Alternative to Auckland Council’s grim budget doesn’t ‘gut’ services

An alternative budget for Auckland Council has been floated which, authors say, would avoid the deep cuts to community spending proposed by mayor Wayne Brown.

“A Better Budget” is promoting a mix of higher rates and borrowing to meet Brown’s initial aim of closing a forecast deficit of $295 million in the coming year.

“Our plan shows a better budget is possible, which gets Auckland Council back on track without gutting community services or selling off the airport [shareholding],” said climate activist India Logan-Riley.

The group members have backgrounds in climate justice, economic policy and community organising and hope to lobby councillors and seek support during public consultation on the budget up to March 28.

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A key difference is dropping Brown’s proposal to temporarily reduce two targeted rates – cuts which take a proposed 7% average residential rate rise down to 4.66%.

The alternative group said retaining the Water Quality and Natural Environment Targeted rates in full would bring in more than $50m and help avoid the need for community cuts.

Every 1% rise in rates brings in $20m of revenue, and would cost the owner of an average value Auckland home an extra 60 cents a week – a bit over $30 a year.

A Better Budget said instead of the mayoral proposal to increase borrowing by $140m, they believed the council had capacity to borrow more, up to $150.9m, which it argued would also avert the need to sell some or all of the council’s 18% stake in Auckland International Airport.

Selling the airport shares has been a step too far for previous councils, but Brown has pointed to the ending of dividend income during the Covid-19 border closures, and the savings that could be made by cashing up and reducing debt and the associated interest cost.

Council officials believe $48m could be saved in the coming year, if the $1.9b worth of shares were sold – a possible $40m dividend lost, but an $88m in borrowing costs achieved.

The alternative budget does not lay out numbers around retaining the airport shareholding, but the combination of its proposals does arrive at a $295m figures to eliminate the forecast deficit.

Auckland Council’s budget hole is the biggest in its 12-year history, with global high inflation and interest rates fuelling a smaller deficit which was foreseen a year ago.

The mayor’s proposal includes deep cuts to council agencies, community programmes, social and economic support in the south and west and significantly raising the cost of hiring facilities.

Both the budget challenge – and the degree of opposition to it – are unprecedented, with Auckland Central MP Chlöe Swarbrick promoting a petition, and the Green Party she represents circulating information on how to make submissions.

The budget is partway through formal public consultation, and from April to the end of June councillors will debate what changes should be made.

A Better Budget believes that while its numbers stack up, the exercise is also important to show there are different ways to solve the council’s fiscal problems.

In addition to Logan-Riley, the group includes Craig Renney, the economist and director of policy with the Council of Trade Unions, and community development specialist Cissy Rock.