New Dunedin councillors have got straight into their work.
The first meeting of the Dunedin City Council since last month’s election was primarily ceremonial, as the new council was sworn in, but there was also an important item of business on Friday’s agenda — adopting the annual report.
New councillor John Chambers asked for an explanation about the difference between budgeted capital costs of $207 million for the 2024-25 financial year and the actual spend of $148m — a $59m variance.
He asked if there were financial consequences for the new council.
Chief financial officer Carolyn Allan referred to a series of project timing delays.
An example was in waste management, for which the budget was $25m and the actual spend $6m. Ms Allan said purchase of equipment was delayed because of consents.
The council’s 2025-34 long-term plan adopted in June picked up on delays and factored them into budgets, she said.
New councillor Russell Lund asked about property, plant and equipment revaluations increasing by more than $340m, when the increase the previous year was $29m.
Ms Allan said property was revalued every three years and water assets every year.
Three Waters, property and urban development general manager David Ward said Three Waters construction costs had increased significantly in recent times.
Cr Lund also asked about a fall in satisfaction by users of Moana Pool.
Former mayor Jules Radich, now a councillor, said he was a regular user of the pool and construction activity had resulted in some disruption and dissatisfaction.
New councillor Andrew Simms raised concerns about interest costs as a percentage of rates revenue increasing from 4.9% in 2021 to 11.3% in 2025 and being set to increase further.
Ms Allan said this was projected to reach 15% by 2030 and then reduce.
In his speech, Cr Simms said the council’s first meeting was celebratory, but he took no comfort or solace from reading the annual report.
"We have developments being held up for lack of infrastructure, particularly water infrastructure, yet we have $50m under-delivery of capital services for the year," he said.
"Reading this annual report explains why the shareholders of Dunedin city ... voted for change in 2025."
Deputy mayor Cherry Lucas said it was unusual for the council to adopt the annual report at its inaugural meeting for the term.
It did so to meet a statutory deadline of October 31.
Cr Lucas noted there was an unqualified audit.
Returning councillor Lee Vandervis voted against approving the annual report, although he voted for adopting it.
It was an accurate summary of the past year’s work, but there was much to be concerned about, he said.
The trajectory of debt and rates increases was unsustainable, he said.
"I don’t approve of the spending that has been done, in general."
It was the second time in a row the council adopted its annual report at the 11th hour.
Annual report key points
Deficit after tax of $733,000, compared with budgeted deficit exceeding $28.5 million.
Delivery of capital costs was $148m, compared with the budgeted $207m.
Loan balance increased from about $590m to almost $651m (against the budgeted $709m).
Annual report achieved an unqualified audit.
Revamped kerbside collection of rubbish and recycling started on July 1, 2024.
A state of emergency was declared in October 2024 after heavy rain.
The council’s S&P Global credit rating was downgraded from AA to AA-.
