Auckland Council facing reality

July 8th, 2014 at 11:00 am by David Farrar

The Herald reports:

Cutting back funding for park maintenance, reducing library hours and scrapping inorganic rubbish collections are among options being considered by a cash-strapped .

Its finances have reached crisis point where severe cuts are necessary in a black budget to put rates and debt back on an “affordable” and “sustainable” path. But families fear the proposals will leave the city’s youngsters worse off.

To rescue finances, slashing up to $2.8 billion of new spending is required, as well as stripping up to $486 million a year for each of the next 10 years.

The first overview of the new 10-year budget discussed by Mayor Len Brown, councillors and decision makers yesterday included the $2.86 billion City Rail Link, which has an enormous flow-on effect.

The more you spend on one item, the less you have elsewhere. It is elementary.

“We’ve been looking at a situation where on one hand we’ve got this ambitious programme but on the other hand we’ve got this constrained funding envelope.”

Welcome to fiscal reality.

The council has also identified parks and community services for cuts of up to $60 million a year with talk of closing “under utilised” halls, recreation centres and swimming pools. Fewer arts and culture festivals and events are under consideration.

The proposed cuts are on a scale never witnessed in Auckland before, and are certainly bigger than those of Auckland City Mayor John Banks’ razor gang of 2001, headed by former Finance Minister Sir William Birch.

Ratepayers should not be used as a never-ending source of increased revenue. Rates increases should be no more than inflation.

Under his first four budgets – based on the budgets and assumptions of the former councils – debt soared from $3.9 billion to $7.3 billion and households were hit with cumulative rates increases of up to 38 per cent.

The more debt you have, the greater the interest payments are.

Mr Brown has not ruled out breaking a key election promise to hold rates to no more than 2.5 per cent this term.

It will be his final term if he does. He may of course realise he won’t be re-elected regardless, so decide he has nothing to lose by breaking his promise.

However Councillors who vote for higher rates increases may face a challenge with re-election if they do.

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51 Responses to “Auckland Council facing reality”

  1. notrotsky (86 comments) says:

    The dishonourable mayor brown is widely deposed and ridiculed in Auckland a battery hen could run against him at present and become our new mayor.

    There are very few of us in Auckland that don’t look back fondly to the days where we had separate councils rather than the behemoth we currently suffer under with the never ending rises in rates and services such as water, Rodney hide should be rightly pilloried for this debacle he foisted upon us.

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  2. duggledog (1,625 comments) says:

    Sell POAL for a start. Auckland Council wouldn’t be in this mess if local government voting was restricted to those who own property, and Helen Clark hadn’t introduced the Local Govt Act which allowed local governments up and down the country to do whatever the hell they want

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  3. rangitoto (264 comments) says:

    They should be looking at a major cutback on the Head Office bureaucracy, not basic services. They could fire half of their HO staff at least.

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  4. mister nui (1,030 comments) says:

    Auckland Council facing reality

    No they’re fucking not.

    All the social activities, such as the arts, have missed the scalpel. Oh that’s right, all the luvvies are Len’s biggest fans – can’t touch what is sacrosanct to the luvvies.

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  5. Nigel Kearney (1,097 comments) says:

    I hope they don’t cut the libraries. It’s one of the few non core government functions that is really useful. Though half the people in there are just taking out DVDs now so they can definitely lose that if it’s costing ratepayer money.

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  6. mjw (401 comments) says:

    Fiscal reality applies to National’s economic policies too. Two thirds of GDP growth over their time in office can be attributed to their extra $50 Billion of government borrowing. If you take that out, their real GDP growth record is abysmal – at about 1% per year on average. And that isn’t even correcting for the Chch insurance payouts.

    This claim of a rock start economy is smoke and mirrors. It’s debt growth and insurance payouts, not real growth.

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  7. Adolf Fiinkensein (2,704 comments) says:

    rangitoto

    Yes indeed. What the hell do they do with 6,000 staff?

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  8. igm (1,413 comments) says:

    Suppose Campbell Live will come out and attempt to exonerate the bastard again!

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  9. Unity (641 comments) says:

    What a ridiculous idea to cut libraries etc. What they should do is what Rangitoto said and reduce Head Office bureaucracy, starting with all the racist nonsense. They even have a department for Climate Change I believe. Nothing they do will change the climate which happens all by itself, so they could get rid of all of them. The racist Statutory Board (or whatever it is called) and everything to do with it, could go – it’s totally unnecessary. Yes, many social and arty activities could go and they could just stick to the core necessities. What a saving to start with!!

