Below-estimate contract prices have helped the New Plymouth District Council record an $11.7 million surplus for the 2011/2012 financial year.
It will now be up to councillors to decide how to use the surplus, which amounts to nearly 10 per cent of its income and came about from savings on interest payments, depreciation costs and the Waitara-New Plymouth sewage pipeline coming in under budget.
Options for using the cash include paying down debt, topping up the Perpetual Investment Fund or using it to potentially shave a few percentage points of predicted rates rises in the coming years, which will average 5.5 per cent until 2022.
External debt from last year remains unchanged at $104m, but the surplus comes as Taranaki Investment Management Ltd reported a 2 per cent loss on the council's perpetual investment fund.
The council honey pot now sits at $227m, $32m less than when it was established from the sale of the council's Powerco shares in 2004.
Since that time the fund has also paid out $160.1m to the council or about $20m a year. Those release payments will be scaled back over the next 10 years to allow the fund to return to its real 2004 value, something Harry Duynhoven had campaigned on doing when running for mayor in 2010. The fund peaked in value at $324.7m in June 2008.
"The PIF had a challenging year, which is unsurprising given the continuing effects of the global financial crisis," Mr Duynhoven said.
"Clearly we are not immune to the effects of a weakened global economy but I think we should all be proud that our district remains a great place to live, visit and do business."
- © Fairfax NZ News
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