Tuesday, 2 December 2014

Auckland grandomania ever-more costly for ratepayers

ACT leader David Seymour has written a great short piece in the Herald attacking Auckland’s “Super-Council” for its debt, over-spending and rates rises.

Auckland Council needs to stop and take a breath, he says, citing its vote

by a narrow majority to impose grotesquely large rate increases on thousands of Auckland's ratepayers. The increases are staggering: 126,000 households will face increases of 10 per cent or more, 25,000 of 20 per cent or more, and almost 4000 of more than 40 per cent…
    The increased pressure on rates is largely due to three factors: setting the Uniform Annual General Charge (UAGC) at far too low a share of rates revenue; not having a gradual transition to a property value basis for rating; and … what is perhaps our biggest challenge - the council's spending surge.
    Grandiose spending plans are driving projected rate rises of 4-5 per cent a year to 2022. The draft annual plan has capital expenditure running at more than 10 per cent a year from 2017 to 2020.
    The council's debt level is set to nearly triple in just 10 years, rising from $4.8 billion to $12.5 billion by 2022. And who could possibly believe there won't be cost-overruns pushing this even higher?
    What happens if interest rates rise more than expected?
    Last month, international ratings agency Standard & Poor's put Auckland Council's 'AA' long-term credit rating on negative watch because of concerns about rising debt.
    And remember, the rating is only 'AA' because ratepayers are on the hook for whatever might happen.
    When you're in a hole, you should stop digging. This council is instead digging all the more furiously.

All very good and valid criticism.

And all fatally weakened because every reader sympathetic to his viewpoint will remember how we got this over-spending “Super Council” in the first place – a process in which grandstanding former ACT leader Rodney Hide delivered a grandiloquent super-bureaucracy over which a mayor would have significant executive powers to a mayor infected with grandomania.

Which suggests a grand old problem for this latest ACT leader to get his head around. He must at some stage either repudiate the many failings of that previous leader, or remain silent for evermore on the many and catastrophic failures of this  “Super-Council” Hide bequeathed upon us.

Which is not a position a diligent Epsom MP can really take.

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