Promised Council Savings An Epic Fail

At the last elections Mayor Goff promised he would make efficiency gains in Auckland Council of between 3 to 6 per cent saving $72 million a year.

Internal documents reveal that Goff only found 0.3% in spending cuts. If that isn’t bad enough half of that was from Auckland Transport, which was done by capitalising some opex. Only 0.03% came from savings from within the parent Council organisation itself. That is an epic fail.

So the Mayor has relaunched his efforts announcing a Value-for-Money study boasting $373 million in potential savings. Goff said in his press statements that the savings would be reinvested into vital services and infrastructure for Auckland.

The $373 million is for identified potential savings over a 10-year period. To put that into context that’s $37.5 million of possible savings a year, or 1% in theoretical savings. It is another epic fail because until these savings hit the financial statements Aucklanders can have little faith that they will ever be delivered.

Alarm bells should be ringing about Council’s ability to deliver, signalled by the wages blowout at Auckland Council. For another consecutive year the wages bill has blown out by $42 million to $853 million. The equivalent of a 3% rates increase just to compensate for the poor financial management around delivering to budget.
Alarm bells

The previous three years has seen the wage budget exceeded by $32m, $63m and $50m. How on earth can Aucklanders trust the Council to be responsible with their money. Mr Goff has failed to deliver any meaningful changes to the Council’s overspending culture or to improve its ability to deliver on targets.

So perhaps it’s not surprising that thoughtful commentators from across the political spectrum are speaking out about an Auckland Council that is perceived to be becoming increasingly ineffective, undemocratic and misguided.

With promises not kept the Mayor’s new plan is to tax Aucklanders. Council actually needs to stop wasting money and make the 3% to 6% savings, rather than putting its hands deeper into ratepayers pockets.

Housing affordability will see the most disadvantaged families carry the biggest burden from applied fuel taxes and targeted rates. The Mayor’s inability to secure in-house budgetary savings is set to punish those who can least afford it. Council is losing its way.

Perhaps all the extra revenue raising would be acceptable to Aucklanders if the promises to cut wasteful spending, to find promised efficiencies, and to have any savings directed into infrastructure had happened. But none of this has happened.

Aucklanders understand there are questions around huge funding shortfalls. However, the Council’s proposed budget has no timely solutions for these, which is plainly not an acceptable answer for Auckland.