The War on Council Waste: A Battlefield Guide

N O R A W THE

L I C N U CO

: E T S WA

D

L E I F E L T T A BA

E D I U G

AUCKLAND RATEPAYERS’ ALLIANCE JULY 2018

1

Championing Reasonable Rates, Sensible Spending in our Super City. www.ratepayers.nz (09) 281 5172 enquiries@ratepayers.nz facebook.com/ratepayersalliance @AkldRatepayers Bank Account: 03-0502-0288497-000 PO Box 133099, Eastridge, Auckland 1146 © Auckland Ratepayers Alliance 2018 1

THE WAR ON WASTE: A BATTLEFIELD GUIDE FOR RATEPAYERS

Dear Supporter, This pocket-sized factbook is your guide to how Auckland Council is spending your money.

The average Auckland household now pays $1,300 more in Council expenses compared to when the Super City was founded. The wasteful spending and broken promises highlighted in these pages helps to explain why.

We encourage you to share this booklet with friends and family, and ask them to join the Ratepayers’ Alliance. Our fight to champion reasonable rates and sensible spending becomes stronger with every new member.

Thank you for your support,

Jo Holmes Spokesperson AUCKLAND RATEPAYERS’ ALLIANCE JULY 2018

2

Total Council revenue $4.5billion

$4billion

$3.5billion

$3billion

$2.5billion

/2 01 7 16

20

/2 01 6

5

20

15

01

20 14 /2

/2 01 4 13 20

/2 01 3 12 20

20

11

/2

01

2

$2billion

Total Auckland Council Group Income

3

THE WAR ON WASTE: A BATTLEFIELD GUIDE FOR RATEPAYERS

Total Council revenue has climbed from $2.8 billion in 2011/12 to more than $4.1 billion in 2016/17 – a 46% increase in just five years.

While commentary on Council spending and waste has traditionally focused on general rates, Len Brown and Phil Goff have increasingly relied on new targeted rates and taxes to fund the Council’s dramatic growth.

While Phil Goff claims he is holding general rates increases to 2.5%, because of new rates and levies the actual increase in financial burden to households is much higher.

AUCKLAND RATEPAYERS’ ALLIANCE JULY 2018

4

The rates burden $3,000

$2,900

$2,800

$2,700

20 12 /2 01 3 20 13 /2 01 4 20 14 /2 01 5 20 15 /2 01 6 20 16 /2 01 7

20 11 /2 01 2

$2,600

Average rates per household

5

THE WAR ON WASTE: A BATTLEFIELD GUIDE FOR RATEPAYERS

Fighting excessive hikes in rates remains the most effective way to control the financial burden the Council imposes on households.

Phil Goff says that rates have fallen as a proportion of Council income, from 49% to 40%. However, as shown, this doesn’t mean rates are decreasing in real terms. It simply means that other charges, levies, and fees are growing even faster.

AUCKLAND RATEPAYERS’ ALLIANCE JULY 2018

6

Operating expenses vs capital expenditure $3,000

$2,000

$1,000

7 20

16

/2

01

6 15

/2

01

5 20

20

14

/2

01

4 01 /2 13 20

20

12

/2

01

3

$0

Auckland Council Group expenditure Operating

7

Capital

THE WAR ON WASTE: A BATTLEFIELD GUIDE FOR RATEPAYERS

The politicians claim we need rates hikes and new levies and taxes to fund infrastructure investment. But most of the new money is going to increased day-today operational costs (including paying interest on debt) rather than capital projects like water, sewerage, and roading.

AUCKLAND RATEPAYERS’ ALLIANCE JULY 2018

8

Projected

$12.0billion

Projected

The Council’s borrowing

$10.0billion

$8.0billion

8 01

18 20

/2 17

20

/2 01 9

7 01

6

/2

20

16

01

5

/2

20

15

01

4

/2

20

14

01

3

/2

01

13 20

/2 12

20

20

11

/2

01

2

$6.0billion

Auckland Council Group total liabilities

9

THE WAR ON WASTE: A BATTLEFIELD GUIDE FOR RATEPAYERS

The Council’s per household liabilities are $20,900. That’s $8,300 per person and it’s getting worse.

“Here is his birth certificate and a bill from the Council for $8,300.”

