AKL Council Strat and Finance Agenda 15.02.2012

Embed Size (px)

Citation preview

  • 8/3/2019 AKL Council Strat and Finance Agenda 15.02.2012

    1/88

    Note: The reports contained within this agenda are for consideration and should not be construed as Council policyunless and until adopted. Should Members require further information relating to any reports, please contactthe relevant manager, Chairperson or Deputy Chairperson.

    I hereby give notice that an ordinary meeting of the Strategy and Finance Committee will be heldon:

    Date:Time:Meeting Room:Venue:

    Wednesday 15 February 201210.00amReception Lounge Level 2Auckland Town Hall301-305 Queen StreetAuckland

    Strategy and Finance Committee

    OPEN AGENDA

    MEMBERSHIP

    Chairperson Cr Penny WebsterDeputy Chairperson Cr Des Morrison

    Councillors Cr Anae Arthur Anae Cr Mike LeeCr Cameron Brewer Cr Richard Northey, ONZMHis Worship the Mayor Len Brown Cr Calum PenroseCr Dr Cathy Casey Cr Dick QuaxCr Sandra Coney, QSO Cr Noelene Raffills, JPCr Alf Filipaina Cr Sharon Stewart, QSMCr Hon Chris Fletcher, QSO Mr David TaipariCr Michael Goudie Mr John TamihereCr Ann Hartley, JP Cr Sir John Walker, KNZM, CBEDeputy Mayor Penny Hulse Cr Wayne Walker

    Cr George Wood, CNZM

    (Quorum 12 members)

    Cecily DowerCommittee Secretary

    10 February 2012

    Contact Telephone: (09) 373 6200Email: [email protected]: www.aucklandcouncil.govt.nz

  • 8/3/2019 AKL Council Strat and Finance Agenda 15.02.2012

    2/88

  • 8/3/2019 AKL Council Strat and Finance Agenda 15.02.2012

    3/88

    Strategy and Finance Committee15 February 2012

    Page 3

    ITEM TABLE OF CONTENTS PAGE

    1 Apologies 5

    2 Declarations of Interest 5

    3 Confirmation of minutes 5

    4 Petitions 5

    5 Public Input 5

    6 Local Board Input 5

    7 Extraordinary Business 5

    8 Notices of Motion 6

    9 Allocation of decision making for Parks Services 7

    10 Long-term Plan financials, policies and performance 15

    11 Rates Transition Management Policy alternative options 25

    12 Maori Outcomes and Associated Budgets 47

    13 Long Term Plan Local Board Issues 57

    14 Long Term Plan Hearings process

    This report was not available when the agenda was compiled and will be circulated assoon as possible.

    15 Adoption of the Draft Long-term Plan 2012-2022 63

    16 Alternative Transport Funding 69

    17 Consideration of Extraordinary Items

  • 8/3/2019 AKL Council Strat and Finance Agenda 15.02.2012

    4/88

  • 8/3/2019 AKL Council Strat and Finance Agenda 15.02.2012

    5/88

    Strategy and Finance Committee15 February 2012

    Page 5

    1 Apologies

    At the close of the agenda no apologies had been received.

    2 Declaration of interest

    Members are reminded of the need to be vigilant to stand aside from decision makingwhen a conflict arises between their role as a member and any private or other externalinterest they might have.

    3 Confirmation of minutes

    That the minutes of the Strategy and Finance Committee held on Thursday, 2 February2012 and the minutes of the Confidential Meeting of the Strategy and Finance Committeeheld on Thursday, 2 February 2012, be confirmed as a true and correct record of themeeting.

    4 Petitions

    At the close of the agenda no requests for petitions had been received.

    5 Public Input

    Standing Order 3.21 provides for Public Input. Applications to speak must be made to theCommittee Secretary, in writing, no later than two (2) working days prior to the meetingand must include the subject matter. The meeting Chairperson has the discretion todecline any application that does not meet the requirements of Standing Orders. Amaximum of thirty (30) minutes is allocated to the period for public input with five (5)minutes speaking time for each speaker.

    At the close of the agenda no requests for public input had been received.

