26 Apr 2023

Auckland Council airport shares still on chopping block to fill $295m budget hole

4:31 pm on 26 April 2023
Auckland mayor Wayne Brown visits the Mangere Emergency Centre following the Auckland floods on Friday, 27 January to see how they are supporting victims.

Auckland Mayor Wayne Brown. Photo: RNZ/Angus Dreaver

Aucklanders want the council to sell at least some of its Auckland Airport shares, new data shows.

Auckland councillors met on Wednesday morning where they discussed the public consultation findings about the 2023/24 Annual Budget.

In a media release, Mayor Wayne Brown said Aucklanders were encouraged to have their say on key proposals - and how to fill a $295 million budget hole - and they did so in "record numbers".

"The most of any public consultation in Auckland Council's history," Brown said.

Brown urged the city's 20 councillors to keep an open mind about the available options.

He said he still planned to sell the council's airport shares, but would reassess his proposed cuts in arts and social services.

Brown said his decision-making was based on the more than 40,000 public submissions, as well as an independent survey of almost 4000 people. The results suggested 55 percent wanted to sell at least some of the council's airport shares, with 76 percent supporting the move in the survey.

"The results show that there is public support for the key elements of the budget proposal, including using a balance of spending cuts, sale of airport shares, rates and debt to cover the $295m hole."

"We will listen to what Aucklanders have told us, and balance that with the correct mix of different levers for this budget. By putting a number of options on the table, my budget proposal provided us with the flexibility to genuinely take into account public input."

Brown said councillors needed to remember bigger bills were on the way - and the combined cost of Auckland's flood recovery and over-runs from City Rail Link was likely to be about $1.7 billion.

"Events like these provide a timely reminder that we need sufficient debt headroom to deal with unforeseen shocks.

"We cannot in good conscience rely on increased borrowing to cover annual budget shortfalls each year. Now, more than ever, we have got to be prudent and make financially sustainable choices."

Desley Simpson Photo: RNZ / Dan Cook

Deputy Mayor Desley Simpson told Checkpoint the three different methods of consultation resulted in different views ranging from full to partial sale of the Auckland Airport shares, for example.

She said cuts in one area would mean more leeway in another.

That was why views on the controversial sale of the shares could not be viewed in isolation and must be regarded as part of the full package.

"If you have the money from the airport sale of those shares you have a little bit more money to play around with not cutting so much.

"So it is a bit of a trade-off but to trade something you've got to have some money in the bank so to speak.

"It is a very complicated matrix that councillors and staff are helping us put together to understand exactly where we'll actually end up with the final budget."

Brown's proposal on the budget will be finalised on 31 May, with all budget decisions to be made on 8 June.

They will then be adopted on 29 June.

Other feedback from Aucklanders included:

  • Most participants believe there needs to be spending cuts (submissions: 51 percent / survey: 80 percent), but opinion differs on the extent of the cuts (with the majority preferring some, rather than all, of the possible spending cuts)
  • The proposed mix of rates and debt (rates increase of 4.66 percent and borrowing of up to $75 million) was the most popular of the options canvassed (submissions: 25 percent / survey: 35 percent)
  • There was also public support for the Future Storms proposal (submissions: 69 percent / survey: 40 percent), which would see an additional $20 million each year in funding to prepare for and respond to severe weather events

Waitakere Councillor Shane Henderson said he and his colleagues were making slow but steady progress on resolving the budget gap.

He was sure the submissions would have changed a few of the councillors' minds.

"We're still in the middle of discussing [them] but I'm sure it will have changed plenty of them because we go through these submissions very carefully. We'll be reading them very carefully and then discussing them with the council.

"So the feedback that's been given is incredibly helpful for the future of Auckland."

It was clear Aucklanders were concerned about possible cuts to libraries, parks, arts and social services and the council was trying to find a solution they could all live with, he said.

Relief community funding might stay

A community group has welcomed the news that proposed funding cuts may be revised.

Migrant Action Trust manager Amie Maga said Auckland Council funding helped 100 of the 500 people a year it supported with language tuition, driving lessons and job search advice.

Language tuition was helping New Zealand businesses to fill worker shortages, and funding would mean it could continue.

"We have around 60 volunteers per year helping our different programmes, especially the driving programme and one on one job search help," Maga said.

"With Auckland Council grants and other funding opportunities, we would like to carry on our mission to help migrants to attain their goals, not only for their families, but to the wider community and contribute positively. Given the massive shortage in healthcare, hospitality and other industries, we need to help our immigrants so they can also contribute to Aotearoa."

The trust will mark its 20th anniversary this year.

"It's a big celebration, and hopefully we get more support to serve and help our communities for another 20 years. Every dollar counts."

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