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Auckland Council adopts Emergency Budget

Published: 30 July 2020

Funding to retain key council services and deliver a $2.57 billion infrastructure programme to stimulate economic recovery, while adjusting to a severe fall in income, is at the heart of Auckland Council’s Emergency Budget, formally adopted on 30 July by the Governing Body.

The Budget responds to the significant economic impact of the COVID-19 pandemic and lockdown, as well as the severe water supply crisis the region is experiencing.

Auckland Mayor Phil Goff says, “Thanks to the collective effort of all Kiwis we have stopped the spread of the virus in our community. However, while potentially thousands of lives may have been saved, the impact of the pandemic will seriously hit jobs and our economy.

“Auckland Council is confronting a nearly half-billion income shortfall because of the pandemic and associated lockdown. On top of that, we have had to meet an additional unbudgeted capital investment of $224 million to bring forward water infrastructure projects to deal with the worst drought Auckland has ever experienced.

“Managing our finances responsibly is critical. With less money available, we have had to significantly cut expenditure and reduce staff numbers. Over a thousand jobs at council will be disestablished, non-essential spending has been slashed, and over $240 million worth of surplus properties and non-strategic assets will be sold to reduce debt. Our organisation has to become leaner and more adaptable.

“Despite this significant cut in spending, we will maintain the essential services Aucklanders need and value, in areas such as transport, waste and recycling services, parks and playgrounds, libraries and community facilities and other areas,” the mayor says.

“We have also strived to maintain investment in critical transport, housing and environmental infrastructure, resulting in expenditure of $2.57 billion this year, slightly lower than the pre-COVID-19 estimate but well above the average capital investment over five years of $1.6 billion.

“This investment will help stimulate employment and economic growth and address the backlog of projects needed to make up for the decades of underinvestment in our city.”

A careful balance

Chair of the Finance and Performance Committee, Councillor Desley Simpson, says that the Emergency Budget strikes a careful balance between prudent financial management and the need to protect key services and invest in the city’s future.

“We are maintaining a disciplined approach to our finances, managing debt prudently to protect our strong credit rating with international rating agencies, and ensure generational fairness.

“On top of this, we are doing everything we can to help ourselves by cutting non-essential expenditure, deferring capital projects where possible, finding $200 million of savings across the council family including $75 million of cuts to the council’s staffing budgets.”

“These measures help to balance spending to support the key services Aucklanders need and value, like our libraries, recycling services, transport concessions, road safety and local board-led community projects.”

“We will also continue to provide the infrastructure investment our city needs to ease transport and housing pressure, give certainty to the construction sector and support employment and economic recovery.”

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