Fears Funding Shake-up Will Hurt ‘poorest Of Community’

Monday, 13 May 2024, 8:38 pm
Article: Alka Prasad - Local Democracy Reporter

A proposed funding shake-up for Auckland's local boards has sparked criticism it could drive inequality in communities that already suffer from historic underinvested.

However, Auckland Council says the proposed new model is actually fairer in the way it distributes funding to different communities and funding won't be taken away from local boards.

Auckland Council's proposed fairer funding model would change the weight of deprivation, population size and geographic location when deciding how much funding a local board gets.

Ōtara-Papatoetoe and Māngere-Ōtāhuhu local boards say they stand to lose funding under the proposed model.

“There's a lot of changes that I'm not sure our community is prepared for or aware of,” Ōtara-Papatoetoe local board chair Apulu Reece Autagavaia says.

Autagavaia says locals may have to say goodbye to more local services and assets “the community depend on” like libraries and community halls.

There are three options being mooted for funding changes, with lower, medium and higher rates associated with each scenario.

Autagavaia says community feedback was largely in support for the central or lower budget proposals, which will likely lead to cuts for South Auckland.

“It's not very fair for the poorest of our community,” he says.

Māngere-Ōtāhuhu local board chair Tauanu’u Nanai Nick Bakulich says the fairer funding model means Māngere-Ōtāhuhu "loses out".

The board stands to lose part of their budget in an area of “high deprivation”, he says.

“We’re battling on behalf of the community."

Deprivation is measured by assessing a community’s access to the internet, income, employment, education and qualifications, social support, living conditions and home ownership.

In 2020’s Auckland Prosperity Index, Ōtara-Papatoetoe and Māngere-Ōtāhuhu were deemed “low prosperity” areas, alongside Maungakiekie-Tāmaki, Manurewa and Papakura.

Autagavaia and Bakulich agree that adequate investment must go into the areas to improve South Auckland.

Under the proposed fairer funding model, local boards “with a disparity of funding" would need to manage within a reduced budget.

The three versions of the fairer funding model have been proposed, within the LTP, as: "pay less, get less", "central option", and "pay less, get less" options.

If Auckland Council adopts its "central proposal", some existing funding will be reallocated between local boards with some new funding ($20 million operating costs and $30 million capital expenses) over the first three years of the LTP 2024-2034.

“Under the ‘pay more, get more’ scenario no reallocation among local boards would be required. A funding uplift would get all local boards to their equitable funding levels," the proposal says.

But under "pay less, get less" scenario, no additional funding would be available.

"[Local boards] may not be able to deliver projects previously agreed, asset renewals or services without increasing fees, imposing local targeted rates or rationalising assets,” the proposal says.

Under the Council’s current operating expense projections, Māngere-Ōtahuhu will be over-funded by about 30 per cent in three years while Ōtara-Papatoetoe will be over-funded by about 10 per cent in that time.

Meanwhile, capital expenses for Māngere-Ōtahuhu are projected to drop by less than 10 per cent in three years while Ōtara-Papatoetoe is projected to be overfunded by about 10 per cent in the next three years.

That means Māngere-Ōtahuhu and Ōtara-Papatoetoe would have less funding allocated to be in an equitable position with other local boards.

But Auckland Council says it wants to be clear that no funding will be taken away from local boards.

Auckland Council chief of strategy Megan Tyler told Local Democracy Reporting in a statement that the fairer funding model is about addressing funding equity.

The proposed LTP addresses local board funding equity in the first three years, rather than the 10-15 years previously proposed in a 2021 decision, Tyler said.

“The new proposed model is fairer because it distributes available funding based on population (80 per cent), deprivation (15 per cent) and land area (5 per cent) versus the current allocation, which is based on assets in each local board area.”

She said under the current model, some local boards are funded “above the equitable funding level”, which would be corrected under the proposed funding model.

“Local board budgets for the first year of the LTP do not reflect the reallocation over time,” Tyler said.

Auckland Council proposes allocating $300m to support local boards in their transition to the new funding model, with $35m set aside to upgrade indoor sports facilities and another $5m to progress a waterfront swimming pool in the CBD.

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