Council debt up $1b in 12 months, 1,165 staff earning over $100k

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, says Auckland councillor Cameron Brewer.

The Auckland Council has started reviewing its 12-month performance to the year ending 30 June 2012. Mr Brewer said it was surprising to see in the draft 2011/12 Annual Report that total council group debt had 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 revealed 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

Mr Brewer said councillors would be watching these numbers closely and notes that those 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.”

Mr Brewer says 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,” says Cameron Brewer.

ENDS

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