Council’s politicians jacked up rates by 9.9 percent via a transport levy saying it was for building more transport infrastructure. In reality Auckland Council is wasting so much money that Auckland Transport has even less money to spend on this year than last year.
Economic management by members of the finance committee has been so bad it has increased Council’s total liabilities by 60 percent in the last five years and by 15 percent in the last 12 months alone. Said another way, Auckland Council now has $10.09 billion in liabilities. Putting this into perspective, every Auckland household now owes around $20,000.
Auckland Council’s per capita debt is now so high that it is worse than the failed Kaipara Council of 2012. These trends are deeply worrying and are reminiscent of the old Rodney District Council’s financial performance. This should be of significant concern to every ratepayer.
Despite record low interest rates, the Council’s annual interest repayments now amount to a crippling $422 million (that’s $1.2 million a day), up $50 million on last year. Under Mayor Len Brown, Council has borrowed to its maximum capacity, effectively cornering any new Mayor with no additional capacity to borrow without degrading Council’s credit rating thus increasing interest rate charges, or being forced to increase rates, or both.
Council budgeted for a wage bill of $729 million (already up a whopping $49 million on the previous year), but has actually spent $792 million, blowing the budget by $63 million. No one, including the chief executive, is being held to account because the Mayor’s team claim that overall the Council is in strong financial shape.
Out of the Super City we simply wanted to see local rates being spent locally through local democracy and for transparency over value for our money. We also had to have faith that the efficiency gains and the cost savings that were originally promised would be a priority. This has all failed to be delivered.
Our next Mayor will inherit an enormous financial challenge to right a badly listing ship.