Your Questions Answered - Simple approach to financial sustainability

 

The Council passed its Long Term Plan last week. This is the last that Commissioners will oversee. This Plan extends through to 2025. 

Your Council has a sustainable financial base, with many of the historical problems put behind us. The Plan has the Council focus on building the infrastructure that enables a great future for those who live here, holiday here or do business here. 

We want it to be “easy” to live and do business in Kaipara – for this we want rates to remain affordable, people and business to have access to necessary services, and our regulatory framework to let the right things happen in the right way. Our regulatory framework is designed to ensure that our environment, from west to east coast, is nurtured wisely. 

Many financial demands
We have many challenges to achieve this vision. There are lots of demands on Council funding – funding mainly collected from your rates. 

For example, we need to replace old pipework in towns where population numbers are low and sometimes falling. We have budgeted to catch up on a maintenance backlog of our water supply, stormwater and wastewater infrastructure in the next 30 years.  

We have kept our core services at a relatively basic level and the Plan only invests modestly in community activities. We have included a small increase in the community development budget to allow Council to support more community work. We are aware of how important a sense of community is, and how much volunteers already do. We will continue to rely on volunteers to develop our communities. 

The Plan puts more funding into some parks. We are collecting and releasing Reserve Contributions for such amenities as subdivisions are approved. We have given Mangawhai Community Park, Harding Park/Pou Tu o Te Rangi, and Taharoa Domain (Kai Iwi Lakes) priority for extra development. All these parks are co-governed with partnerships between Council and Iwi or Council and the community. 

We are requiring forestry owners to help pay for the strengthening of roads that they use. Logging will be high for the next six years. Forestry owners will be charged a targeted rate for these six years so that Council can strengthen the roads used by logging trucks to keep them in good condition for all users.

Infrastructure needs attention
We have retained a small rates increase for most people across the 10 years. The increase of revenue we collect from rates is around 3.5 percent each year for the 10 year period. We have slowed our debt reduction, from a previous target of $50 million to a level of $60 million by 2025, to allow

increased spending on fixing up our infrastructure – mainly renewing pipes. Council’s debt when Commissioners were appointed in 2012 was $80 million.

Council’s approach to sustainable financial management is simple.

* We will cap rates revenue increases; 

* We will run a balanced budget; 

* We will reduce our debt year on year; 

By applying these principles, we will set Council up to be in good financial shape for years to come.

Commissioners acknowledge the engagement and advice of the community as this Plan has been put together, and the considerable work by Council staff throughout the process. Thank you. This is a sound Plan, in which you can have confidence.

How do we compare with our neighbouring Councils?
Auckland, Whangarei and Far North Councils have decided their final Long Term Plans also. They all have average rate increases for the coming year above Kaipara’s. And unlike Kaipara, over the 10 year term of their Plans, none of these Councils have debt decreasing, though Whangarei’s debt only rises slightly. 

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