell says a $32 million council deficit is not a reflection of financial mismanagement within the organisation.
The CHRC's latest monthly financial report was tabled at last week's council meeting and uncovered the reality that the council was more than $32 million in the red.
Cr Bell said while unusual, it could be completely explained.
"These are extraordinary numbers on the back of an extraordinary flood event."
Cr Paul Bell
"They can be completely attributed to the fact that council has National Disaster Relief and Recovery Arrangements flood money claims awaiting approval," Cr Bell said.
"The money was spent on flooded roads throughout the region which we did as a matter of urgency.
"We are 100% confident that we will recoup all the money."
Cr Bell said there was about $80 million worth of road damage across the region, and the council had moved quickly to fix as many as possible for the sake of residents and businesses.
So far, about 20% of the council's NDRRA flood grant money has been received.
"There is about $6 billion that the state needs to work through," Cr Bell said.
"There is a huge reconstruction program, not just here but all over the state.
"Despite that, we are fully confident that all the money we have spent will be returned, which should put us back in line with budget predictions.
"We have actually had a fairly sound year in terms of the budget."
Despite the deficit, Cr Bell said cash flow would not be a problem for the council, which has counteracted any negative effects with extended loan funds.
At last Monday's meeting, the council called for a full report looking into the news that 6% of the total rates money owed to it remained unpaid.
Cr Bell said the missing 6% should not be seen as having a major effect on the $32 million deficit, but it was still a high figure.
"We are very concerned that some people are not paying their rates," Cr Bell said.
"It is a high number and that is not healthy.
"We have ordered a full report into the situation and we hope to uncover which groups are not paying and why.
"After June 30, any rates that are not paid become a definite outstanding debt."
Mr Bell said the timing of the NDRRA payments was no different to any other region.
"What we are doing now is making sure we have no blockages or hold-ups from our end in relation to the funding applications," he said.