Auckland's future funding discussed
Auckland Council will need to find $2.8 billion of savings if it wants to keep rate rises to 2.5 per cent according to budget plans released today.
All spending was under the microscope at today's Auckland Council long-term plan (LTP) meeting to decide how the city should develop over the next 10 years and how it should be funded.
Over the eight years to 2022 the council plans to spend a further $12.1b to upgrade existing assets and add new ones. This includes $5.9b for transport; $3b for water and sewage and $1.3b for community and cultural facilities.
This comes at a cost and the current plan projects an average rates increase of about 4.9 per cent each year, and an increase in net debt to $13 billion by 2022. Last year Mayor Len Brown said rates would rise by only 2.5 per cent.
The documents said lower rates increases would require a significant overall cost reduction and focus on the things that would make the most difference.
Brown said: "We need to make some tough choices to find the right balance between progress and affordability.
"Today we begin the conversation about how much we spend, when we spend it and what we spend it on to ensure Auckland's communities and economy continue to prosper and the city remains a great place to live for all Aucklanders."
In the coming months Auckland residents will be asked which investments are the most important and affordable to grow Auckland over the next decade.
The LTP is reviewed every three years. The next 11 months will see an extensive consultation process involving the council, its council-controlled organisations, and the people of Auckland. The revised LTP for 2015-2025 is due for adoption June 2015.
"Aucklanders want progress, especially on affordable housing and transport, but we know there is no appetite for large increases in debt and rates, so the next phase we begin today challenges us to find the trade-offs over the coming months to ensure increases are sustainable while still delivering on our promises - we can't afford to do it all," Brown said.
The latest LTP provides Auckland Council with its first opportunity to realign budgets and develop a 10-year programme of work based on a single plan and vision for the city.
Auckland Council Chief Executive Stephen Town said: "To limit rate rises to between 2.5 per cent to 3.5 per cent, we need to be innovative and bold in looking at alternative revenue sources, reprioritising spending and finding cost savings to achieve our financial targets and take the pressure off households."
The mayor's proposal will be presented in late August, and then go out for public consultation so Aucklanders can have their say on shaping the city's future.