In this recent NZ Herald article, Rodney Hide cited some of the remarkable fiscal results so far from local government reorganisation in Auckland.
The numbers he cites are from Auckland’s new Long Term Plan (4.5MB).
In 2009 when the transition began, there were 10,000 staff across the eight councils; there are now 8000 … a reduction of 20%. Says Hide: “The cut was not from front-line staff and service delivery but to management as duplication was eliminated in establishing the one council.” Hide claims the savings total $94 million in wages alone each year … or about $1 billion in savings over 10 years.
In his Auckland LTP message, chief executive Doug McKay reports:
“We are delivering on the promise of amalgamation and the $81 million in cost savings we produced in the first full year of Auckland Council are just the beginning. A further $50 million in costs will come out during the first year of the LTP (2012/2013). These savings are material; every $14 million we manage to reduce in costs is the equivalent of a 1% rates reduction.”
And from Auckland’s 2012-2022 LTP:
“The council has an efficiency programme to leverage savings from the amalgamation and build a culture of value for money. The programme has been successful in identifying ongoing efficiency gains and other cost savings of $81 million from 2011/2012; permanently reducing the general rates requirement by this amount.
… the council is forecasting that over the next six years a further $107.2 million of permanent ongoing savings will be realised, so that total savings of $188.2 million per annum will be achieved by 2017/2018. These savings are projected to accumulate to $1.7 billion over the full 10-year period of this plan.
In general, these savings represent the reduced cost of delivering the same service levels planned by the legacy councils. The savings will primarily come from improved procurement practices, process automation, system rationalisation, resource optimisation and enhanced commercial management.”
Says Mayor Len Brown, in his LTP message: “We have found $1.7 billion in cumulative savings and efficiencies within the LTP while maintaining council service levels.”
McKay notes that the average rate increase across Auckland for the past eight years was 5.7%, while the new LTP holds the average rates increase to 3.6% in the first year and no more than 4.9% in subsequent years.
At the same time Rodney Hide credits Brown with doubling public capital investment in Auckland infrastructure, from $1 billion to $2 billion per year.
Hide sums it up simply: “The Auckland Council is doing more with less.”
“Doing More With Less” … not a bad aspiration for amalgamation in Hawke’s Bay.