Motorists’ parking fees save Melbourne City Council budget amid overspend
Melbourne motorists have unintentionally rescued the City of Melbourne’s budget, with a $5.1 million windfall in parking meter fees covering a multimillion-dollar overspend on consultants and software.
According to the latest Quarterly Performance Report, to be presented at a council meeting on Wednesday night, the City recorded a $4.1 million underlying surplus for the first half of the financial year. This unexpected boost, however, relied heavily on revenue from parking meters.
Town Hall collected $33 million in parking fees over six months — $5.1 million more than anticipated — due to higher usage and expanded parking zones, not increased fines or fee rates. The report noted that while meter revenue soared, parking fines brought in $800,000 less than predicted, attributed to higher compliance among drivers.
Despite the positive parking revenue, a $3.8 million overspend on contracts for materials, services, and software offset some of the gains. The council attributes this overspend to timing differences, as expenditures occurred earlier than planned, and expects the budget to balance by year-end.
A City of Melbourne spokesperson said the parking fee surge reflects the city’s economic recovery. “Higher turnover means more people can find a park when they need one, and more access drives business to our shops, restaurants, and events,” they said.
The report shows that Melbourne’s current debt stands at $110 million, under a $212 million cap. Meanwhile, the Allan government’s controversial congestion charge, introduced on January 1, 2026, is expected to further increase off-street parking costs in the CBD, though this is not reflected in the current report.
Ratepayer advocate Dean Hurlston warned that council finances remain tight. “They appear to be using parking revenue to prop up the organisation. Parking and fines should be lowered to encourage visitation,” he said.
Despite these pressures, the council continues to maintain several income streams to support its budget, with parking meter revenue being one of the most significant indicators of the city’s recovering economic activity.
