Significant job cuts are likely for Auckland Council's head office as it looks to plug a forecast $295 million budget deficit as well as cover the cost of storm and cyclone damage and the City Rail Link budget blow-out, the mayor says.
In an interview with Newsroom published on Thursday, Auckland councillor Maurice Williamson said there would be a substantial downsizing of council head office staff numbers.
When asked by Morning Report whether there was any truth in this, Auckland Mayor Wayne Brown said: "Absolutely true."
"We're asking the council itself to make as much saving as it can and we're particularly asking the CCOs [council-controlled organisations] to make savings. There's been huge growth in salary costs in the council-controlled organisations in the past couple of years."
Asked how many roles would be cut, Brown replied: "Every person should be concerned."
"We're in an economy that is in trouble at the moment and so everything has to be justified."
CRL budget blowout: 'I'll be tough about this'
On Wednesday, it was revealed Auckland's City Rail Link will be finished a year late and cost an extra $1 billion.
Brown said he did "not really" accept the CRL cost blowout was the result of Covid-19.
"I was predicting this a year ago on the way through to be elected ... it's not a bad project," he said.
"What happens with these ones here ... the contract was set up poorly in my view, which was my initial complaint even a year ago."
The government said it would split the rail link blow-out 50:50 with the council.
Brown said he would be asking the government to pay a larger sum.
"We had no say in the Covid rules, we had less say in what I would like in the actual contract management setup. The people that made the decision were from Wellington and inexperienced in my view in that field - they're the people that the government like to use but I wouldn't.
"So there will be a discussion about that."
Brown said the council needed to pay its fair share but he would work hard to minimise the impact.
"I'll be tough about this."
In the future, things would be run by Auckland, not Wellington, Brown said.
"It will make more pressure on the budget.
"I'll be going to the government and saying 'Listen here mate, we didn't actually have 50 percent of the decision making'."
Cutting costs and services
The council needs to find about $1.5bn to cover the cost of storm and cyclone damage, and the City Rail Link budget blow-out.
This comes on top of a forecast budget deficit of $295m in the coming year.
The draft budget sees cuts to regional, community and social services - by $20m.
Regional contestable arts, culture and events grants would be slashed by $3m.
Brown said a lot of the social services were "nice to haves" but things the government should pay for.
He agreed arts and libraries played a role in communities but said everything needed to be trimmed to save ratepayers from filling the hole.
"This was an opportunity to look at everything, I'm not particularly picking on arts ... I'd rather be coming in here and expanding the spend on everything but the previous people who have served for years have built this big hole.
"And they've got to accept some responsibility for that. You can blame me for coming in here and suddenly ... and if everyone has a little bit of a haircut that's better than gauging out the poor old ratepayers."
Young people were turning to digital books, he said.
"I'm just questioning everything at the moment."
Brown said he did not want to borrow the council "into debt".
The draft budget included a proposal to sell council shares in Auckland Airport.
The Auckland airport shares were "a cost to us that we can't afford" that gave no return, Brown said.
"The previous council owning those ... is exactly why there is pressure on arts now, let's get real about this."
Asked whether golf courses should be funded by council, Brown said they played a role in preventing flooding to nearby housing.
"What was really interesting after the flood, I hired a helicopter, my personal expense, to have a look around and we flew over the North Shore and the Pupuke golf course was flooded which was excellent because the houses around it hadn't.
"You have to have some green spaces to flood."
Raising rates was an end of the road option but not a preferred option, Brown said.
