Have your say on Auckland Council’s Emergency Budget 2020/2021 (feedback form)
Auckland Council has produced an Emergency Budget to address the $525m shortfall in revenue due to COVID-19 and in so doing has to make some tough decisions about where to find significant savings and what to prioritise. This is an historic and crucial time for you to provide feedback.
City Vision says a 3.5 per cent rates increase is necessary to ensure the final budget for 2020/2021 maintains essential community services and facilities, environmental programmes, key infrastructure projects, jobs and a living wage for Council’s employees and contractors.
Here is some background to the consultation, why City Vision supports a 3.5 per cent rates rise and details about completing the online form.
COVID-19’s financial impact on Auckland Council
The draft Emergency Budget 20/21 shows Council’s income is going to be down by $525m because of reduced use of council facilities and public transport, reduced fees from building consents, other charges and development contributions, and reduced dividends from the Ports and Auckland Airport, all resulting from the COVID-19 pandemic. That means there will have to be spending reductions on services and capital programmes. Asset sales and more borrowing will be necessary to make up the funding gap, which is predicted even with significant spending reductions across Council.
Aucklanders’ rates rise choice
Through the consultation process, Aucklanders are being asked whether they support the previously agreed 3.5 per cent average general rates increase, or a lower increase of 2.5 % ($1.82 or $1.35 per week for the average value residential property).
The draft Emergency Budget was written by Council finance staff under direction from elected members. We all want Auckland to recover from the lockdown and to minimise job losses and cuts to essential services and capital projects. Rates make up only 40 per cent of council’s income so there is now even more reliance on rates to provide necessary funding.
If council doesn’t increase rates or opts for a rates freeze Auckland Council is at risk of debt levels becoming unsustainable and would need to make savage cuts to well-loved and heavily used services and facilities and pull back on commitments to tackling climate change, water quality and road safety. Let there be no doubt that permanent closures would also be required and thousands of jobs lost.
City Vision supports a 3.5 per cent rates rise
City Vision supports the 3.5 per cent increase for good reasons. A 3.5 per cent increase:
- maintains contributions from those who can afford it whilst offering targeted financial support to those who can’t (This is covered in the Auckland Council’s Rates Remission and Deferral Policy also out for consultation and which we also support).
- provides the key to unlocking higher, and cheaper, levels of borrowing that are going to be vital.
- minimises cuts to jobs and essential services, securing the least painful recovery.
- minimises cuts and deferrals to capital development, achieving the most forward looking recovery, with green jobs and real progress on reducing emissions.
- Mayor Phil Goff and City Vision committed to a maximum 3.5 per cent rates increase during the 2019 election
What’s wrong with the 2.5 per cent increase option?
Cuts in operational and capital expenditure will have to be much higher than with a 3.5 per cent increase. Some libraries, pools and community centres would have to close and all would have shorter hours with hundreds of staff made redundant. Fares would go up, including for senior citizens after 3pm. Choosing the lower, 2.5 per cent increase will not only increase the funding gap, it will also reduce potential borrowing levels because of lower income.
Lower revenue means Council’s creditors may be willing to lend less, and at higher interest rates because the risk profile will be higher. We would need to argue for a higher temporary level of borrowing to protect and maintain more jobs and services than the budget currently proposes. A zero rates rise is not an option because it would have severe impacts on cutting vital council services, slashing investment in much needed new infrastructure, pushing up debt levels and reducing employment and business activity in Auckland.
The online form covers four questions and is easy to complete and submit.
You can access the on-line feedback form here
Question 1 General rates increase for 2020/21
We strongly recommend you support a rate rise of 3.5 per cent.
Where it asks: Tell us why, we urge you to say in your own words:
I support maintaining the Council’s planned 3.5 per cent rates increase in order to contribute to Auckland’s recovery and rebuild by maintaining businesses and jobs, investing in people, communities and the environment.
I support prioritising investment in initiatives that will restore Auckland’s environment and will reduce Auckland’s emissions including energy efficiency, safe walkways and cycle ways.
I support the Living Wage for all staff and contractors.
I support council services, programmes and facilities that contribute to community opportunities and wellbeing including libraries, the arts, pools and community centres.
You may also want to state why you might support a rates increase higher than 3.5 per cent and / or temporary borrowing more than is proposed.
Question 2. Rates postponement for ratepayers impacted by COVID-19
We recommend supporting the proposal because it gives essential relief to households and businesses that have been particularly adversely affected by the COVID-19 lockdown and its consequences.
Question 3. Suspending the targeted rate paid by accommodation providers
We recommend supporting the proposal because all temporary accommodation providers have been hard hit by the loss of visitors and tourists to Auckland.
Question 4. Other feedback – what is important to you?
You can use this section to give feedback on any other issue.
You can mention specific examples of local board projects that you support.
You can point out any services, facilities and programmes that you believe to be vital to maintain for Aucklanders’ health and well- being, reduce inequality and support the most vulnerable. Give reasons why you believe this.
You do not have to respond to all four questions when completing the online form. You can also give feedback by email, by post, by social media (using the hashtag @AKhaveyoursay) or by phone. More details here.
Feedback is due by 19 June
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