    Len Brown is an utter disgrace allowing Head Office bureaucracy to expand to such diverse heights. We should set Auckland up as an excellent example as to why so many Councils should not be totally merged. Separate Councils could go in together on major projects that overlapped, but oversee their own local activities.

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  10. ciaron (1,448 comments) says:

    It’s times like this, that I miss living in Auckland a whole lot less…

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  11. Redbaiter (10,436 comments) says:

    I don’t see how anyone can apply this quite valid criticism to Auckland council but not apply it to central govt which is committing all of the same extravagances.

    Is it because one is Labour and the other is National?

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  12. alloytoo (582 comments) says:

    We can expect Len to protect the Choo Choo at the expense of everything else, primarily because he expects the Choo Choo to pull up his pants, something he should have done himself years ago.

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  13. rangitoto (264 comments) says:

    English always had a realistic plan to get the govt accounts into better shape. ACC plan was spend until they caused a crisis

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  14. Other_Andy (2,676 comments) says:

    “Fewer arts and culture festivals and events are under consideration.”

    What do you mean under consideration?
    Brown playing his fiddle while Auckland burns?

    What about (for starters):

    1. No arts and culture festivals and events.
    2. Abolish the Māori Statutory Board.
    3. Sell off POA and Auckland Airport shares.
    4. Cut 50 % of staff

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  15. Unity (641 comments) says:

    Yes, Redbaiter, there is waste and extravagance everywhere but Council’s need to tighten up and just administer the core local services basically. Auckland Council covers far too wide an area and was a huge mistake in the first place. I can accept local Councils meeting certain overlapping costs together but basically we need to retain local Councils who will look after their own area. Auckland has proved that huge Councils don’t work.

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  16. ldypen (42 comments) says:

    Not that hard is it.. lets get rid of these then:

    1. All the spin Doctors (sorry Lenny you’ll have to make your own crap up)
    2. Swimming pools (sell them and let the private sector run them)
    3. No parades (gay, santa or any other)
    4. No cultural crap (If the “cultures” want them then THEY can organise and pay for them NOT ME!)
    5. No more re-design of Auckland Council Logo every few years at ridiculous prices (no one cares what the logo is anyway!)
    6. No junkets to visit sister cities all over the world
    7 etc etc etc!
    8. Stop paying for anything to do with the ARTS
    9. Stop paying for any un-elected entities
    10. Sell all the shares (you could use the CASH Len)

    Stick to:

    1. Clean the streets
    2. Supply drinking water
    3. Mow the grass
    4. Keep street lights working
    5. Fix the pot holes!

    Sorry Other_Andy … you beat me to it!

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  17. mjwilknz (605 comments) says:

    Sounds like an excellent reason for getting rid of the annual eye sore that is inorganic rubbish collection. Come on, Aucklanders, time to take more pride in your city.

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  18. mikemikemikemike (334 comments) says:

    Ditch the train set for a few years, get debt under control and then look at it. The rates have gone up massively since this wonderful super city was forced on us (Thanks National/ACT) with a reduction in overall services and an even bigger bureaucracy to deal with. Amazing that if I call for a traffic warden to tow a car parked illegally they arrive in half an hour, but noise control takes over 2 hrs to arrive.

    oh and get rid of Len Brown….

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  19. 2boyz (273 comments) says:

    Has the ‘Super City’ been a successful experiment, hard to say with these amazing cost blowouts. can I see it happening elsewhere (Wellington) hell yeah.

    Cutting back core council services is plain wrong and to plan for it ahead of ‘nice to have’ but not necessary fluffy stuff is again plain wrong.

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  20. Albert_Ross (337 comments) says:

    Not being an Aucklander, I am not sure what exactly is this “annual eye sore that is inorganic rubbish collection” or how not collecting inorganic rubbish constitutes taking pride in your city? Surely waste collection is one of the last things a Council should be considering for the chop?

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  21. Redbaiter (10,436 comments) says:

    Some council workers were working in my street the other day. Three men. One chipped away the concrete. One dug a hole in the exposed earth. The third man filled the hole in. I watched them do this a few times as they moved down the street leaving a trail of round earth filled spaces in the concrete.

    In the end I had to asked them what the hell they were doing. They told me that it might look a bit silly now, but the system had worked well until the fourth member of their team had been made redundant. He was the one who planted the trees.

