|
Resolution
number GB/2022/134
MOVED by Mayor W Brown, seconded by Deputy Mayor D
Simpson:
That
the Governing Body:
a) agree
to a preferred mix of budget levers to address the estimated $295 million
operating budget gap for 2023/2024, as the basis for consultation on the
Annual Budget 2023/2024, which includes:
i) additional
operating savings of $130 million across the council group over and above
existing budgeted savings targets including:
A) $60
million of operating savings for Auckland Council as set out in
recommendation b) below;
B) $25
million of operating savings for Auckland Transport, including increased
projected revenue of $4 million resulting from the decision of the Auckland
Transport Board on 1 December 2022 to increase public transport fares by a
weighted average of 6.5% to be implemented this financial year, and
consultation via the Annual Budget 2023/2024 on a $21 million reduction in
council operating funding provided to Auckland Transport resulting in the
current number of public transport services (as of December 2022) to be
maintained for 2023/2024;
C) $27.5
million of operating savings for Tataki Auckland Unlimited, including a $10
million savings target to be achieved by undertaking a comprehensive
post-merger efficiency programme, including driving revenue opportunities and
prioritisation across the entire organisation, and consultation via the
Annual Budget 2023/2024 on a $17.5 million reduction to council operating
expenditure funding provided to Tataki Auckland Unlimited with some
implications for service delivery and pricing via the Zoo, Art Gallery,
stadiums and venues and some reductions in events and economic development
activity;
D) $5
million of operating savings for Eke Panuku, including the deferral of $20m
of capital works from 2022/2023 and $36 million from 2023/2024 focusing
investment on essential priorities and committed capital works, and reducing
the direct operating costs of property management and urban regeneration
activities;
E) a
further review of revenue, capital and operating budgets as part of the work
programme of the Expenditure Control and Procurement Committee, tasked with
identifying additional operating cost savings of $7.5 million for Auckland
Transport and $5 million for Auckland Council and the other CCOs
ii) consultation
on a proposed amendment to the Airport Shareholding Policy in the Long-term
Plan 2021-2031 to provide for a full sell down of the council’s 18.09%
shareholding in Auckland International Airport Limited
iii) consultation
via the Annual Budget 2023/2024 on a proposed average general rates increase
of 7% for 2023/2024, with the following rating policy adjustments that will
result in an overall 4.66% rates increase for the average value residential
property:
A)
pausing the Long-term Differential
Strategy for one year and extending the time by which the target share of
25.8 per cent of rates to be raised from business properties is achieved to
2038/2039
B) reducing
the Water Quality and Natural Environment Targeted Rates for 2023/2024 by two
thirds while still maintaining the associated planned work programmes
iv) a
modest increase of up to $75 million of additional debt funding of the
capital programme which will free up rates funding for operating purposes
b) agree
to progress the proposed $60 million of operating savings for Auckland
Council from 2023/2024 through:
i) directing
the Auckland Council Chief Executive to reduce $12 million of operating costs
for 2023/2024 under delegation through:
A) implementing
group shared services including corporate accommodation changes
B) simplifying
and consolidating group strategy and policy activity
C) optimisation
of, and minor reductions to, open space levels of service delivered through
the Parks and Community Facilities full facility maintenance contracts
D) changing
the budgeting method for healthy waters maintenance
ii) consulting
via the Annual Budget 2023/2024 on the following items:
A) $20
million reduction in general rates funding of regional services such as
community and education programmes, regional events, economic development and
other social activities
B) $8
million reduction in regional contestable grants
C) $16
million reduction to Local Board funding, representing a 5 per cent reduction
in the overall operational budget for local activities
D) $3
million of proposed changes to fees and charges
E) withdrawing
from the direct provision of early childhood education services with an
estimated reduction in general rates funding of $1million
c) agree
that the consultation document for the Annual Budget 2023/2024 include
information on alternative options of a higher average general rates increase
of up to 13.5% and additional use of debt within existing policy limits to
ensure that the Council has sufficient flexibility to respond to public
feedback on the proposed levers or further financial challenges between now
and final decision-making on the Annual Budget 2023/2024
d) note
that Chief Executives across the council group will continue to progress the
achievement of existing efficiency savings targets for 2023/2024, including a
$30 million operating cost reduction target primarily focused on support
services including simplification of management portfolios and structures for
Auckland Council
e) note
that Ports of Auckland have committed to an improvement in their net
operating performance (from $42 million to $52 million) and dividend
projections of $10 million for 2023/2024
f) agree
to consult alongside the Annual Budget 2023/2024 on a change to the
council’s Revenue and Financing Policy to enable the Long-term
Differential Strategy to be paused for one year and extend the time at which
the target share of 25.8 per cent of rates to be raised from business
properties is achieved to 2038/2039
g) note
that the consultation document for the Annual Budget 2023/2024 related to
amending the Airport Shareholding Policy to provide for the full sell down of
the shareholding in Auckland International Airport Limited, will include
information on alternative options including:
i) partial sell down of
approximately 8% and maintaining at least a 10% ‘blocking stake’ shareholding
ii) retention of the current number of
shares as per the current policy.
CARRIED
|
