Super City staff costs $91m a year lower
September 28th, 2010 at 11:00 am by David FarrarThe Herald reports:
The Super City will open for business on November 1 with 1223 fewer staff than the existing councils and their business units, leading to a $66.5 million cut in the annual wage bill.
The agency designing the Super City has trimmed staff numbers from 9430 staff a year ago to 8207. …
The agency said staff numbers would drop by another 300 when people employed to bed down the Super City completed their work by July 2012.
This would lead to a $91 million overall reduction in the wages bill to $513 million by mid-2012.
This is good news for Auckland ratepayers. Obviously not great for those losing their jobs, but reducing costs on ratepayers will lead to greater economic growth and more jobs in the private sector.
The chances of cost savings from fewer staff leading to lower rates appear remote.
None of the main Super City mayoral candidates or political tickets are promising lower rates from the savings and efficiencies expected from the reforms.
As well, setting up the Super City has cost $200 million, which will be borne by ratepayers.
Which is around the first three years of lower staff costs only. After that rates should be lower than what they would have been under eight different Councils.
Tags: Auckland Council
September 28th, 2010 at 11:08 am
Won’t they just follow Parkenson’s Law and find more ways to spend the money saved?
Vote:September 28th, 2010 at 11:18 am
This is great news. There are few people more worthy of getting fired in NZ today than the thousands of little Hitlers and Maos who exist in local government, an organ of democracy that has of late been converted to tyrannical objectives by council employees who seem intent on hounding those who pay their wages with intolerable cost increases and burdensome regulation. I hope this is just the start and we see thousands of these puffed up self important leeching bureaucratic bastards joining the dole queue.
“None of the main Super City mayoral candidates or political tickets are promising lower rates from the savings and efficiencies expected from the reforms.”
Of course not. Morons though will still vote for them.
Vote:September 28th, 2010 at 11:24 am
“After that rates should be lower than what they would have been under eight different Councils.”
Yeah right.
Are there any forecasts in rating income for the super council? Dont expect the Herald to have done any checking.
Vote:September 28th, 2010 at 11:26 am
“This is great news”
Sorry the news is they will just outsource the work. It will cost more than $91 million.
Vote:September 28th, 2010 at 11:29 am
That’s what Max said.
Vote:September 28th, 2010 at 11:33 am
Too right RB.
Unofrtunately I fear that the grandiosity of the Super City is attracting too many huge egos. This is exactly the opposite of what you want in local government. Instead of sticking to roads, drains, and sewage, rates are going to be thrown left right and centre at “sustainability”, “affordable housing”, “world-class transport” etc…
And Hide tells us our rates will reduce….. yea fucking right.
Did I read correctly the other day that NZ has somewhere in the region of 90 councils and local regional authorities? In a country outr size? FFS
Vote:September 28th, 2010 at 11:36 am
Why can’t NZ be divided up into 10 or so provinces, with one council for each. E.g Northland, North Harbour, Auckland, Waikato, Taranaki, Manawatu Wellington etc etc. Instead of this situation where someone can be the “Mayor of Otorohonga”. Are you kidding me?
Vote:September 28th, 2010 at 11:37 am
Sadly too many of the drones who have been eating the honey and producing nothing of value to society will struggle to find a job in that expanding private sector and will just transfer to a slightly less expensive place on the welfare roll.
Vote:Question, why do all candidates for local government include in their proposed , a pledge to reduce rates and then rates go up year on year with no relevance to inflation.
At least the commissioners appointed to resolve the shambles that was Ecan took an axe to the proposed rate increase.
Knitting is so much cheaper than the rubbish that all elected representatives seem to become enmeshed in once the trough is placed before them. The pity is that sticking to the “knitting” of local government is not what the flotsam that succeed at the polls ever intended, just that they do not mention it as candidates.
September 28th, 2010 at 11:37 am
The Romans could have run a city that size with one gov and six staff.
They wouldn’t have taken any crap either.
Happy days.
Vote:September 28th, 2010 at 11:41 am
There is a town in Tasmania called Brighton where all rates are the same. Not based on property valuations but fixed by the simple calculation of dividing the cost of council by the number of ratepayers.
This is a step in the right direction, but the real solution lies in taking the cost off property owners and putting it on the users. A poll tax is the only fair and realistic solution to funding councils.
Vote:September 28th, 2010 at 11:44 am
“Sorry the news is they will just outsource the work. It will cost more than $91 million.”
