And once again WCC just looking for ways to spend money and stick rates up

Stuff reports:

Wellington’s embattled mayor has suffered a rare and public defeat at the hands of his own council after trying to deliver free city parking till winter.

The winners will be community groups such as Sexual  Prevention Network (SAPN), who now look set to keep council funding that would have been cut to pay for the parking.

As I will show you, this is a red herring.

Wellington City Council has been looking at how to find $1.5 million to fund free parking in the city till June 30.  

Mayor Andy Foster’s preference at Thursday’s virtual and extraordinary meeting to discuss its pandemic response plan was to fund the free parking, which – some councillors argued –  could be better spent.

Now I’m not in favour of the free parking. Unless there is strong empirical evidence it increases retail spending (in which case the free parking should be funded by a targeted rate on CBD retailers), we should recognise it costs money to provide parking, and people should pay for it.

So I’m not in favour of what the Mayor proposed. But what is telling is that the Councillors are not saying “Hey maybe if we don’t fund this, we don’t have to whack rates up by 5% in a recession”. Instead they’re saying “Let’s spend it over here instead”.

This is why they have no credibility when they claim there is just simply no way they can avoid a huge rates increase. Of course they can. It just involves some fiscal discipline, which they seem incapable of.

Councillor Fleur Fitzsimons, who was among those opposing Foster, said the Sexual  Prevention Network faced the possibility of shutting without the funding. 

This got me curious so I looked up how much funding SAPN got from last year. It was $22,500. That is around 4% of their total revenue so hardly huge. And I suspect that the Mayor was in no way planning to propose cutting their $22,500 of funding because frankly it is peanuts compared to the $1,5 million cost. I’m certainly not advocating their funding be cut, I’m just saying that this is a red herring.

SAPN chief executive Fiona McNamara said the organisation, which focused on prevention of and education around sexual abuse, was facing a $400,000 loss this year, largely due to the Covid-19 shutdown. While it was not clear how much of the $1.5m it would get, it would help keep the organisation afloat, she said.

So actually what they are talking about is a massive increase in the funding of SAPN, rather than a cut.

Now SAPN, like the other 27,000 charities in NZ no doubt does good work. But it is not the job of to bail out charities. Every charity in NZ is probably hurting right now. Will WCC bail out the Red Cross? Salvation Army? IHC?

The central Government has rightfully put in place a wage subsidy scheme that will help charities in the short term. This is an appropriate thing for central Government to do.

What the Council however should be doing is recognising that many families and businesses of Wellington have had a massive income drop and can’t afford to have a big increase in their rates bill. If the Council decides not to do free parking, then it should not spend the money elsewhere, but instead not hike up rates so much.

Comments (36)

Login to comment or vote

Add a Comment

%d bloggers like this: