Media statement                   Tuesday, May 12, 2009

Productivity improvements are key to council woes      

Cutting costs and operating more efficiently are the best ways for Tauranga City Council to get through the next three years, said the Employers and Manufacturers Association (Northern) or EMA at a council hearing yesterday.

EMA executive officer Peter Atkinson represented approximately 300 local businesses that are EMA members, in delivering our Long Term Council Community Plan submission.

Mr Atkinson says, “As the council’s qualified audit report stated, the 10-year plan is not financially sustainable after the third year. Council has acted openly and responsibly by going to ratepayers and putting all its cards on the table in a very readable newsletter.

“But the key point we wish to make is that Council needs to aggressively pursue productivity improvements rather that resort to increasing rates and user fees.

“The council should maintain its service levels as much as possible, whilst at the same time reducing the costs of the services it provides. This is what businesses – and households - have to do in the face of difficult circumstances and is what we believe the council needs to do as well.

“We don’t want the council to defer capital expenditure (capex) because it is critical that spending on things that will improve regional productivity is carried out at this time, and is seen as an investment. And deferring capex just creates a backlog that has to be dealt with later.

“We acknowledge the excellent track record that Tauranga City Council has had as far as rates increases go (Tauranga has one of the lowest rates per person in New Zealand) but there is a need for the council to be firm about holding to that course.

“EMA accepts that at the end of the day, because of the growth the city is experiencing, there may be a case for increased rates and user charges. However, these increases should be modest and only after the introduction of measures to increase productivity.”

 
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