Auckland Council Austerity Budget Part of the Problem not the Solution

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Submissions on the Auckland Council ‘Emergency (COVID) budget’ closed on Friday, and received many more submissions in this special consultation than it did with its business as usual budget, first time round, earlier this year.

Just when the Council’s annual plan indicated a small step towards overdue environmental, infrastructure and social equality, it has reviewed its budget in light of expected income slumps, and suggests cutting all things good in favour of austerity, prioritising contracts where commitments have already been made with socially distorting effects.

The unprecedented review of the prior budget has been brought about because of reduced revenue and expected ratepayer hardship resulting from COVID-19. Income is expected to be around $525million less than first budgeted, due to lower dividends (for example from Auckland International Airport and Ports of Auckland), fewer public transport fares, lower fuel tax income, less event and facilities revenue and fewer developer contributions and regulatory services fees.

The Council considered a range of budget reduction options, and Councillors will now have to grapple again with weighing up whether to proceed with a / any planned rates increase to make up the shortfall.

But make no mistake, the ‘austerity’ options proposed, aren’t politically neutral. There’s nothing immutable or fixed, and there are no ‘necessary’ measures in the budget that aren’t a reflection of ideology. Even though conservative elements always fall back on the catch-cry “focus on core and essential services”, it remains to be discussed, what are core versus discretionary functions for local government. Indeed, your essential service is my discretionary one, and vice versa. Where you stand will depend on where you sit – and that will partly depend on where you sit in the socio-economic hierarchy.

In a democracy, each view should be valid, equally considered, without privilege, and determined through debate, discourse and deliberation. However, under the SuperCity, the opportunities formerly provided, pre-amalgamation, to even speak to your annual plan submission have been eroded. And participation in local government is generally loaded toward wealthy, white ratepayers rather than renters or citizens, or the working class. We have less democracy now than we did before. And despite an anticipated increase in participation from younger cohorts, the political prerogative to keep rates low is a strong one, even without economic duress from COVID-19. Just when the budget was actually looking progressive, equitable and toward addressing the existential issues of the future, a crisis occurs that drives the agenda for cuts.

But austerity is a solution looking for a problem. Instead of amplified investment to stimulate the economy and to respond to Aucklander’s lockdown love affair with walking and cycling, the ‘There is No Alternative’ budget slashing mantra comes to the fore.

But just look at what’s proposed to be cut – and assess whether it feels politically neutral: a delay in new climate change responses; a cut to support for initiatives addressing homelessness; a delay in extending the living wage to contract cleaners; cancelled public transport fare subsidies for children; reduced investment in Māori outcome projects including marae and papakainga safety; delayed walking and cycling projects – while acknowledging this will cost lives; defered regional parks track upgrades and cancelled parks events; community facilities, library, halls, and playground closures; reduced public transport services and road and footpath maintenance and less investment in environmental services. This is cutting costs for the present to punish generations in the future.

The draft budget allegedly prioritised ‘financial prudence’, honouring contractual and statutory obligations, public health and safety, asset integrity, Māori outcomes, jobs and employment, ease of implementation, protecting the most vulnerable and “supporting our communities”, -“avoiding making them worse off”.
However, the budget also acknowledges that the proposed cuts will also have a disproportionate effect on lower income households and those communities most in need.

The Mayoral budget (cut) recommendations proposed deferring the living wage roll-out, Housing First, climate change responses, marae development, and the closure of community facilities. And even though there are also staff cost reductions proposed, and some Councillors have volunteered to donate some of their salaries to charity, the Mayor ordinarily earns $296,000 per annum, 86 staff earn more than $250,000 p.a., seven staff members earn more than the Prime Minister. And the Council will retain its $98million spending on the America’s Cup.

Auckland’s five substantive “Council Controlled Organisations” are under review – to assess whether they are sufficiently efficient, responsive, accountable, well governed; whether they appropriately reflect the Council brand, if their roles are appropriately defined, if there’s unnecessary duplication, and if there are other viable service delivery models. But the review has been overtaken by COVID-19, and opportunities for rationalisation of the CCO’s, and amalgamation of their functions – while perhaps obvious targets to address savings, are not on the table for the emergency budget. Proposed reform in the emergency budget disproportionately impacts the very community services local government is designed to deliver, while leaving publicly unaccountable, overpaid, duplicative CCO’s intact.

