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Monday
May152017

Financial Results to 31 March 2017

The following is an overview of the budget revision outcome:

Readers will note that the most significant figure revealed in this table relates to Property Re-valuation – up from a budgeted $38m to $58m. This figure has increased year on year for some considerable time and reflects mainly increases in land values. Note that although this is hardly a cash item, it is significant inasmuch as it shows the performance of the Council in a far more favourable light that would otherwise be the case.

I commented on falsity of this net effect during the Leach years – he often made quite false claims about performance without apparently being fully cognizant of the actual situation of the Council. In this case the annual increase over budget for the 12 month period is $30m, or 110% - hardly good budgeting, when a total surplus of $30m over budget is disclosed.  

Other notable changes include $439k increase in fees and charges, balanced by a decrease in development contributions of $465. Clearly many developments have been postponed.

It appear that the famous Great Walks and Coromandel Harbour Projects have also been postponed – cancellation would better news, but at least they are off for another year while they sort out what they are going to do.

Personnel costs are down by $290k because of difficulty being experienced in filling positions.

Storm Damage is understandably up by $490k, and a further $415k allocated for 2017/18. Expect more to be necessary following more recent damage.

The only other significant figure previously undisclosed, is the $700k allocated for the Thames Indoor Sports Centre bringing the total budgeted cost to $4,847m. But this is still subject to finalisation of the negotiation with the builder. One can only hope that they have a decent handle on this, but I suspect not. Beware the brouhaha smokescreen as we approach the opening date.

Annual Plan 2017/18 - Update

Based on the March budget revision above and recent discussions with Council on the Annual Plan for 2017/18 the projected average rate increase is forecast to be 3.38%. Movements by individual Community Board Area are listed in the following table:

Community Board area

Local CB rates only

District plus CB area rates

Thames

9.88%

4.55%

Coromandel-Colville

-1.90%

1.61%

Mercury Bay

10.12%

4.22%

Tairua/Pauanui

1.28%

2.30%

Whangamata

1.53%

2.41%

 

In addition Councils external borrowings are forecast to rise from $40.7million to $47.3million over the 2017/18 financial year.

 

 

 

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