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Local Authority Expenditure Rises

19 June 2006

Local Authority Expenditure Rises

Local authorities' seasonally adjusted expenditure rose 3.6 percent in the March 2006 quarter, Statistics New Zealand said today. Total expenditure for the March 2006 quarter was $1,329.6 million, up $46.5 million compared with the December 2005 quarter.

Purchases of goods and services, grants and donations showed the largest expenditure increase, up $25.6 million (3.7 percent) from the December 2005 quarter, to reach $ 724.7 million.

Employee costs (up $8.9 million), interest paid (up $8.2 million) and depreciation (up $3.8 million) also increased. Total operating revenue for the March 2006 quarter was $1,336.8 million, a marginal decline of 0.1 percent ($1.5 million) compared with the December 2005 quarter. The decrease was mainly due to a $20.5 million fall in investment income. Government grants and subsidies declined by $10.2 million. This was partly offset by increases of $18.9 million in rates, and $10.3 million in sales of goods and services and all other income.

Overall, local authorities produced a combined operating surplus of $7.2 million in the March 2006 quarter. The operating surplus for the December 2005 quarter was $55.2 million. Results from the Local Authority Census are now available for the year ended June 2005. Local authorities recorded an annual operating revenue of $4,996.1 million (up 8 percent) and an annual operating expenditure of $4,746.7 million (up 8.6 percent), resulting in an annual surplus of $249.4 million.

Contributing to the increase in revenue were general rates (up $152.1 million), grants, subsidies and levies (up $105.7 million), sales and other income (up $73.1 million), fees and fines (up $25.8 million), investment income (up $ 5 million), water rates (up $6.9 million) and petrol tax (up $1.4 million).

Increases in purchases and other expenditure (up $224.5 million), employee costs (up $68.5 million), depreciation (up $67.7 million) and interest paid (up $15.9 million) contributed to the increase in expenditure.

Geoff Bascand

Acting Government Statistician


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