The law of Maslow’s hammer has it that if all you have is a hammer, everything looks like a nail. The recourse to slashing community investment, future proofing transport, saving lives with better walking and cycling and road safety, fire sales of community assets, retrenching services, neglecting existing infrastructure, abandoning recreational services in the community while retaining spending on elite yacht racing, and cancelling living wage increments while top dogs get paid hundreds of thousands of dollars, reminds us that the hammer of austerity is an ideology ready poised to hit any progress right on the head.

If the Council is serious about public health and safety, Māori outcomes, community support and asset integrity, Councillors will vote to maintain higher rates, socialising the costs across the wider ratepayer base; they would review support for the America’s Cup, they would turn their attention to a root and branch reform of the CCO’s. They would fund the living wage for contract cleaners and reduce inflated executive salaries. They would recognise that public service is about the public good, and future investment requires bravery now, most of all, courage to invest in their communities. They would recognise that austerity is an ideology, a choice, that’s loaded in favour of entrenched interests and comparatively wealthy elites, both within society and within Council staff.

This week, Stephen Town, hitherto Auckland Council’s Chief Executive departed the $698,000 role. At forty hours a week, that’s about $335 an hour. Meanwhile, if the Council won’t find the money to pay its (contract) cleaners a living wage of $22.10 an hour, and cuts community services, it is part of the problem, not the solution.


13 COMMENTS

  1. Maybe there ought to be a 99 per cent marginal tax rate on incomes above double the average wage. That would wipe the grin off a few faces.

    • “a cut to support for initiatives addressing”

      Ensuring everyone in this city is housed ought to be the Councils top priority. Mayor Goff spent thousans counting the homeless, he knows where they are, who they are, and then doesn’t provide a solution ~ which is obviously ‘council housing’.

      Instead we get pink cycle tracks and unused bike ways all over the place. We’ll that’s probably unfair I do see middle class lycraites using them on the weekends.

  2. ‘the Mayor ordinarily earns $296,000 per annum, 86 staff earn more than $250,000 p.a., seven staff members earn more than the Prime Minister. And the Council will retain its $98million spending on the America’s Cup.’

    ‘This week, Stephen Town, hitherto Auckland Council’s Chief Executive departed the $698,000 role. At forty hours a week, that’s about $335 an hour.’

    Says it all!

    The mayor doesn’t EARN 296,000 per annum. That’s what he gets for majorly fucking up most things he touches.

    And you can bet your bottom dollar the ’86’ don’t EARN what they get: local government is the best rort available in NZ. Overpaid and unaccountable. Yes. Also incompetent.

    As for the $98million spending on the America’s Cup, well, there’s unlikely to be America [in the sense most people think of it] at the end of this year, as Covid-19 and Donald Trump rip it to shreds and the bubble the Fed has been inflating for so long bursts.

  3. You were all warned.

    There’s an old proverb in investing: Weak hand fold, and Auckland council is now a weak hand. Since the advent of the ‘supercity’ it has been controlled by left leaning mayors and councillors who have failed to manage its head count and poured ratepayers money into ill considered and poorly costed vanity projects.

    Two billion dollars on the CRL quickly turned into 4 billion and now we hear that an external audit expects over 3 billion more! So a 2 billion project is now expected to exceed 7 billion. We’ve seen a multi-million dollar pink cycle way and an ‘art mirror’ that crack in the first week of installation. We’ve had Panuku suing its own council with legal fees of 1.5 million dollars to date. How come we’re paying a guy three quarters of a million dollars a year to run Watercare? Who approved that? That’s 50% more than the PM earns!

    All the while they’ve been piling on the debt, such that pre-Covid 19 we were paying 1.7 million dollars a DAY in debt servicing.

    So the first time the city faces an economic shock it doesn’t have access to the credit needed to get it through the crunch. Like I said – weak hands fold.

    Margaret Thatcher – “Socialism is OK until it runs out of other peoples money”

    • @ Andrew, Phil Goff, left leaning, surely April fools day has come early!

      As for Len Brown and his eye on his mistress rather than the city, he apparently was part of the problem with planning the mass immigration experiment in Auckland and spreading now to the provinces with ‘Auckland results’….

