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Council Struggles to Balance 10-year Budget

Manukau City Councillor For Howick
Media Release
5 April 2006
Council Struggles to Balance 10-year Budget

Last night the Manukau City Council held an extraordinary meeting to consider budget short falls in its draft Long Term Council Community Plan. These budget short falls were recently highlighted during an Audit conducted by Audit NZ during the last week.

Howick Councillor Jami-Lee Ross was present at that meeting and says the city is facing a major issue that requires Council to seriously review much of the wasteful expenditure that is weighing the city down.

“What the opinion from Audit NZ tells us is that Manukau City Council has been living outside its means for a long time. We are now facing a budget short fall in the long term Plan that will adversely affect the city for the next ten years” Mr Ross says.

“A balanced budget, in simple terms, means that Council’s operating expenditure should not exceed a level that can not adequately be covered by sustainable levels of revenue. The Audit NZ review has discovered that Manukau City Council’s initial draft LTCCP shows that Council expenditure is too high to fulfil the requirements of a balanced budget.

“Our officials have suggested that the best way for Council to tackle this issue is to hike up rates up by almost 9 percent this year and 7 percent next year to fund the shortfall. However, this is not an acceptable level of rating.” Mr Ross says that Councillors need to make some long overdue decisions that will place the city in a better financial position for the future. “Council’s responsibility is to deliver a balanced budget, as well as provide ratepayers certainty that their rates will be capped at no more than the rate of inflation. That means that its time for Manukau City Council to tighten its belt and lose all that excess baggage.

“The first area we need to look at is the completely unsustainable policy of free entry to swimming pools.

This policy puts the Council behind the times with every other city in New Zealand and costs Manukau ratepayers over $4.5 million annually. A nominal charge of $2 for adults is not too much to ask when most other pools in Auckland charge at least double that amount.

“Council also needs to give consideration to the way in which it funds growth in the city. The new draft LTCCP sees the growth centre budget jump by over 90% for the years between 2006 and 2008. Last year funding of this area was estimated at $7.3 million, but that has now skyrocketed to over $14 million. Is this expenditure justified given that most predictions show growth slowing down in the near future?”

Mr Ross also believes the impacts of past decisions are beginning to take their toll on the city. “Several years ago Council gifted in excess of $30 million to the Pacific Events Centre project. While that centre is now complete, what most people won’t realise is that ratepayers continue to finance that Trust by $385,000 annually. Those funds are in addition to the $13.5 million that will be given away in general grants over the next ten years.

“The over-taxed Manukau City ratepayers also began carrying the burden of the new Council propaganda machine from 1 March in a scheme that has already gone over budget before the first paper has even been produced.

“Likewise, Council continues to fund a Treaty of Waitangi unit at $400,000 each year in an area that local authorities arguably should have nothing to do with. Marae development and Pacific advisory services are also putting strain on the budget, each costing around $1 million during the period of the long term plan” Mr Ross says there are many Council programs in the LTCCP that are putting pressure on scarce resources and contributing towards an unsustainable funding situation. “As a city, Manukau is in a serious situation where the Council needs to make some significant changes. The time of high rate increases and an unbalanced budget have to end. Councillors must take the audit advice on board and reassess city priorities for the long term future.”


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