15 October 2012

Council reports budget surplus for first quarter

The Palmerston North City Council has recorded an improved operating position of $1.2million for the first three months of the 2012/13 financial year.

Chief executive Paddy Clifford said while it was a good start to the year there are likely to be challenges ahead.

“We’re pleased to be reporting a positive result. However, continued pressures on services and uncertain revenue means staff remain focussed on making savings wherever possible. Due to continuing subdued economic growth we expect another tough year and we have made it a priority to strive to meet the allocated operating budget.”

Chief financial officer Grant Elliott said the lower level of expenses than predicted needs to be considered in the context of the whole year.

“We remain confident that the full year controllable operating budget will be achieved, however with no adverse weather events to date lower expenses have been incurred. These savings are likely to be utilised in remaining months and so we need to continue focussing on restricting spending and looking for the most economical way to deliver our services”.

Financial accountant Keith Allan told Councillors at this afternoon’s Finance and Performance Committee meeting that overall indicators pointing to improving business confidence are starting to have a positive effect on the Council’s overall financial position.

“During the quarter development contributions of $4.6m were received. Council has budgeted for Development Contributions over the last few years however the recession delayed receipt,” said Mr Allan.

“Development Contributions are applied against growth capital expenditure either incurred previously or required to cope with related new infrastructure development. This, plus related vested assets received, have resulted in a net surplus of $11.2 million.”

The year’s Capital Expenditure programme has commenced with $3.2 million incurred in the quarter against a budget of $4.5 million. The overall capital programme budget for the year is $32 million.

Copies of the Quarterly Financial Report can be found in the Finance and Performance Committee Agenda at pncc.govt.nz.

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