      “Mayor Len Brown’s Auckland is predicted to have a majority Asian, largely Chinese, population by 2040, with the existing long standing European ethnic and cultural base becoming a minority. This means that a very large percentage of Auckland’s projected 2.1 million population will have a short working history in this country with low associated tax and Kiwisaver contributions, and a rapidly escalating number of older people moving onto New Zealand Superannuation with no contribution coming from their original home countries.” https://www.scoop.co.nz/stories/PO1110/S00572/grey-power-warns-of-impact-of-high-immigration-rates.htm

      Also can we cancel the America’s cup this year as we can’t get the tourist in anyway with Covid, other countries are cancelling all their major sports events…

      Thank goodness Phil did not get his white elephant stadium going although we did have to pay some consultants 1 million dollars for their apparently redacted imputs.

      That’s democracy and transparency in Auckland City in the age of “kind face’ authoritarianism!

  4. Brilliantly put Christine Rose. I wish thousands could access your blog and read it. AFKTT lay off personal attacks on Goff and concentrate on your list of costs we don’t need, with the Cup at the top of the list.

  5. Austerity is a term National Party used when the ‘robber Johnny Key’ run his campaign of “slash and burn” and sell off what his mob did so National own that ugly word AUSTERITY.

  6. I don’t understand the surprise at all. For those of us who have had the unfortunate experience of witnessing Goff in action since the faux-leftist scumbag first began sleazing around the Princes St Branch of the Labour Party, the announcement that his council has decided to punish the poor rather than tax the wealthy, is no surprise whatsoever.
    He cannot even claim to be a neolib, given his paleolithic attitudes towards those minorities who were not sufficiently visible in his electorate for him to be able to construct a branch or a bloc. The man is an out and out tory who should have been shown the door when there were still sufficient Party members genuinely concerned about disadvantaged citizens to do so.
    I dunno if Mana are running any candidates this year since my activist days on issues other than war /imperialism are long gone, but if Mana do not field any party ticket, I shall sit this one out which will be the first time since 1972 I haven’t voted in a general election which I am able to vote in.

    Goff’s tory take on the world is unfortunately repeated throughout the contemporary Labour Party of Aotearoa, otherwise the deplorable ‘supercity’ concept would have gone the way of the dodo along with property asset ‘investment thanks to a capital gains tax. Some developer has brought a unit next to me and is currently ‘developing’ it, putting in a cardboard kitchen & bathroom, plastic carpets etc cheap cheap cheap. I spoke to the bloke, a foreigner who was tryin to grease my place outta me – fat chance. He told me what a great opportunity the units were since they were inexpensive in an area full of million $ plus properties he was aiming in that price range for his instant tat unit. He’s just finishing now. Five weeks, about 30 grand in tat replacing the somewhat old fashioned but solid joinery that had been there.
    He’s gonna pick up at least 300,000 for 5 weeks work and as long as he doesn’t piss it up against a wall, he will never be taxed on that. He said that he does about 10 of these a year round the city.

    The places were originally built for retirees, through most of this century young families bought them as ‘starter homes’ – first foot on the ladder – now they are going to be aimed at wealthier types meaning that one more place where the not wealthy could buy a usable home has been taken out of the ‘market’.
    All thanks to a weak willed government, too scared of foreign parasites to go in to bat for young kiwis.

    Phil Goff & the rest of the ersatz left are entirely to blame for this abomination, so dreaming he won’t screw the poor to help the rich is ludicrous.
    STOP VOTING LABOUR! Even if the natz get in that would be a better result because their oppressive racist & even nastier policies would force all the kiwis who have chosen to ignore their fellow citizens’ plight, to wake TF up and elect a political movement which actually did something instead of talking one way and acting the opposite.

  7. What a fucking rat. That fuck gooff has thrown many of our best young minds under a greedy, neoliberal bus by increasing university fees by 900%.
    Why is he not running while screaming?
    Hello? Rebellious youth!? Hello…? That gap toothed wonder punk is your enemy. Hello…? Anybody with metaphorical balls out there?
    Auckland? You’re in deep shit.
    ( PS. No disrespect to actual rats. )

  8. Add the water crisis, which the Council was warned of years ago. They instead want to grow, grow, grow, the population, the rates take, business and all else. Madness rules in Auckland, no matter who is governing this failed project of sprawl and waste.

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