Editorial: City has done well to find $81m savings

Auckland Mayor Len Brown. Photo / Greg Bowker

Auckland's mayor has a right to blow his trumpet if he has managed to reduce the newly forged Super City's first rate increase from a likely 4.9 per cent to 3.7 per cent. The announcement on Friday was a sign that the council's bean counters are striving to find the efficiencies that are always promised when public bodies are amalgamated.

Their efforts are all the more welcome because the public has long since ceased to take the promise of savings seriously. Long observation of bureaucratic habits suggests that mergers create empires bigger than the sum of their parts, and more costly.

Local Government Minister Rodney Hide was as anxious as any architect of an amalgamation to see it produce efficiencies but the work done by his Auckland Transition Agency left a budget with a 3 per cent increase in the coming year based on savings the council would have to find.

But the agency set up the new council with too few staff, according to the deputy mayor, Penny Hulse. She told The Aucklander recently the council had 7800 staff of a planned 8500, compared to a total of 10,000 in the councils it replaced. A shortage of planning staff, for example, had forced the council to engage consultants at a cost of $8.75 million in its first five months.

The way it had been set up, the Super City was "not working for all our communities", Ms Hulse said. "There isn't that close connection between the politicians and the staff that has worked in the community so that decisions can be made quickly."

Ms Hulse was deputy mayor of the former Waitakere City Council, which paid its chief executive more than most others in the region and did not rank well on measures of benefit for the rates it charged.

Mayor Len Brown might not have appreciated her candour while he was attempting to squeeze his proposed budget for the new city so its required rate increase could be lowered from 4.9 per cent it proposed in February. On his other flank, he had a local MP, George Hawkins, issuing a public warning that his Manurewa constituents could not afford an increase of that size.

The council must somehow set a rate that Mr Hawkins' people can afford with no loss of the services of concern to Ms Hulse. On Friday the mayor claimed to have met that challenge. He said his revised budget would reduce the rate increase to 3.9 per cent "without compromising services to the community".

His officers have found $81 million of savings and efficiencies by deferring some capital works beyond 2012 that they probably did not have the capacity to do anyway. They have lowered their estimates for insurance, property costs, consultants, purchases and printing.

In addition, they have managed to make allowance for hosting extra Rugby World Cup matches moved from Christchurch, possible funding for an Auckland Theatre Company venue on the waterfront, other late commitments, and errors and omissions from earlier estimates.

They have done well to produce a possible rate increase below the current year's inflation rate, boosted by the October GST increase, and not too far above the underlying inflation rate. But in working so hard for this result, the council should not give the impression that it is afraid of asking citizens for a more significant rate increase when it has a project to warrant one.

The Super City was set up to enable Auckland to do things for itself that it could not manage to do when it had seven territorial councils and a weak regional body. The mayor and the council majority are facing an opposition that is waiting to pounce on profligacy. They need to run a tight ship but also be willing to go to the ratepayers for a project that is exciting.