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  22. mikemikemikemike (334 comments) says:

    @mjwilknz – no way. There are too many poor folk who would simply stockpile their rubbish instead the increase of disease and rats would just put more stress on everything else. I’d rather my rates paid to get rid of it rather than pay for a train set and jizz free carpets in the Ngati Whatua room.

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  23. Lance (2,718 comments) says:

    West Auckland has managed just fine without an inorganic collection for years. The rest of Auckland seems a bit precious about such things.
    The bleating over having to mow the berms was laughable. Also hasn’t happened in West Auckland forever.

    The roading AND public transport upgrades have been long overdue but I think the rail loop is too much, at least until we are not poverty stricken and borrowing heaps.

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  24. mikemikemikemike (334 comments) says:

    West Auckland has managed fine?? Which part exactly? New Lync, Kelston, Henderson, Swanson? Is the section on Rata St next to the Shell station still the de facto tip for those in the know?

    West Auckland is not managing anything just fine, in fact – its pretty friggin average.

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  25. All_on_Red (1,744 comments) says:

    There’s nothing wrong with the super city concept. The problem is the Council doesn’t apply the concept correctly and try to make savings. Instead of reducing staff to run the same things they just added them altogether!
    I’ve met a few Council staff and frankly the salaries they are paid are very very high.
    There’s huge opportunity for savings. Many things could be privatised and many processes could be more efficient. Dare I say, too much consultation adds huge cost to these processes .We just need someone with the guts and the brains to achieve them.
    Oh and yes, get rid of that racist Board. They weren’t elected so fuck off.

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  26. mikemikemikemike (334 comments) says:

    “Oh and yes, get rid of that racist Board. They weren’t elected so fuck off.”

    Neither was Rodney – and he gave us the friggin thing!

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  27. Tarquin North (400 comments) says:

    Another classic example of left wing management.

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  28. chris (647 comments) says:

    Fewer arts and culture festivals and events are under consideration

    Fewer? WTF! Councils should not be funding arts and culture festivals. Or sport.*

    (*I’m in the sports industry, and I don’t believe sporting events should ever get council or central government funding.)

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  29. Lance (2,718 comments) says:

    @mikemike
    So like one site is the ruin of an area with 300,000 citizen’s… o.k.

    Hysteria much

    Henderson and Western Heights I can say is not straining under the weight of piles of inorganic rubbish. But hey, if maybe you see it other wise then maybe you have a vested interest?
    You aren’t a council jobsworth are you?

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  30. All_on_Red (1,744 comments) says:

    4mikes
    If we’re honest the system wasn’t working very well beforehand either. All the Councils were out of control providing non essential services and gauging the ratepayers to pay for it and the debt grew.
    The main problem we have is that our representatives are RUBBISH!
    We have to find a way of getting better qualified people to stand. I mean seriously , look at them.
    Also, I reckon the inorganic collection is probably one of the better things they do. Not that there’s usually much to take away after it’s been picked over by half of Mangare.

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  31. david (2,194 comments) says:

    The Council CEO needs to be sacked for putting forward a budget that is so ridiculously out of balance. In any sane organisation the budget process would have been managed to meet the objectives before presenting the budget. It is not rocket science to ask that the functions of Council need to be defined and the output levels specified. After that the (skilled ??) executive team finds ways to meet the objectives.

    All that can be drawn from this debacle is that the Auckland Council management is sub-standard, the oversight (Counciillors AKA the Board of Directors) is incoherent, ambiguous and dysfunctional, the Chairman of the Board (AKA the Mayor) should be before a Court on charges of fraud. In other words it is time for Revolution rather than Evolution.

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  32. wreck1080 (3,999 comments) says:

    Some auckland suburbs have sky rocketing house prices — those with the highest relative house price increases combined with a larger average rate increase are going to be absolutely walloped.

    I wouldn’t be surprised to see some rates demands going up by 50-100%.

    That is the opposite side of living in an appreciating house. Fun times.

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  33. southtop (251 comments) says:

    Why you not listen ……….. since the 2002 Local Government Act was passed Councils have been spending like sailors on shore leave.

    “The Local Government Act 2002 included a focus on sustainability with the reference to the ‘four well-beings’ social, economic, environmental and cultural. The purpose of the Act is (a) to enable democratic decision-making and action by, and on behalf of, communities; and (b) to promote the social, economic, environmental, and cultural well-being of communities, in the present and in the future.[2] The Local Government Act 2002 received the Royal assent on 24 December 2002.”

