The unelected Maori Statutory Board will cost Auckland ratepayers $3.4 million a year to run after its budget was rushed through under urgency yesterday.

Councillors were given virtually no time to consider the budget, which has blown out from a $400,000 estimate - by the agency that set up the Super City - to a multi-million-dollar cost.

Mayor Len Brown will have to slash $3 million from existing spending in his first budget or raise rates to pay for the unbudgeted cost.

The funding agreement approves $2,066,000 for the remaining eight months of this year's budget and $3,435,500 for 2011-2012.

Auckland Council's finance committee approved the budget yesterday under urgency, and it was not presented to the full council.

The nine-member Maori Statutory Board became controversial when it was revealed its members would sit on and appoint other unelected Maori members to at least 11 of the council's 18 standing committees.

The board was established in law as part of the Super City reforms after recommendations for three Maori seats on the council were rejected by Government and Local Government Minister Rodney Hide.

By comparison, Mr Brown has a mayoral office budget of $4.1 million with a staff of 18.

Yesterday, board chairman David Taipari and Mr Brown issued a press statement through the board's public relations firm, Exceltium Ltd, which only made a passing reference to the $3.4 million funding agreement.

Later the two leaders defended the cost. Mr Taipari said the budget was the result of independent external advice examining the board's work plan, a range of projects, advisers and a secretariat to maintain independence.

"We have been very careful to try and keep that figure as low as possible knowing full well the implications of the money and how that might be perceived in the public," Mr Taipari said.

Through a spokesman, Mr Brown said the budget covered the council's statutory obligations.

The Auckland Council also operates a Maori strategy and relations department with 19 staff. Protocols of how the department and Maori Statutory Board will work together were still being worked through, said a council spokesman.

In the press statement, Mr Taipari and Mr Brown said the board would make initial appointments to 11 of the council's 18 committees and continue discussions on appointments to other committees.

Said Mr Taipari: "At this initial stage, members of the board will sit on the council committees, but we will also look to bring in new talent from the Maori community."

He repeated the board's earlier commitment to acting responsibly in the exercise of its powers.

Orakei councillor Cameron Brewer said the council needed to push back on the "gold-plated" budget for the nine-member board.

"Those leading the discussions have let the ratepayers down by simply not negotiating forcefully enough with the board's initial demands. The board has effectively sent the council a made-up invoice and the mayor's just said 'pay it'," he said.

Citizens & Ratepayers co-leader Christine Fletcher said the full council should have been involved in approving the budget.

Auckland Council chief executive Doug McKay said that by law the Maori Statutory Board was an independent body that did not report to the Auckland Council, but an electoral college formed by Te Puni Kokiri, which set it up.

Mr McKay said each year the board would negotiate a funding agreement with the council, saying he was responsible for monitoring its funding, employment contracts and the functioning of the board, such as office support. He said he was not responsible for who was on the board or its policy positions - "in that sense they are very strongly independent".

* Pay and expenses for nine board members: $494,500
* Pay and expenses for non-board members sitting on council committees: $50,500
* Staff costs: $946,500
* Legal, communication, professional advice, tikanga: $470,000
* Engaging and reporting to Maori community: $280,000
* Audit of council performance relative to Treaty of Waitangi: $175,000
* Research on wellbeing of Maori: $650,000
* Council support services: $369,000
* Total: $3,435,500