Oh look, yet another commie propagandist drops in to try and prop up his flagging political situation.
Vote:September 28th, 2010 at 11:45 am
“After that rates should be lower than what they would have been under eight different Councils.”
What utter b/s. You are conveniently forgetting all the other set-up costs e.g. the huge SAP IT contract that was recently announced – we’ll be paying the interest on the money to fund that for years to come.
Vote:September 28th, 2010 at 11:59 am
“we’ll be paying the interest on the money to fund that for years to come.”
Wow, a commie who cares about the amount of tax people pay.
Give it up loser, you don’t give a damn.
Vote:September 28th, 2010 at 12:02 pm
I believe Hide has done a great job under the circumstances. He has run a party, an electorate and ministerial porfolios while reorganising Auckland. What other public figure is doing near that level of work. And yes Auckland it is going to cost money initially, but far less than had we allowed it to continue the way it was. There is no magic bullet-dismantling the petty bureaucracy that has crept into every aspect of our lives in Nexw Zealand is going to be incredibly hard given the various vested interests. However it must be done-good on you Rodney!
Vote:September 28th, 2010 at 12:14 pm
As hard as dismantling petty bureaucracy creep is trying to limit mega bureaucracy bulge.
NZ already went through a phase of amalgamating boroughs, counties, towns and cities a while ago so they should be operating more efficiently and cost effectively. What if the Super City swells? Combine it with Hamilton?
It’s far too soon to tell how successful the grand Auckland will be.
Vote:September 28th, 2010 at 12:18 pm
# Redbaiter (11,588) Says:
September 28th, 2010 at 11:41 am
A poll tax is the only fair and realistic solution to funding councils.
Wrong again.
A poll tax (where everyone pays the same no matter what they use) is the ultimate in communist solutions.
A user-pays system is the only fair solution, a user pays/poll tax system the only realistic one.
Vote:September 28th, 2010 at 12:21 pm
Moron. Fees are charged for services.
Vote:September 28th, 2010 at 12:25 pm
I’d wait to see how Auckland goes before following the model elsewhere.
In theory there are efficiencies. In reality, the larger an entity gets the further it gets from ratepayers. Arguably smaller would be much better – when it’s your neighbours paying the rates, and only your local park that needs cleaning, you might find more volunteer work and less workforce. And more respect for the amenities provided – since again your neighbours have to clean up whatever mess you or your kids make.
Downside is that you can’t then deliver welfare through local councils – poor areas end up with poor facilities. Arguably welfare isn’t a function of local councils anyway, so it isn’t clear to me that this is a problem. There could also be a problem with large regional assets – although maybe the national govt could own them, or maybe regional councils.
Vote:September 28th, 2010 at 12:27 pm
Pete George “It’s far too soon to tell how successful the grand Auckland will be.”
My point was the way we have been doing things obviously isn’t working well. Give the new venture a chance. Obviously there is risk in everything. But if one at least starts from sound core principles the chances of succeeding are much higher.
Vote:September 28th, 2010 at 12:30 pm
Like any cost-cutting ‘solution’, costs will no doubt rise again almost as soon as the restructuring has been completed… However, $91million is a large saving, and there is scope within that for a large amount of economic creep that will accrue over the next few years. If this comes about as forecast, whilst local issues are dealt with effectively, then hats-off to Rodney for implementing one of the boldest and most radical plans that will affect a huge proportion of NZers. If on the other hand, this turns out to have not been properly costed (versus benefits etc), and is nothing more than a large and potentially disastrous experiment – then surely this will kill him off in a manner that his hypocrisy (and dancing abilities) has not yet managed to achieve.
I really hope for the former.
Vote:September 28th, 2010 at 12:31 pm
I am sure Red Len (looks likely winner) will find new and inventive left wing ways to piss the money away and tax us for more
Vote:September 28th, 2010 at 12:32 pm
the Canadian experience is pretty instructive. They went through super-city amalgamations in the 1980s and 1990s on the promise of efficiency gains saving ratepayers money. City spending massively increased in all cases, IIRC. Tiebout explains why: without competitive tension between cities to deliver an efficient mix of taxes and services, an important check on spending was eliminated by amalgamation and both taxes and spending ballooned.