    Note the focus on sustainability and how the ‘four well beings’ enable idiots to justify ANY expenditure. Compare NZ councils with Sandy Springs Georgia: https://www.youtube.com/watch?v=f8qFvo2qJOU
    Bottom Line: Unless the Nats grow some and reform this act those who steal from the productive will continue.
    PS: You Jafas aren’t alone – and it doesn’t matter whether amalgamated or not – the fundamental rules are simply WRONG!

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  34. Alan (1,087 comments) says:

    I don’t really have a problem with the rates; the city has been starved on investment for years, we have a backlog of billions in infrastructure investment.

    The city has flourished the last few years, waterfront, britomart, wynard qtr all in good shape, hosting some great sporting events.

    We can all point to a mistake here or there, but in general terms the money seems to be well spent and Auckland is really moving forward.

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  35. mister nui (1,030 comments) says:

    Some auckland suburbs have sky rocketing house prices — those with the highest relative house price increases combined with a larger average rate increase are going to be absolutely walloped.

    I wouldn’t be surprised to see some rates demands going up by 50-100%.

    Yes, some of those nigga rich Grey Lynn and Ponsonby dwellers will soon realise that they’re not as rich as they thought they were. Especially with rising interest rates and falling house prices. Ouch.

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  36. wikiriwhis business (4,200 comments) says:

    What happened to the offer to buy the multi million dollar car park the council received.

    I said at the time if the council does not accept that offer they would look very curious at what amounts to

    face saving for Len’s train set.

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  37. insider (845 comments) says:

    A friend in government who deals regularly with Auckland council says the councils equivalent team to his has two to three times more staff to cover a city as his has for the whole country.

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  38. Paulus (2,711 comments) says:

    If Auckland City sold POA and the Airport share they would not use the money to take down some of the debt but to increase their own positions, increase the bureaucracy and spending, and Auckland Ratepayers would be no better off.
    There must be a better way to collect rate money – a Poll Tax is still the best idea where all residents contribute to the pool not just the few property owners.

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  39. mjwilknz (605 comments) says:

    @Albert_Ross, I’d recommend driving around Akl when inorganic rubbish is on… actually, no, I wouldn’t recommend doing that at all. People just leave their refuse all over place – it looks disgusting. I think we Aucklanders need to make an effort and do without the collection: we could most other Kiwis do and make the occasional trip to the rubbish dump. As well as saving the Council some dosh, the place would look so much nicer at that time of the year.

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  40. backster (2,196 comments) says:

    The Maori Advisory Board and the Council employed Maori advisers should be the first to go. Maori advisers can make use of the same consultation processes as other ethnicities without payment.

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  41. JeffW (327 comments) says:

    There is so much that could be cut before the services that a Council should be providing. But it has been evident for a couple of years at least that the strategy is to fund the things that ratepayers don’t want (the ethnic stuff, support for all sorts of bludger organisations, arts, PDB’s train set) and make ratepayers pay separately for things that are needed, e.g rubbish collection.

    Re the supercity, actually it is not the structure itself, it is the dork too many Aucklanders voted for, and the general view in much of NZ than government should always do more. Eventually, as we should know, socialists run out of other people’s money; we are starting to reach this point in AKL at least.

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  42. duggledog (1,625 comments) says:

    As soon as they get rid of inorganic collection, people won’t just start using the council dump like good little monkeys. It costs a fortune.

    So, expect a massive increase in fly tipping by the rural roads around Rodney, like Kumeu, Waitoki, Helensville, Riverhead and in Frankin, areas like Waiuku etc. Mattresses and TVs will be everywhere. I’ve seen six wheelers dumping concrete and clay fill in the middle of the night just out of Kaukapakapa, that’s your neck of the woods Garret!

    They used to include ‘free’ council tipping as part of your rates bill which kept it under control, but the stupidity which is Auckland Council will see nothing change except for no inorganic collection, and more expensive fees at the dump, resulting in ever more expensive council crews going out daily to clean up the fly tipping.

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  43. gump (1,684 comments) says:

    @wikiriwhis business

    “What happened to the offer to buy the multi million dollar car park the council received.”

    —————–

    The offer for the Downtown car-park building was unsolicited and categorically rejected by the Council.

    http://www.nzherald.co.nz/nz/news/article.cfm?c_id=1&objectid=11270511

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  44. wiseowl (979 comments) says:

    There are supposedly 500 staff in policy.What the hell do they need that many for and all overpaid.

    The idea of holding rates to inflation is fantasy.I was involved with a very good CEO that looked into this and presented brilliant evidence that it could never be achieved.Unfortunately cannot remember all the details but one factor was the continual changes to legislation by central government and the resulting cost .

