Bernard Orsman

Bernard Orsman is Super City reporter for the NZ Herald.

Mayor turns up heat on agencies' costs

CCOs seem reluctant to make cuts, Brown's report says

Cloud rental will help Waterfront Auckland's budget. Photo / Natalie Slade
Cloud rental will help Waterfront Auckland's budget. Photo / Natalie Slade

The council bodies that soak up a lot of ratepayers' money are not impressing their political masters when it comes to reducing rates next year.

More rental income from the Cloud and an end to mowing berms are among the responses from the council-controlled organisations to trim their operational budgets.

But while Mayor Len Brown has been pleased to reduce a projected rates increase from 5.3 per cent to 2.9 per cent, he says calls for savings from council departments and CCOs has been mixed.

"While there have been some positive ideas, overall the feedback has shown a reluctance to reduce costs in most areas with a few notable exceptions," he said in a report on next year's budget.

Councillor Cameron Brewer has gone further by saying the CCOs have got off far too lightly with just $10.4 million of cuts from their collective budgets.

"There's a lot of fat in the CCOs which soak up a lot of council's annual $3 billion operational budget," he said.

Mr Brewer highlighted Waterfront Auckland, which has an operational budget of about $27 million, for finding no savings and just proposing $347,000 extra rental income from the Cloud.

He has also questioned the need for Ateed to have 60 staff employed in economic development.

Ateed chief executive Brett O'Riley said a review of the economic development unit, which included eight staff funded by central government, was currently underway. It was too early to say if it would lead to job losses as some jobs were being disestablished and new jobs created, he said.

Waterfront Auckland chief executive John Dalzell rejected Mr Brewer's criticism: "We were asked to do our bit and we have done our bit."

He said the extra revenue from the Cloud represented more than 4 per cent of Waterfront Auckland's operating spending, it had absorbed $188,000 of extra insurance costs and was likely to save further money by reducing maintenance for some public assets.

The largest CCO, Auckland Transport, put forward about $20 million of savings from an operational budget of $792 million, but Mr Brown's office and a small group of councillors only accepted $4.096 million.

CCOs with big capital projects - such as Auckland Transport and Waterfront Auckland - will come in for more attention when Mr Brown reviews the the council's $1.8 billion capital programme next year.

A Herald report last month found that it cost $13.3 million in board and executive costs to run the CCOs.

CCO budget cuts/extra income

Auckland Transport: $4.096m
*Discontinue berm mowing
*Reduce fund for emergency bus services

Regional Facilities Auckland: $1.126m
*Staff rationalisation
*Reduced funding for regional facilities
Selling land adjacent to TelstraClear Events Centre

Waterfront Auckland: $347,000
*Increased rental income from the Cloud.

Auckland Council Investments: $3.48m
*Dividend policy from 90 per cent payments to 100 per cent

Auckland Council Property: $200,000
*Reduce consultancy and other costs

Auckland Tourism, Events and Economic Development: $1.175m
*Close five visitor centres
*Corporate savings

- NZ Herald

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