Vote:September 28th, 2010 at 12:34 pm
When I first heard this $91m savings number, my first thought was “what does this mean per house-hold” (ie. per rates bill) I had no way of figuring out how significant it was compared to the total budget…
I’m surprised this question wasnt so obvious that some reporter didnt do it for me…
but here its is…
Greater Auckland population 1.4m
if you assume an average of 4 bodies per house-hold (I have no clue how accurate that is, I pulled it out of my ass) thats 350,000 house-holds. (no idea how many business premises)
So, a saving of approx $260 per house-hold…. thats actually pretty significant!
(anyone who can correct my assumptions with more accurate figures is welcome)
Now, if thats a cut in my rates… yippee… but if some of it gets spent on new things I dont mind… as long as they do actually make the place better, not just get wasted on crap…
Vote:September 28th, 2010 at 12:46 pm
I’d like to see councils per-property rates growth limited to CPI and have their borrowings (the service of which is really just future rates spending) restricted to a % of their annual revenues. Then remove their ‘social services’ remit and get them working to provide better quality essential public services.
Much as I like the idea of super citys delivering benefits, I can’t see them being realised without something of a renaissance of the primary roles of councils.
Vote:September 28th, 2010 at 1:06 pm
What’s your basis for comparison? How many should a “country our size” have?
For instance, Ireland has 29 county councils, 5 city councils, and 80 town councils. Norway has 19 counties, divided into 430 municipalities.
Vote:September 28th, 2010 at 1:20 pm
Something doesn’t seem right
$66.5mil saved by trimming 1223 staff = approx $54k per person
Mid 2012 the wage bill will have dropped to $513mil with (8207-300) 7907 staff = avg sal of $65k
So we have fewer of them but we pay them 20% extra
Especially as most of those dropped were apparently middle management – I’d expect the avg sal of those dropped to be greater than the total future avg salary.
Vote:September 28th, 2010 at 1:49 pm
Here is how these savings might be bedded in. First, rates have to be capped to the rate of inflation. Then councils have to be banned from doing “welfare”. Then they have to have “competence” removed. Next they have to be made to stick to rubbish, drains, roads, and parks. Their roading and maintainence services need to be privatised. The work needs to be put out to tender. Rodneys main task for the next three years. The biggest obstacle to this happening is National not having the guts or imagination to do it.
Meanwhile watch the savings evaporate if Len Brown wins the Auckland mayoralty.
cheers
David Prosser
Vote:September 28th, 2010 at 4:58 pm
Typical right wing lack of compassion for the 1200 people and their families shafted by that bouncing dwarf hide and his band of prevaricating ideologues. Easy for Hide to cut the rug from under hard working mums and dads while bounces around the world on his blondes at the taxpayers expense. Disgusting.
Vote:September 28th, 2010 at 5:01 pm
Have just posted my vote off for Len & a selection of left wing candidates. Would normally have voted right but the right wing NZ blogs have carried out a deeply offensive smear campaign against the left including Whaleoils horrid Anderton earthquake quote.
Vote:September 28th, 2010 at 5:09 pm
@John Gibson – Governments, local or national, do not exist to provide jobs. They provide services to rate and tax payers, and they should employ the optimum number of people to this end. Every dollar they spend unnecessarily on employment removes money and jobs from elsewhere in the economy. If you want large, fat government with plump jobs for everyone then head to Greece.
Vote:September 28th, 2010 at 5:14 pm
“would normally have voted right”
A lie.
Vote:September 28th, 2010 at 7:28 pm
Poor John, have read some dribble over the years but yours has to be in the top ten of idiot comments. ” I voted left because they say nasty things about the left on right wing blogs.” Perhaps they say offensive things about the left because the left are simply two bobs, something you may like to consider. Anyhow I fail to see how right wing blogs smear the bloody left, the left seem to be experts at smearing themselves without any help from third parties.
Vote:September 28th, 2010 at 10:57 pm
John, really? We should not reduce cost in the public sector, because people might lose their jobs? When did people have a right to useless jobs?
Vote:September 30th, 2010 at 7:32 pm
If you really beleive the Super City will deliver lower rates thoguh cost savings you beleive in the tooth fairy. The super city has shambles writen all over it.
Brown will win the Mayoralty, without party disiplines providing some form of structure around volting getting any from of consnesus past the personal interests of the councilors will be like hearding cats.
They should have taken infrastructure management up into a stronger regional council format and let city councils get on with local not city wide issues.
Vote: