Editorial: Financial review means council can move on

Kim Gillespie

Rumblings of dissatisfaction with the Rotorua District Council in previous years have been borne out in part by an independent report released yesterday.

In February mayor Steve Chadwick called for the independent review of financial reporting processes after it became clear the council's finances were in worse shape than previously thought.

She said: "I want to find out once and for all whether appropriate financial information has been disclosed in recent years, so we can put this question to rest and move on".

The report, by PwC, finds no evidence of intentional mishandling of council finances and says the council's new financial strategy is on the right track.

But it also highlights serious financial concerns, saying significant "unfavourable anomalies" were discovered in revenue and expenditure, that airport debt funding was unsustainable, that the council had lacked senior financial experience and that its financial reporting was too detailed.

Plenty of ammo for the council's critics, but it should be noted that of the report's 16 recommendations, six have already been adopted. The rest provide a clear path ahead for the current council.

Key among them is the recommendation the council build on its proposed structural changes "to improve financial awareness and capability in the wider management group while continuing to enhance financial information that meets business needs".

What's frightening is that the systems that were in place allowed for things to get so bad.

Never again do we want to find that our council staff lack financial experience, that debt issues go unquestioned or that councillors do not have access to clear, concise financial reporting.

At the time the review was announced, some complained about the potential cost - which in the end was $45,000 - but it was clearly the right move. We all need to know exactly how bad things were and are, so Rotorua and its council can move ahead in a climate of confidence and transparency.