Asset sales not ruled out

Syd Brown
Syd Brown
Dunedin city councillors are divided over the merits of delaying multimillion-dollar capital projects to ease the pressure on ratepayers, but might consider more controversial steps.

Councillors will this week begin hammering out the Dunedin City Council's 2011-12 pre-draft annual plan, which forecasts a rates rise of 6.1% for the coming financial year, followed by an 8.9% increase in 2012-13.

It is a rates hump that has both Mayor Dave Cull and Cr Syd Brown - chairman of the council's new finance, strategy and development committee - looking for further savings.

However, a suggestion by Cr Brown that delaying big-ticket projects could help trim costs drew both criticism and support yesterday, with councillors appearing split over the idea.

Some agreed every capital project should be reconsidered by the new council, while others argued delays would be pointless and potentially costly, or were non-committal, saying only they would consider the merits of any specific proposals.

However, calls for the size of the council's staff and also its operating costs to be scrutinised again, and a proposal to debate selling council-owned assets such as CitiBus, will also be discussed.

Cr Kate Wilson said she would raise asset sales during this week's deliberations, which would include a private workshop on Wednesday and a two-day annual plan hearing beginning on Thursday.

Deferring capital projects was not the only way to achieve such savings when council-owned companies also aimed to provide dividends to offset rates, she said.

"If they [the assets] are to reduce rates, then selling them maybe is an equally valid way of doing that.

"I'm not advocating for that - I'm advocating for the discussion... I think we need to look at absolutely every way we can make savings."

Cr Richard Thomson's attention was on council operating expenditure, even after council chief executive Jim Harland's drive to trim $6 million from costs identified $4 million in potential savings.

Cr Thomson said many of the savings appeared to come from cutting grants, services or other council "outputs", rather than addressing the council's core operating costs, which required "a harder degree of assessment than has perhaps occurred to date".

"It always worries me when the suggestions for savings are around reductions of services, rather than looking at what is the cost of providing those services and can we do that more efficiently? You've got to be convinced that management has done that analysis.

Cr Thomson found support from Cr Lee Vandervis, who argued the council's staff size and spending on consultants was "a fundamental problem". Deferring capital projects would be "an absolutely weak-kneed, useless response" and proposed minor cuts to service levels - such as reducing library hours - amounted to "tinkering around the edges".

Cr Bill Acklin spoke out against deferring projects, particularly those already under way, saying the focus should be on improving Dunedin, encouraging more people to live in the city and helping it grow.

"That's the only way I think we're going to find a better balance between what we pay in our rates and having the right sort of facilities within the city."

Cr John Bezett said the case for delays would depend on the savings that could be realised, but the council also had an obligation to proceed with projects it had committed to - or consult the public if major changes were considered.

Cr Neil Collins supported delays, saying projects like the harbourside plan change and Caversham tunnel cycleway should be put off.

"It's not something I think we can do at this time. It'll have its time, but not now."

Cr Jinty MacTavish said some projects should be delayed until at least next year, when the big picture could be considered as part of the council's long-term council community plan (LTCCP). The projects could then be judged against those likely to emerge from planning work on climate change and the Your City, Our Future project, she said.

"Given the financial situation we are in - and the world is in - we need to be looking at those and looking at priorities."

Cr Thomson would consider delaying individual projects, such as the Logan Park upgrade, but not projects like the Town Hall upgrade, which would provide additional revenue.

Cr Paul Hudson said some projects - such as the Otago Settlers Museum upgrade - involved outside funding.

"You have to be very careful that you actually keep faith to the people who have made commitments to you."

Wednesday: Councillors' pre-draft annual plan workshop.
Thursday-Friday: Public pre-draft annual plan meeting for debate and decisions (resuming January 31 if required).
May 4-6: Public hearings (three days).
May 11-12: Annual plan deliberations.
June 7: Council considers annual plan recommendations.
June 27: Council adopts annual plan; confirms rates for 2011-12.




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