1200 job cuts to save city $66.5m

Mark Ford. Photo / Sarah Ivey

The Super City will open for business on November 1 with 1223 fewer staff than the existing councils and their business units, leading to a $66.5 million cut in the annual wage bill.

The agency designing the Super City has trimmed staff numbers from 9430 staff a year ago to 8207.

Cuts in wages and conditions among non-unionised staff have also been reported.

The heaviest casualties are among middle managers, but the chief executives of the eight councils have also been sent packing, replaced by Doug McKay, who has moved into the top job at the Auckland Council from the private sector.

The Auckland Transition Agency says about 650 of the 1223 staff who will be lost in the changeover will be made redundant at a cost of about $15 million to $20 million, but has not said how much ratepayers will pay in golden handshakes to chief executives.

Rumours of huge payouts of up to $1 million are rife, and one chief executive of a business unit is believed to be in line for a $600,000 payout.

The November 2009 staff figure of 9430 covers permanent and part-time personnel, vacant positions and private contractors hired by the eight councils and more than 40 council-controlled organisations.

The 8207 figure for the Super City covers the same group of employees.

The agency said staff numbers would drop by another 300 when people employed to bed down the Super City completed their work by July 2012.

This would lead to a $91 million overall reduction in the wages bill to $513 million by mid-2012.

Transition agency executive chairman Mark Ford said existing council staff would have far greater certainty about their jobs in the next few days once termination letters were issued.

The number of redundancies was fewer than the total number of job losses, largely because the councils had not been replacing staff when they left and had been using fixed-term contractors, he said.

The chances of cost savings from fewer staff leading to lower rates appear remote.

None of the main Super City mayoral candidates or political tickets are promising lower rates from the savings and efficiencies expected from the reforms.

As well, setting up the Super City has cost $200 million, which will be borne by ratepayers.