Whanganui & Partners’ council move falls short of $900k savings target

Staff at Whanganui & Partners remain at the Innovation Quarter on St Hill St. Photo / Mike Tweed

Bringing Whanganui’s economic development agency in-house to the district council has not resulted in the savings hoped for.

In 2024, Whanganui & Partners (W&P), formerly a council-controlled organisation, became a department of Whanganui District Council rather than a separate company with its own board.

Annual savings of $900,000 were targeted but the council’s chief financial officer Mike Fermor said about half that had been achieved.

Speaking at an operations and performance committee meeting last month, Fermor said W&P staff had not been relocated as planned.

The agency is based in the Innovation Quarter on St Hill St.

“We believed we could house that team within the current council premises and we budgeted to reduce the lease cost through that,” he said.

“The reality is, we can’t at this stage.

“That has been factored into the upcoming annual plan [2025-26].”

Council chief strategy officer Sarah O’Hagan told the Chronicle the $900,000 target was set during development of the council’s long-term plan for 2024-34.

She said “a high-level budgeting approach” was used.

“This is where an overall savings target is identified first before detailed costs of delivering a service in-house are worked through.”

While there had been significant savings, a $900,000 reduction required a substantial decrease in the level of service provided, O’Hagan said.

She said the council provided $2.81 million to W&P in the 2023-24 financial year.

The Chronicle reported in August 2024 the budget had been cut to about $1.75m.

That meant programmes such as Amplify business grants and its Dragons’ Den-style competition were scrapped.

At the time, then-W&P economic development lead Jonathan Sykes said the organisation would focus on wider economic initiatives, rather than being “deep in the detail of every single business”.

Sykes has since left W&P and has been replaced by the agency’s former business strategic lead, Tim Easton.

O’Hagan said the revised funding forecast for W&P in 2025-26 was about $2.16m.

“We are confident the activity is operating as efficiently as possible without compromising service delivery,” she said.

“The council continually looks for opportunities to improve efficiency and effectiveness across all activities.

“However, it is important that funding remains sufficient to deliver the services our community expects and relies on.”

She said there were 17 full-time equivalent (FTE) roles when W&P was a CCO, across the iSite and regional tourism and economic development functions

“The current structure funds 10 FTE across those combined functions,” she said.

Mike Tweed is a multimedia journalist at the Whanganui Chronicle. Since starting in March 2020, he has dabbled in everything from sport to music. At present his focus is local government, primarily Whanganui District Council.