Council debt rising by $3m per day – it now totals $5billion

Opinion by Councillor Cameron Brewer
Auckland ratepayers will be shocked to learn that council debt has escalated at a rate of nearly $3m a day in the past 12 months and that 1,165 Auckland Council staff now earn over $100,000.

The Auckland Council has started reviewing its 12-month performance to the year ending 30 June 2012. It’s surprising to see in the draft 2011/12 Annual Report that total council group debt has gone from $4.0b to $5.0b since the 2010/11 Annual Report was presented 12 months ago. (Excluding CCO debt, the council’s own parent debt has gone from $2.9b to $3.8b in the past 12 months) *1.

The Mayor plans to triple council debt this decade and has already lifted the debt ceiling to enable this. However the fact that we’re up a billion dollars in the last twelve months alone shows that debt is blowing out faster than most of us thought. It’s a real worry because it’s future ratepayers who will be lumped with the crippling interest payments.

In this economic environment, household debt has been shrinking so it’s totally out of whack to think that total council borrowings have gone up 25% in the past year alone.

And it’s not as though we’re short of revenue. The latest annual report shows an annual income stream of nearly $3billion, with about half of that coming from rates.

The 2011/12 Annual Report also reveals that 1,165 staff earn more than $100,000 with 564 of those staff working in the council-controlled organisations. Of the 1,165 staff, 123 earn over $200,000 with 82 of those working in CCOs.*2

Councillors will be watching these numbers closely; the numbers exclude the many consultants and contractors engaged by the council.

The average wage and salary in New Zealand is pretty low and incomes have barely gone up in recent years. Auckland Council has got to pay professionals a professional salary but we’ve also got to keep a lid on increases and be conscious of ratepayers’ expectations and the fact that many are hurting out there.

A lot of great things have been achieved by council over the past 12 months but the Mayor’s got to focus more on affordability.

For the majority of Aucklanders their rates have just gone up significantly and all they can see is the council asking for more and more. People worry about prospective motorway tolling or an additional regional fuel tax, region-wide user-pays rubbish is coming, and the council is also considering banning all open fireplaces.

To now also tell ratepayers that debt’s up by a further $1b in the past 12 months, and 1,165 council staff are earning over $100,000 will only add insult to injury for many.

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  1. paul De Rungs, 30. September 2012, 14:54

    Too many greedy snouts in the Public trough. Where is the public accountability and transparency?

  2. J, 9. November 2012, 12:55

    ‘Too many greedy snouts in the public trough?’ Ask Cameron Brewer; he’s the one angling for a neo-conservative rightwing political career. He truly misses having John Banks as Mayor and helping to sell off all the Local Government as in Local People’s assets.

    No doubt Cameron Brewer will be first out of his stall to vote for all cuts to social housing, library futures and everything that isn’t sewerage.

  3. J, 9. November 2012, 13:02

    Also, it’s hilarious to pretend that costs would not have increased when having this new overblown CCO arrangement was all about creating powerful CEOs of opaque CCOs earning huge undeserved salaries, which took away any REAL decisionmaking process from the people of Auckland and in effect gave it to this current government through its 2009 cunning legislation.