    Comments relating to the Local Government Act are correct as far as changes under Clark that allowed councils to do anything.

    National have had the opportunity to change this but only tinker. They also made changes to the Act over re-organisations which are totally undemocratic and will force further amalgamations and thus repeat the Auckland experience.

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  45. OneTrack (3,371 comments) says:

    wiseowl – “The idea of holding rates to inflation is fantasy.”

    Len is just a bullshitting socialist. If anybody actually believed his “promise” to keep rates down, then or now, I have a bridge for sale.

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  46. hj (7,167 comments) says:

    Population growth requires new infrastructure:

    The BNZ Chief Economist’s view on the Auckland House Prices
    Posted by David Whitburn on 1 November 2012 |

    Tony Alexander’s view on house prices
    In BNZ Chief Economist Tony Alexander’s weekly overview, Auckland house prices are set to move upwards nicely. Here are his 19 reasons why:
     
    1. Auckland did not enter the 2008 recession then late-2008 into 2009 global financial crisis with an over-supply of property. Shortages of personnel constrained house construction from 2004 through 2008.
    2. The shortage has become worse in the past four years and last year annual consent numbers were at a four decade low.
    3. The government is explicitly aiming to grow Auckland’s population as a means of achieving “agglomeration” benefits for economic growth which accrue from high interaction amongst economic players.

    http://www.davidwhitburn.com/blogs/auckland-house-prices-to-rise-over-10-in-2013/

    From The NZ Initiative

    Agglomeration
    It is well established that cities tend to be more economically efficient than non-urban areas when measured by wages and productivity. These are called agglomeration benefits, or the positive spill
    -over effects thatcome from positioning firms and workers closer together. Advocates for compact cities have taken this as support for the measures to increase population density. However, the report shows:

    prominent urban economists, both internationally and in New Zealand, remain cautious about
    correlating population density and productivity together. The emerging literature on the topic agrees that they occur, not why they occur.

    should the population-productivity relationship exist, work by Motu Economic and Policy Research in New Zealand suggests dramatic increases in density would yield only marginal increases in productivity. Auckland’s population would have to double (100 per cent increase) to lift productivity 6.9 per cent.

    economic research in Europe shows negative spill-over effects from higher population densities can eclipse the benefits of agglomeration. This was seen in the Netherlands, where outlying regions saw greater productivity growth than urban areas (often cited as ideal examples of compact development) due in part to higher congestion in cities

    http://nzinitiative.org.nz/site/nzinitiative/files/publications/Up%20or%20Out%20-%20Report%20Summary.pdf

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  47. hj (7,167 comments) says:

    “In a time of deceit, telling the truth
    is a revolutionary act.”

    George Orwell.

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  48. you reap what you sow (41 comments) says:

    This is nonsense and only proof that One City concept is a farce. Too many people with too few brains swimming out of their depths.

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  49. Viking2 (11,680 comments) says:

    Perhaps Len should read this book.

    Government boards and committees must prove their worth or be axed, Premier Jay Weatherill announces

    ALL government boards and committees will be abolished and forced to prove their worth before they are reinstated, Premier Jay Weatherill has announced.

    He revealed the move at a Committee for Economic Development Australia lunch today, saying boards and committees had “grown like a chemistry set over the decades”.

    There are currently 440 boards that give advice to the Government and its agencies.

    They include organisations such as the Parole Board and Economic Development Board. Some are paid and others are voluntary.

    Mr Weatherill also announced that Department of Premier and Cabinet chief executive Jim Hallion will take on a “private-sector development co-ordination role” to try to fast-track worthwhile projects valued over $3 million that have been stalled by bureaucracy.

    A “simpler regulation unit” will liaise with industry about removing regulations to allow job creation.

    “Many businesses I have spoken with since the election have raised the need for simpler regulation with me,” Mr Weatherill said.

    http://www.adelaidenow.com.au/business/government-boards-and-committees-must-prove-their-worth-or-be-axed-premier-jay-weatherill-announces/story-fni6uma6-1226981760858

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  50. Mr_Blobby (207 comments) says:

    The overwhelming comment I get from Aucklanders is they just want me to get on with the job of building my railway etc etc etc etc

    Mirror mirror on the wall who is the fairest one of us all. What do we overwhelmingly want me to do.

    Listen you poor deluded prick. Stick to core Council services and cut out the other 80% of crap.

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  51. Mr_Blobby (207 comments) says:

    So where is the Central Government leadership on this???????????????????????????????????

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