    6 Local Board Input

    Standing Order 3.22 provides for Local Board Input. The Chairperson (or nominee of thatChairperson) is entitles to speak for up to five (5) minutes during this time. TheChairperson of the Local Board (or nominee of that Chairperson) shall wherever practical,give two (2) days notice of their wish to speak. The meeting Chairperson has the discretionto decline any application that does not meet the requirements of Standing Orders.

    This right is in addition to the right under Standing Order 3.9.4 to speak to matters on theagenda.

    At the close of the agenda no requests for local board input had been received.

    7 Extraordinary business

    Section 46A(7) of the Local Government Official Information and Meetings Act 1987 (asamended) states:

    An item that is not on the agenda for a meeting may be dealt with at that meeting if-

    (a) The local authority by resolution so decides; and

  • 8/3/2019 AKL Council Strat and Finance Agenda 15.02.2012

    6/88

    Strategy and Finance Committee15 February 2012

    Page 6

    (b) The presiding member explains at the meeting, at a time when it is open to thepublic,-

    (i) The reason why the item is not on the agenda; and

    (ii) The reason why the discussion of the item cannot be delayed until asubsequent meeting.

    Section 46A(7A) of the Local Government Official Information and Meetings Act 1987 (asamended) states:

    Where an item is not on the agenda for a meeting,-

    (a) That item may be discussed at that meeting if-

    (i) That item is a minor matter relating to the general business of the localauthority; and

    (ii) the presiding member explains at the beginning of the meeting, at a timewhen it is open to the public, that the item will be discussed at the meeting;but

    (b) no resolution, decision or recommendation may be made in respect of that itemexcept to refer that item to a subsequent meeting of the local authority for furtherdiscussion.

    At the close of the agenda no requests for extraordinary business had been received.

    8 Notices of Motion

    At the close of the agenda no requests for notices of motion had been received.

  • 8/3/2019 AKL Council Strat and Finance Agenda 15.02.2012

    7/88

    Item9

    Strategy and Finance Committee15 February 2012

    Allocation of decision making for Parks Services Page 7

    Allocation of decision making for Parks ServicesFile No.: CP2012/01108

    Executive Summary

    The current decision making allocation for parks services allocates the following responsibilities: The governing body is responsible for open space strategy and policy, determining the need for

    and general location of new parks, Regional Parks formerly managed by the Auckland RegionalCouncil and parks containing a volcanic cone or feature. This recognises that a consistent andcoordinated approach to policy, determining level of parks provision, and governance of parksproviding an Auckland-wide benefit promotes the well-being of communities across Auckland.

    Local boards are responsible for local parks, including the specific location of new parks,improvements and use and activities within local parks. This enables local boards to reflect thediverse needs and preferences of their local communities within an overarching regional policyframework.

    As part of the review of the current decision-making allocation, clarification has been sought as to

    which specific parks should be within the decision-making allocation of the governing body. Theapproach proposed as part of the review is to list in a Schedule 1, the specific parks that fall withinthe governing bodys decision-making responsibility. These parks provide Auckland wide benefitsand the allocation of decision-making responsibility for these parks to the governing body willpromote the well-being of communities across Auckland by: Balancing the delivery of Auckland wide and local benefits Ensuring a consistent and co-ordinated user experience Addressing open space areas located outside local board areas

    The parks to be included in Schedule 1 provide benefits that are valued, used by, or ofsignificance to communities from across Auckland or a significant portion of the Auckland area.

    As such, Schedule 1 is likely to extend beyond existing parks managed by the former AucklandRegional Council to include parkland that is contiguous and some urban parks. The benefitsaccruing to Auckland are likely to arise from one or more of the following attributes: Natural features Cultural features Recreational opportunities

    It is proposed that a procedure for an evidence-based assessment of Auckland wide benefits isdeveloped, and using that agreed procedure, specific parks would be identified for inclusion inSchedule 1. Delegated authority for finalising Schedule 1 has been given to Cr Webster, CrConey and Cr Lee (Resolution number SF/2011/160, Strategy and Finance Committee, 30November). It is recommended, however, that detailed criteria for the assessment of Schedule 1

    parks is reported for approval to the Parks, Recreation and Heritage Forum, with the Forum alsoto confirm the final Schedule 1 list.

    There are a number of parks that have formed part of the Treaty of Waitangi settlements forAuckland/Tamaki Makarau. Decision making in relation to these parks will in time be theresponsibility of a co-governance body. This body has yet to be formed. As an interim measure, itis proposed that the decision-making responsibility for these parks is allocated to the governingbody. These parks would also be included in Schedule 1.

