Auckland Council's finances better than expected after Covid

Auckland Council is in good shape following Covid. Photo / File

Auckland Council has reported record spending of $2.5 billion on infrastructure in an "emergency budget" brought about by Covid-19 and partly paid for with a 3.5 per cent rates rise last year.

Helped along with subsidies from Waka Kotahi NZ Transport Agency, the Government and $149 million from the regional fuel tax, the capital investment programme included progress on the City Rail Link and the new Puhinui train and bus interchange.

The council also opened $350m of new city centre waterfront public spaces that included a new seawall, upgraded town centres in Takapuna and Flatbush and poured $885m into water networks, including $195m on projects to boost the water supply following the drought.

Last year, Covid-19 blew a $1b hole in the council's budgets out to 2024, but this has been reduced to $750m.

Auckland Mayor Phil Goff. Photo / File

Mayor Phil Goff said that the council's strong financial position prior to the latest Covid-19 outbreak will be a crucial factor in helping it absorb the revenue losses incurred due to the current level 4 and 3 lockdowns.

"In the Recovery Budget we passed this year we budgeted prudently in the knowledge that a further community outbreak of Covid-19 was a real risk. We left room in the budget to cope with further revenue loss, so that even if this occurred we could sustain record infrastructure investment and maintain council services.

"Unless the current lockdown is prolonged we will be able to manage operating revenue losses of a forecast $80 to $160m, without breaching borrowing limits, further cuts to council spending or rate increases beyond what is set out in our 10-year Budget.

"However, in the current uncertain environment, we will need to continue a prudent and agile response to get through the challenges that confront us," Goff said.

The council also managed to deliver more than the $120m of savings sets out in the emergency budget, with further savings of $90m.

And following years of rising salary costs, the bill for the wider council group fell from $997m last year to $963m.

Finance and Performance Committee chair Desley Simpson said: "This was a challenging year for Auckland, and a challenging year for Auckland Council, but our focus on cost containment and improving operating efficiencies put us in a strong position to navigate our recovery phase."