AUCKLAND COUNCIL CEO RELEASE STATUTORY PRE-ELECTION REPORT
Auckland Council's ten year long term plan reveals some very sobering figures for its proposed future debt levels.
The Council's proposed enormous capital expenditures will deliver debt at its peak that will approach $18,000,000,000 (yes $18 Billion!). At this point Auckland's debt will account for over 50% of total New Zealand local government sector debt, (around half! of all the debt of our 79 Councils)... for a largely urban area with less than one third of our National population total.
At the current 2013-2014 more "modest" debt total of almost $6 billion, in round figures the Council's daily payment of debt servicing interest costs, at an average interest rate of 5.75% works out at $1 million per day, (yes per Day!).
Now that is a lot of money in anybodies terms, but it gets worse. At this level, interest payments represent 1 in every 5 dollars of all Auckland Council's rates revenues.
Councils fundamentally are little different from households in basic financial prudential terms. Would you run your personal financial affairs on a plan comparable with that Auckland has opted for? We at NAG ... think not.
Our Northern Rodney Unitary Council wants nothing to do with the Auckland Council's debt laden plans which will fund capital projects from which our District will scarcely benefit.
Our proposed NRUC Council will run debt policies that are needs-based and are affordable. They will be both prudent and sustainable ... just like any "well managed" household.