  • 8/3/2019 AKL Council Strat and Finance Agenda 15.02.2012

    8/88

    Item9

    Strategy and Finance Committee15 February 2012

    Allocation of decision making for Parks Services Page 8

    Recommendation/sa) That the report be received.

    b) That the Strategy and Finance Committee endorse:

    i) That the governing body is allocated decision making responsibility for

    parks delivering Auckland wide benefitsii) That a procedure for an evidence-based assessment of Auckland wide

    benefits delivered by parks is developed and reported to the Parks,Recreation and Heritage Forum for approval

    iii) That a schedule of parks delivering Auckland wide benefits is preparedbased on the agreed assessment procedure and finalised by the Parks,Recreation and Heritage Forum prior to the adoption of the Long Term Planin 2012

    iv) That the governing body is allocated decision making responsibility for the

    parks subject to Treaty of Waitangi settlements as an interim measure untilsuch time as that responsibility is allocated to a co-governing body.

    BackgroundThe Local Government (Auckland Council) Act 2009 (the Act) requires the governing body toallocate decision-making responsibility for non-regulatory activities to either the governing body orlocal boards. This must be undertaken in accordance with certain legislative principles and afterconsidering the views and preferences of each local board.

    The initial decision-making allocation to local boards was made by the Auckland TransitionAgency (ATA). This was an initial allocation until 1 July 2012, when the Long-term Plan (LTP) isadopted by the governing body. Each LTP and annual plan must identify the non-regulatoryactivities allocated to local boards.

    In relation to parks services, the current allocation of non-regulatory decision-making for parksallocates responsibility as follows: The governing body is responsible for open space strategy and policy, determining the need for

    and general location of new parks, former ARC parks and parks containing a volcanic cone orfeature. This recognises that a consistent and coordinated approach to policy, determining levelof parks provision, and governance of parks providing an Auckland-wide benefit promotes thewell-being of communities across Auckland.

    Local boards are responsible for local parks, including the specific location of new parks,improvements and use and activities within local parks. This enables local boards to reflect thediverse need and preferences of their local communities within an overarching regional policyframework.

    As part of the development of the 2012-2022 LTP, the current decision-making allocation hasbeen reviewed. The review was based on the existing allocation, with amendments proposed byexception where governance experience has demonstrated a need to amend the allocation.At its meeting on 3 November, the Strategy and Finance Committee made the following inprinciple resolutions on the allocation in relation to parks services (Resolution numberSF/2011/137):

  • 8/3/2019 AKL Council Strat and Finance Agenda 15.02.2012

    9/88

    Item9

    Strategy and Finance Committee15 February 2012

    Allocation of decision making for Parks Services Page 9

    That the Strategy and Finance Committee agree in principle, subject to feedback from the LocalBoards, the changes to the Local Board decision making policy as follows:

    i) The allocation of parks with volcanic features that are not subject to Treaty of Waitangisettlement is deferred awaiting an officers report on appropriate options for allocationbetween local boards and the Governing Body.

    On 30 November, the Strategy and Finance Committee met to resolve on the adoption of the draftlong-term plan for consultation, including the revised decision making allocation. At this meeting,the committee passed the following resolutions in relation to the allocation (Resolution numberSF/2011/160):

    That the Strategy and Finance Committee:

    b) Approves the revised allocation of non-regulatory decision-making responsibilities to thegoverning body and local boards for inclusion in the draft Long-term Plan 2012-2022

    c) Notes that further work is being undertaken on the parks and town centres allocation and thatthis will be completed in time for approval of the final draft of the Long-term Plan in February2012

    d) Notes that further work is being undertaken on other decision-making and collaborativegovernance arrangements and that these will be reported back to the Committee and localboards in 2012

    e) That the Chair, Cr Coney and Cr Lee be delegated authority to sign off the final Schedule 1:Regional facilities and parks.