AUCKLAND RATEPAYERS’ ALLIANCE JULY 2018

10

Interest on debt per household $900

$800

$700

$600

$500

17

20

16

/2 0

16 5/ 20

15 20 1

4/ 20

14 20 1

13

3/ 20 20 1

2/ 20 20 1

20 1

1/ 20

12

$400

Average financing costs per household

11

THE WAR ON WASTE: A BATTLEFIELD GUIDE FOR RATEPAYERS

As Auckland Council accumulates debt, it doesn’t just impose a cost on future generations to repay it, the Council must also pay the interest.

Financing costs are now $471 million per year – equivalent to 11% of all Council income.

If interest rates increase from their current historic lows, these costs will skyrocket.

AUCKLAND RATEPAYERS’ ALLIANCE JULY 2018

12

Total Council expenses per household

$6,850 in 2018

$5,450 in 2012

13

Since the Super City was founded, Auckland Council has grown its average household expenses from $5,450 in 2011/12 to $6,850 today.

THE WAR ON WASTE: A BATTLEFIELD GUIDE FOR RATEPAYERS

Judge for yourself:

Communications staff spending -

$45 million on spin doctors or $81.50 for every Auckland household.

A report leaked in October 2017 revealed that communications staff spending at Auckland Council had grown by 75% between 2013 and 2017.

AUCKLAND RATEPAYERS’ ALLIANCE JULY 2018

14

Judge for yourself:

In 2015 Devonport Library installed a silk curtain costing ratepayers

$100,000.

15

THE WAR ON WASTE: A BATTLEFIELD GUIDE FOR RATEPAYERS

Judge for yourself:

Last year Auckland Transport spent

$11 million on its office fit-out – including

$126,000

on tap fittings.

AUCKLAND RATEPAYERS’ ALLIANCE JULY 2018

16

Judge for yourself:

Auckland Council spent

$1,100,000

on international flights between January 2016 and August 2017.

Destinations included Portugal, Israel, Colombia and Switzerland.

17

THE WAR ON WASTE: A BATTLEFIELD GUIDE FOR RATEPAYERS

Judge for yourself:

Last year Auckland Council gave away 60 Adele concert tickets to staff, businesspeople, and journalists worth

$18,900.

AUCKLAND RATEPAYERS’ ALLIANCE JULY 2018

18

The corporate welfare arm of Auckland Council – ATEED – received

$47.8 million this year.

19

THE WAR ON WASTE: A BATTLEFIELD GUIDE FOR RATEPAYERS

How well does ATEED spend its budget?

In March, ATEED hosted 76 ‘stakeholders’ at the ASB Classic tennis event – including one ‘stakeholder’ who owns a superyacht, and three ‘stakeholders’ from the Council subsidised media website, The Spinoff.

In February, it was revealed that ATEED plans to spend $3.2 million on a new office fit-out.

In 2016, ATEED spent $500,000 to develop a new slogan/brand for Auckland: ‘the place desired by many’. We say, if Phil Goff wants to find efficiency savings, he could cut the ATEED budget until it’s clear it can deliver value for money.

AUCKLAND RATEPAYERS’ ALLIANCE JULY 2018

20

Phil Goff’s broken promises: “Rate rises will be kept low and affordable at an average of 2.5 per cent per annum or less.” “… each department within Council will be set an efficiency target, averaging 3 to 6% across total Council expenditure…”

“Areas where staffing and expenditure are very high or have increased disproportionately … will be expected to find higher levels of savings.”

21

THE WAR ON WASTE: A BATTLEFIELD GUIDE FOR RATEPAYERS

Despite low inflation, rates and levies are still ballooning under Phil Goff’s watch.

While general rates are set to increase by 2.5% this year, the Mayor is deceptively loading on additional targeted rates and the Regional Fuel Tax. Households with a car will face an equivalent rate hike of over 6.2% this year. Larger families and those in outer suburbs will be even worse off.

The fuel tax would not be required if Phil Goff had kept his promise to find efficiencies across the Council.*

*Expected fuel tax revenue is equivalent to 3.9% of Council revenue. To date Mr. Goff has identified only 0.3% of efficiencies.

AUCKLAND RATEPAYERS’ ALLIANCE JULY 2018

22

WWW.RATEPAYERS.NZ 23

THE WAR ON WASTE: A BATTLEFIELD GUIDE FOR RATEPAYERS