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Home / New Zealand

John Banks takes axe to Auckland City's budget

Bernard Orsman
By Bernard Orsman
Auckland Reporter·NZ Herald·
11 Nov, 2008 03:00 PM4 mins to read

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John Banks realises the budget cuts will cause disappointment for some. Photo / Greg Bowker

John Banks realises the budget cuts will cause disappointment for some. Photo / Greg Bowker

KEY POINTS:

The Auckland City Council is looking to cut hundreds of millions in spending over the next 10 years on core services such as footpaths, public transport and stormwater to hold rates to inflation.

Even modest programmes such as water quality testing at Waiheke Island's swimming beaches from next
summer and installing training lights on sports fields will be hit.

Council officers have issued details of the first proposed spending cuts that form the basis of a new 10-year budget.

Auckland City Mayor John Banks and his Citizens and Ratepayers allies have to make deep cuts to the big-spending programme inherited from the previous council if they are to hold rates to the council rate of inflation.

The bloc's promise on rates has taken on an extra edge as the global financial crisis starts to affect the city's 165,000 ratepayers.

Last night, a sombre Mr Banks said the recession was going to push the city back five years, but he hoped people would be pleased he was in charge of the city's finances in recessionary times.

"I have a good grip on the money and I'm going to be careful. I know I am going to make mistakes and I know there is going to be quite a lot of disappointment about pet projects," he said.

One project sure to disappoint Aucklanders is an $86 million cut in stormwater spending that will almost certainly result in waste overflows continuing at St Heliers and other city beaches for years longer than planned.

During last year's election campaign, Mr Banks promised voters he would improve beaches and water quality and tore into former Mayor Dick Hubbard for pumping "human body waste" longer than necessary on to swimming beaches.

Among the biggest of the proposed cuts is a complete end to buying land and developing new parks for 10 years - saving $156 million - and deep cuts in the transport area.

The popular footpath renewal programme faces a $39.5 million cut to $218 million over 10 years, and cuts of $20.8 million are proposed for public transport plans.

Funding for new park-and-ride facilities could plummet by $5 million to $125,400.

New cycleways and walkways will be almost non-existent over the next decade if the proposed budget of $27 million is slashed to $4 million.

And efforts by the Avondale and Otahuhu communities for new swimming pools at a cost of $15 million each are unlikely to be successful for many more years.

Library upgrades, new public art, community centres and halls, and several town-centre upgrades are being cut or deferred for years.

For some of these projects, the deferrals are on top of deferrals implemented by Mr Banks and C&R in their first budget this year.

In total, officers have recommended reducing capital expenditure of $4.5 billion in the 2006-2016 budget to $3.7 billion in the 2009-2019 budget.

They have also recommended reducing the council's borrowing programme from a $1.7 billion peak under the old budget to $1.1 billion under the new budget.

Officers have come up with $238 million of efficiency savings over the next 10 years and $24 million of savings in the operating budget.

There is scant information on containing council bureaucracy, which grew from 1518 staff in 2001 to 1954 in 2007. The wages bill rose 70 per cent over the same period, and consultant costs soared from $42.6 million three years ago to $62.2 million this year.

Finance committee chairman Doug Armstrong said the council would try to make bureaucracy cuts commensurate with cuts in capital spending.

City Vision councillor Glenda Fryer said the opposition bloc was overwhelmed by the "big knife" cuts, particularly to community services and environmental projects.

She said projects such as improving water quality for swimming beaches and building walkways were being sacrificed for a big spend-up on Eden Park and an events package for the 2011 Rugby World Cup.

The council is budgeting $28.8 million for the Cup, planning what C&R councillor John Lister called "the biggest party Auckland has ever seen".

It is spending another $18 million on upgrading roads and infrastructure around Eden Park.

The council has salted away most of the funding for the party and could ask ratepayers to each chip in $23 in three years to meet a $6.9 million shortfall.

* The figures

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Opinion

Do the proposed cuts to Auckland City services go too far?

11 Nov 07:56 PM
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