    Decision MakingLocal Government (Auckland Council) Act 2009Section 17 of the Local Government (Auckland Council) Act 2009 sets out the principles forallocation of decision-making. Section 17(2)(b) states:decision-making responsibility for a non-regulatory activity of the Auckland Council should beexercised by its governing body if the nature of the activity is such that decision making on anAuckland-wide basis will better promote the well-being of the communities across Aucklandbecause (i) the impact of the decision will extend beyond a single local board area; or(ii) effective decision making will require alignment or integration with other decisions that are

    the responsibility of the governing body; or(iii) the benefits of a consistent or coordinated approach across Auckland will outweigh the

    benefits of reflecting the diverse needs and preferences of the communities within each

    local board area.

    With regard to parks services, there are two broad areas where a consistent and co-coordinatedapproach to decision-making by the governing body would better promote the well-being ofcommunities across Auckland:

    1. Delivering an integrated Auckland wide open space networkThere are a number of benefits to be gained from adopting a consistent and co-coordinatedapproach to the delivery of parks services across Auckland. These include: An efficient, effective and economic service Delivering a consistent and co-coordinated user experience Integrating large scale (multi-board area) initiatives

  • 8/3/2019 AKL Council Strat and Finance Agenda 15.02.2012

    10/88

    Item9

    Strategy and Finance Committee15 February 2012

    Allocation of decision making for Parks Services Page 10

    The current decision making allocation supports the delivery of an integrated Auckland wideopen space network through the allocation of decision making responsibility for regionalopen space strategy and policyto the governing body. This regional strategy and policy willset minimum standards for provision and Auckland wide management policies for the openspace network across Auckland, and facilitate an integrated approach to large-scaleinitiatives.

    Local board decision making with regard to local parks would be consistent with the regionalstrategy and policy. In this way, the current decision making allocation will balance thebenefits of a consistent and co-coordinated approach with the benefits of reflecting thediverse needs and preferences within each local board area.

    2. Parks providing Auckland wide benefitsAuckland has a well-established network of parks that provide open space benefits andexperiences to both an Auckland wide audience and to the many national and internationalvisitors to the Auckland area. These include the Regional Park network, formerly managed

    by the Auckland Regional Council, as well as a number of other destination parks formerlymanaged by other legacy councils.

    There are a number of benefits to be gained from regional decision-making responsibility bythe governing body for those parks that primarily serve an Auckland wide and visitoraudience. These include:

    Balancing the delivery of Auckland wide and local benefitsWhile most of these parks deliver local benefits alongside the Auckland wide benefits,there may be circumstances in which the governing body decision-making and fundingallocation is more appropriate..

    These include:o Differing Auckland wide and local priorities

    There may be circumstances where priorities for the development and management ofparks delivering Auckland wide benefits (Schedule 1 Parks) may be different from localpriorities for open space development and management (seeking to deliver localbenefits). For example, local priorities may be addressing a shortfall in sports fieldprovision, whereas regional priorities may be the preservation of existing wildernesscharacter of a park.

    o Impact of delivering Auckland wide benefits on local communitiesThere may be circumstances where the delivery of Auckland wide benefits fromSchedule 1 Parks incurs effects that are best mitigated by the governing body, ratherthan the financial burden falling to the local board. For example, a popular Schedule 1Park may generate high volumes of traffic at certain times of the year, whichcontributes to congestion on local roads and an increased demand for parkingdevelopment.

    Ensuring a consistent and co-coordinated user experienceThe network of parks delivering Auckland wide benefits includes those parks that arefrequently visited by national and international visitors. They therefore form an importantpart of the visitor experience of Auckland, and the quality of that visitor experience will beenhanced by ensuring that these destination parks are managed to a consistently highstandard and as a fully consistent and co-coordinated network.

  • 8/3/2019 AKL Council Strat and Finance Agenda 15.02.2012

    11/88

    Item9

    Strategy and Finance Committee15 February 2012

    Allocation of decision making for Parks Services Page 11

    Parks falling outside local board areasAuckland Council owns and manages a small number of park areas which lie outside theAuckland Council boundary, and therefore outside any local board area. These parkareas are currently limited to land owned in the Waikato region, including WhakatiwaiRegional Park, Waharau Regional Park, and approximately 8,000ha of the Hunua

    Ranges Regional Park.The current decision making allocation supports a direct decision making role for the governingbody for those parks delivering Auckland wide benefits. The identification of those specific parksthat deliver Auckland wide benefits requires will require comprehensive assessment of bothbenefits and significance. The proposed approach to this assessment is set out below.

