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Auckland councillors have approved Mayor Wayne Brown’s draft 10-year budget for public consultation after a long and sometimes fiery meeting today.
Brown has framed the budget as the time for Auckland Council to “grow up” and do a few things really well, rather than lots of things poorly.
After some councillors expressed concerns with parts of the budget, Brown said the council should not be limiting what the public might have to say, and warned if things get taken out rates will go up further.
Deputy Mayor Desley Simpson said: “We all love Auckland. I’m going to support all the recommendations and listen to what the people of Auckland have to say.”
The vote to put the budget out for public consultation was made by the budget committee, which includes two members of the Independent Maori Statutory Board.
Brown said under his proposal residential rates rises will be 7.5 per cent in year one, 3.5 per cent in year two, 8 per cent in year three due to a one-off hit from the City Rail Link, and rates near inflation thereafter.
The running costs of the City Rail Link are estimated at $220 million a year.
A 7.5 per cent rates rise will take this year’s rates bill from $3560 to $3827 for the average household. On top of this, Watercare has flagged water bills rising by 30 per cent, from $1340 to $1742 on average.
This would lead to the average household paying $5569 for rates and water, or $107 a week.
The proposed budget has three options for public consultation - a base proposal, a higher “pay more, get more” and a lower “pay less, get less” with the option for people to provide feedback on a combination or mix of options.
The “pay more, get more” would lead to rates increases of up to 14 per cent in year one, 10 per cent in years two and three, then 5 per cent thereafter; and the “pay less get less” to about 5.5 per cent in year one, 3.5 per cent in years two and three, and no more than 1 per cent above inflation thereafter.
The proposed budget reduces the running costs of all parts of the council, except for Auckland Transport and Watercare.
The budget contains cuts to cycleways. Photo / RNZ / Tom Kitchin
Auckland Transport’s $16b capital programme for the LTP has been reduced to $14b in the mayoral proposal, including cuts to “low-value initiatives that cost too much” like $80m on raised road tables and reducing the cycleway budget by $141.5m to $430m.
One of the biggest items in the budget is $5.5 billion over 10 years to fund road renewals - nearly 40 per cent of the total transport budget - subject to matching funding from central government.
At a workshop with councillors in October, AT was of the strong view to no longer compromise or underfund renewals, saying it is a false economy, and creates unacceptable health and safety risks.
AT said in past years funding levels have been below recommended levels and continued deferral would lead to further “sweating” of roads, including below-road damage and higher repair costs.
A key part of Brown’s proposed budget is selling a long-term lease for Port of Auckland’s operating business while keeping the waterfront land in public ownership, which was narrowly passed to go out for public consultation by 12 votes to 11.
He wants to put the proceeds into an “Auckland Future Fund” starting with $3b to $4b that will invest in diversified assets along the lines of the NZ Super Fund.
The fund will include the council’s remaining $1.3b share portfolio in Auckland Airport that could be sold down, and possibly the $833 million of proceeds from the partial sale of council shares in the airport this year.
Council Treasurer John Bishop said it was not sensible for the council to have all its eggs in one basket, saying the council has eggs in two baskets (Port of Auckland/airport shares), and what a fund does is diversify the risk and invest in hundreds or thousands of different securities.
Councillor Richard Hills is concerned about the sale of a long-term lease in the Port of Auckland business. Photo / Alexia Russell
Several councillors expressed concerns about the sale of a long-term lease of the port business. Councillor Richard Hills was “extremely nervous” about the port lease.
“My values on privatising that lease until I’m over 70 just doesn’t sit comfortably with me,” Hills said.
Another budget proposal is to combine back-office services for all council-controlled organisations (CCOs) such as IT, property management and HR, and defunding earthquake strengthening.
Cr Christine Fletcher said the current situation for Auckland Council is not sustainable and welcomed the open-mindedness to look at the balance sheet and an Auckland Future Fund that she strongly believed will make a difference.
“We can’t keep doing more of the same,” Fletcher said.
Following public consultation in February/March and comprehensive deliberations, the 10-year budget will be finalised and adopted in June 2024.
Bernard Orsman is an Auckland-based reporter who has been covering local government and transport since 1998. He joined the Herald in 1990 and worked in the parliamentary press gallery for six years.
