Speak up on plans for your area’s future

East Auckland residents are being urged to make submissions on Auckland Council’s proposed Annual Budget between 28 February and 28 March.

Howick Local Board Chair

Damian Light says it’s also important people provide their feedback on the Local Board Plan when it opens for submissions later in the year.

“We know a rates increase is proposed, but local board budgets are going to be significantly reduced, and that will see an inevitable reduction in what can be achieved in our area.

“Due to contractual commitments and timing, only a small portion of our operating budget is available to be considered for savings so the majority of the $1.1 million reduction will come from our Locally Driven Initiatives. This represents a 44 per cent reduction to our funding for grants, events and local programmes. The reality is that this means we won’t be able to deliver or support everything we have in the past, so we need the community to help us priortise what’s important to them.

“People often call for lower rates, and certainly for targeted spending and reducing it in what they see as wasteful areas, but few people ever agree exactly what those areas are.

“That makes it imperative the board gains a good understanding of what people see as local priorities, where they want the money spent, and which services they want maintained.”

He says it is a simple equation, lowered budgets mean services must be cut.

“Some people might favour spending on environmental issues, others on funding for the arts and community groups and events, while others would give those areas a low priority.

“The only way we can know is if people engage in the process and make submissions,” Chair Light says.

Council’s Governing Body confirmed its Annual Budget consultation items late last year, including consulting on significant reductions in council group spending, increasing general rates, using debt and the sale of Auckland Airport shares to counter some extraordinary economic conditions.

Since then, the city has been struck by the adverse weather that caused not only widespread damage across Auckland, but fatalities, and only a fortnight later by Cyclone Gabrielle.

“These events, coming off the back of the Covid crisis and the Emergency Budget in its wake, will only add to the difficulties we face,” Chair Light says.

“We have some tough decisions and significant challenges in the next few years.

Auckland Council is facing the consequences of inflation and interest rate rises, which are impacting operating costs and financial forecasts. Those and other challenges have caused an estimated operating budget gap of $295 million.

“Any option you use to close a budget gap has short and longterm implications,” Chair Light says.

Mayor Brown is proposing an additional $60m in operational savings on top of $30 million required to meet the current Long- term Plan target of $90m a year.

Achieving those targets requires reducing back-office support costs, simplified management structures, stopping or providing some services differently, and a significant local board funding reduction.

Also proposed are more shared services to eliminate duplication across council and its organisations, alongside further cost savings for each Council Controlled Organisation receiving ratepayer funding

Those moves call for Auckland Transport to make $25m of operational cost and revenue changes without further cuts to public transport services, the same savings from Tātaki Auckland Unlimited with a further $2.5m by reducing some economic development activity, and for $5m in savings from Eke Panuku – to be achieved by delaying capital investment and reducing the costs of urban regeneration.

The rates changes outlined would result in an increase for the average household of 4.66 per cent – or $153 a year, around $3 a week. This includes a 7 per cent rate increase that’s offset by reductions to the environment and water quality targeted rates.

That means the 4.66 per cent is close to what would have occurred under the previously planned 3.5 per cent increase, without the targeted rate offsets.

Chair Light says the Annual Budget proposal also includes a change to the Auckland Airport share policy. A full sale of the council’s 18 per cent shareholding would raise about $1.9b that would be used to pay down debt.

“Obviously that would mean a reduction in interest costs. But other options will also be considered, such as retaining the shares or selling a smaller parcel to keep a 10 per cent stake.”

To improve its returns to the council as its owner, Ports of Auckland has also been urged to increase its profitability by at least $10m more than previously forecast, while increased debt of up to $75m could be implemented if needed. The council uses debt to fund capital investment.

The latest consultation information is posted on the council’s akhaveyoursay.nz website.

After public feedback and any new financial information, an updated proposal is prepared, with the Governing Body to adopt the final Annual Budget by 30 June.