    Definition of Schedule 1 Parks to be allocated to governing bodyIt is proposed that Schedule 1 Parks should include those parks that provide benefits that arevalued, used, or of significance to communities from across Auckland, or a significant portion ofthe Auckland. As such, Schedule 1 is likely to extend beyond existing parks managed by theformer Auckland Regional Council to include parkland that is contiguous and some urban parks.

    The benefits accruing to Auckland are likely to arise from one or more of the following attributes: Natural features

    These relate primarily to the physical characteristics of parks, and include landscapes,ecological and geological values.

    Cultural featuresThese relate primarily to the cultural and spiritual associations parks hold for communitiesacross Auckland, and include historic, archaeological, educational, community or other specialfeatures.

    Recreational and visitor experience opportunitiesThese relate primarily to the use of parks, and include features, facilities and experiencesproviding both general recreation (e.g. walking trails, events etc) and more specialistrecreational pursuits.

    For each of these benefit attributes the assessment of features and opportunities that provideAuckland wide benefits include those that may be: Unique or rare Exemplars of their type An important connecting part of a wider network that delivers Auckland wide benefits Used by a high proportion of users from across Auckland and/or outside the Auckland area Valued by residents from across Auckland

    Review and refinement of Schedule 1

    At this time, a comprehensive assessment of those parks that deliver Auckland wide benefits hasnot been undertaken. It is proposed that a procedure for an evidence based assessment ofAuckland wide benefits is developed and reported to the Parks, Recreation and Heritage Forumfor approval. Where possible this assessment would include empirical measures, e.g. proportionof visitors from beyond the local board area.

    Schedule 1 will be finalised following a comprehensive assessment, and it is recommended that itbe agreed by the Parks, Recreation and Heritage Forum.

    Parks subject to Treaty of Waitangi settlement and other co-governance arrangementsA number of parks which include volcanic cones have been included as part of the Treaty ofWaitangi settlement for Auckland/Tamaki Makarau. Decision making for these parks will in the

    future be made by a co-governance body, which will include representatives from both Iwi andAuckland Council. The precise form and operation of this co-governance body has not beendetermined at this time.

  • 8/3/2019 AKL Council Strat and Finance Agenda 15.02.2012

    12/88

    Item9

    Strategy and Finance Committee15 February 2012

    Allocation of decision making for Parks Services Page 12

    As an interim measure, it is proposed that the governing body is allocated decision makingresponsibility for those parks identified as forming part of the Treaty of Waitangi settlement forAuckland/Tamaki Makaurau. Decision making responsibility for these parks will in time pass tothe future co-governance body. Such parks will also be included in Schedule 1 until such time asdecision making responsibility passes to the future co-governance body. Any additional parkswhich in the future become subject to Treaty of Waitangi settlements should also be added toSchedule 1 as an interim measure, as and when the settlements are formalised.

    In addition to parks subject to Treaty of Waitangi settlements, there are a small number of otherparks that are currently managed through park specific co-governance arrangements, and theseexisting co-governance arrangements will remain in place.

    Significance of DecisionThis report does not trigger the Significance Policy.

    Maori Impact StatementA number of parks which include volcanic cones have been included as part of the Treaty ofWaitangi settlement for the Tamaki Collective. In addition, there are a number of further parkareas that have been identified as being potentially included in future settlements. Decisionmaking for these parks will in the future be made by a co-governance body, which will includerepresentatives from both Iwi and Auckland Council.

    As an interim measure, it is proposed that the governing body is allocated decision makingresponsibility for those parks currently identified as forming part of the Tamaki Collective Treaty ofWaitangi settlements, with that decision making responsibility in time passing to the future co-governance body. This will ensure consistency of decision making for iwi, and clarity ofresponsibility.

    ConsultationPublic consultation on the proposed decision making allocation for Parks services will occur aspart of the Long Term Plan consultation process.

    Local Board ViewsLocal boards resolved formal feedback on the revised allocation of decision making at businessmeetings in late 2011. A summary of the formal feedback received from local boards on theallocation of decision making in relation to parks is set out below (this feedback was presented to

    the Strategy and Finance Committee at its meeting on 30 November 2011): A number of local boards (8) resolved that decision-making and oversight of parks containing

    a volcanic feature should be allocated to the local board unless they are subject to a Treaty ofWaitangi settlement or deemed regional within one of the exceptions in section 17(2).

    Some local boards (5) resolved that decision-making and oversight of all parks (regardless ofvolcanic features) should be allocated to the local board unless they are subject to a Treaty ofWaitangi Settlement or deemed regional within one of the exceptions in section 17(2).

    Some local boards (5) have identified parks containing volcanic features that they considershould be allocated to the local board.

    This report will be circulated to local board chairs for their informal feedback prior to the Strategy

    and Finance Committee on 15 February 2012, and this feedback will be presented verbally at themeeting.

  • 8/3/2019 AKL Council Strat and Finance Agenda 15.02.2012

    13/88

    Item9

    Strategy and Finance Committee15 February 2012

    Allocation of decision making for Parks Services Page 13

    Further feedback from local boards will be sought during the special consultative procedure for theLTP.

    Financial and Resourcing ImplicationsCouncil budgets are allocated based on decision-making responsibilities. Therefore, any changes

    to the current allocation post approval of Schedule 1 will be reflected in the respective budgets ofthe governing body and local boards within the Long Term Plan prior to its adoption.

    Legal and Legislative ImplicationsThe allocation of non-regulatory decision-making responsibilities is in accordance with therequirements of the Local Government (Auckland Council) Act. If one or more local board isdissatisfied with an allocation decision by the governing body, and a mutually acceptable andtimely resolution cannot be reached between the parties, then the dispute can be referred to theLocal Government Commission for a binding determination.

    Implementation IssuesIt is likely that the compilation of Schedule 1 will result in recommended changes to thegovernance of particular parks, which will require consultation with affected Local Boards.

    AttachmentsThere are no attachments for this report.

    Signatories

    Authors Rob Cairns, Manager Region wide Community and Cultural Policy

    Reviewer Ruth Stokes, Manager Community and Cultural Policy

    Authoriser(s) Penny Pirrit, Manager Regional and Local PlanningDr Roger Blakeley, Chief Planning OfficerAndrew McKenzie, Chief Financial Officer

  • 8/3/2019 AKL Council Strat and Finance Agenda 15.02.2012

    14/88

  • 8/3/2019 AKL Council Strat and Finance Agenda 15.02.2012

    15/88

    Item1

    0

    Strategy and Finance Committee15 February 2012

    Long-term Plan financials, policies and performance Page 15

    Long-term Plan financials, policies and performanceFile No.: CP2012/01294

    Executive Summary

    The draft Long-term Plan was distributed to elected members, representatives from CouncilControlled Organisations, senior council officers and audit for review on 23 December. A widerange of feedback has been received and this report explains how this feedback has beenincorporated into the financial information, policy information and performance information withinthe updated draft plan reported separately on this agenda.

    Financial information updates have been driven by the identification of errors and new informationthat has become available. Changes to operating expenditure and revenue have largely beenpositive and have led to a reduced overall rates requirement. This improved operating positionhas allowed council to reduce its borrowings despite an increase in net capital expenditure. Theforecast rates increase remains within the limits set as part of the financial strategy with increasedcapacity in the later years of the plan.

    The financial strategy has been updated to reflect changes in financial information and also toimprove readability and disclosure of important items. Revenue and financing policy and ratingpolicy have been updated to reflect changes in financial information and also to include a newtargeted rate. Other policies have received editorial updates as a result of the reviews.

    Reviews of performance information highlighted a number of areas for improvement. These havebeen addressed through the alteration or replacement of measures, the incorporation of newmeasures, the updating of baseline comparators and targets, and editorial changes to enhanceclarity.

    Recommendation/sa) That the report be received.

    b) That the Strategy and Finance Committee notes the changes to financialinformation, policies and performance information contained within the draft Long-term Plan as a result of officer review and audit.

    BackgroundOn 23 December 2010, officers released the draft Long-term Plan to elected members,representatives from Council Controlled Organisations, senior council officers and audit for review.This reflected the decisions made by the Strategy and Finance Committee during November 2011.In response to this review a number of changes have been made to financial, performance andpolicy information. This report provides an overview of these changes.

    Decision Making1. FINANCIAL UPDATE

    1.1. Overview

    Changes to financial information within the draft long-term plan have resulted from newinformation that has become available, to address feedback from the audit process and from

    further review work. Allocations of corporate overhead costs and interest mean that all financialstatements within the document have changed to some extent.

  • 8/3/2019 AKL Council Strat and Finance Agenda 15.02.2012

    16/88

    Item10

    Strategy and Finance Committee15 February 2012

    Long-term Plan financials, policies and performance Page 16

    1.2. Operating expenditure and revenue

    Compared to the December draft, there is a total decrease in operating expenditure of $144million and an increase in operating funding of $111 million. This has led to a reduction in theoperating funding deficit of $255 million. While there was a large volume of changes, the keychanges contributing to this include: an increase in the forecast operating funding surplus for the Major shareholdings and

    investment activity of $106 million across the plan period depreciation expenditure reductions of $93 million over ten years finance cost reductions of $120 million over ten years increases in other operating expenditure of around $70 million changes to efficiency savings targets (discussed below).

    An efficiency savings target was included in the 23 December document at the level of $60 millionin 2012/2013 increasing by $10 million to $70 million from 2013/2014 to 2021/2022. This hasbeen reviewed and new targets included in the financial information based on current year-to-dateperformance and changes in operating expenditure and revenue which have resulted in some ofthe savings targeted for the early years of the plan already realised in the budget.

    Targets have been reset on the basis of a percentage of controllable costs (operating costs lessdepreciation and interest). In 2012/2013 the target is set at 3% of controllable costs ($40 million).For the next three years the target is a further 1% per annum and then in the two following 0.5%per annum. This profile reflects

    $ million

    2013 2014 2015 2016 2017 2018 2019 2020 2021 2022

    3% 1% 1% 1% 0.5% 0.5%

    40.0 13.7 14.1 14.4 7.3 7.7

    40.0 53.7 67.8 82.2 89.5 97.2 97.2 97.2 97.2 97.2

    Savings as a percentage ofcontrollable costs

    Increase in permanent ongoing

    savings

    Cummulative savings target

    Financial year ending 30 June

    1.3. Capital expenditure and revenue

    Compared to the December draft, capital expenditure net of capital subsidies has increased by$95 million over ten years as a result of a correction to inflation calculations, partially offset by arevision to the capital programme. In addition, a review of qualifying growth capex has resulted inan increase in forecast development contributions revenue of $59 million across the long-termplan period.

    1.4. Borrowing and treasury ratios

    Overall borrowing has reduced such that forecast group debt at 30 June 2022 is now $45 million

    lower than in the 23 December statements.The decreased operating funding deficit, along with the increased development contributionsrevenue and a reduction in projected weathertightness payments has more than offset theincreased net capital expenditure discussed in 1.3 above. This has resulted in a reduction in theborrowing required to fund capital expenditure.The prudential ratios prescribed in the treasury management policy have been recalculated (with arefined methodology) and are now reflected in full in the Notes to the financial statements (volume3) as well as in graphical form in the Financial strategy (volume 1). The updated ratios show ournet borrowing and interest to be even more comfortably within the limits set by the policy.

    1.5. Rates

    Despite some small increases in the total general rates amount in early years of the plan, theincreases continue to sit within the limits directed by the Strategy and Finance Committee withincreased capacity in the latter years to absorb shocks, increase expenditure or reduceborrowings if deemed prudent.

  • 8/3/2019 AKL Council Strat and Finance Agenda 15.02.2012

    17/88

    Item1

    0

    Strategy and Finance Committee15 February 2012

    Long-term Plan financials, policies and performance Page 17

    $ million

    2013 2014 2015 2016 2017 2018 2019 2020 2021 2022

    24 December 3.51% 4.74% 4.84% 4.88% 4.90% 4.94% 4.94% 4.94% 4.90% 4.84%

    15 February 3.60% 4.89% 4.88% 4.89% 4.88% 4.82% 4.74% 4.74% 4.89% 3.59%

    Difference 0.09% 0.15% 0.03% 0.01% -0.02% -0.12% -0.20% -0.21% -0.01% -1.25%

    3.60% 4.90% 4.90% 4.90% 4.90% 4.90% 4.90% 4.90% 4.90% 4.90%Rates increase limit

    Projected ratesincrease for

    existingratepayers

    Financial year ending 30 June

    2. POLICY UPDATE

    2.1. Financial Strategy

    The requirement for a financial strategy was one of the central amendments made by theGovernment to the Local Government Act 2002 in 2010. The strategy has been updated in toreflect the changes in financial information discussed above and substantially restructured as partof the sub-editing and audit process. Aside from general editing, the key non-financial changesinclude: better identification of the some of the central themes of the strategy including the mix of new

    capital investment, rates and borrowings greater discussion of transport funding and the City Rail Link enhanced disclosure of efficiency savings targets removal of some redundant sections (eg financial policies) replacement of tables with graphs and figures to enhance readability and presentation.

    2.2. Revenue and financing policyDuring the finalisation of the budget changes were made to the allocation of corporate overheads,the calculation of interest and depreciation, and the allocation of growth related capitalexpenditure. As a result the costs allocated to a number of activities changed and hence thebalance of funding sources for operating and capital expenditure presented have been adjusted.Minor changes have been made to the recovery percentages rather than fees and charges. Thefees and charges levels were set taking into consideration cost recovery targets determinedbalancing affordability, distribution of benefits, causer of costs, and councils wider objectives. Thebudget adjustments do not change the underlying issues that determined the level of the charges.

    The key changes are: the major shareholdings and investments activity now showing a gross capital expenditure of

    $260 million for the LTP period to account for the forecast capital spend of Ports of AucklandLimited

    shift of capital expenditure from other commercial activities to parks management servicesas the allocation of activity budgets was further refined

    contributions funding removed from bus and ferry activities contributions funding added to city transformation projects activity there is no substantive change to operating expenditure funding proportions.

    In addition a number of minor editorial changes have been made to improve clarity andpresentation.

    2.3. Rating policy and transition managementNo significant changes have been made to the rating policy. A number of minor editorial changeshave been made to improve clarity and presentation.

    The dollar value of individual rates as presented in volume three and the funding impact statementhave been adjusted to reflect the finalisation of the budget and hence the overall ratesrequirements and the requirements for individual targeted rates as necessary. The key changesarise from adjustments to the allocation of overheads in the final budget. They are to the:

  • 8/3/2019 AKL Council Strat and Finance Agenda 15.02.2012

    18/88

    Item10

    Strategy and Finance Committee15 February 2012

    Long-term Plan financials, policies and performance Page 18

    waste management targeted rates which decrease on average by 2.8 per cent rural sewerage targeted rate which increases by 5.5 per cent.

    In making these changes officers have considered factors including affordability and distribution ofbenefits. Both targeted rates are set at levels that fully fund the private component of the servicesprovided. The impact of these changes on rates affordability is expected to be minimal. Theaffordability of rates is addressed at an overall level.

    A new targeted rate, the Kumeu Huapai Riverhead targeted rate, has been added to the ratingpolicy. This rate will be set on properties that receive financial assistance from Auckland Councilfor the purchase and installation of equipment for pumping waste from the property to Watercarespressurised wastewater scheme. The targeted rate will provide for repayment of the principal(estimated to be around $10,000 per property) and interest on a table mortgage basis over 15years. The rate has been included to allow the council to fulfil the contractual commitments madeby the former Rodney District Council to provide financial assistance repayable via a targeted rateto parties signing up to join the pressurised wastewater scheme. Watercare Services Limited isscheduled to begin construction on the scheme in 2012. It is unclear at this stage how many ofthe parties who signed contracts with the former Rodney District Council will seek the financial

    assistance.

    Another report on this agenda proposes amendments to the text of the draft Long-term Plan 2012-2022 to provide for consideration of additional transition management options.

    2.4. Amendments to other financial and non-financial policiesA number of minor editorial changes have been made to improve clarity and presentation of thefollowing policies: Proposal for wastewater tariffs Local boards funding policy Rates remission and postponement policy

    Maori freehold land rates remission and postponement policy Auckland Airport shareholding policy Public private partnership policy Significance policy.

    2.5. Local Board discretionary budgets.At the meeting on 30 November 2011, the Committee resolved, among others, that the Strategyand Finance Committee:c) Notes that as local board budgets are generally based on historical decisions of legacy

    councils, there are significant variances in the level of discretionary budget available tolocal boards and that officers report back on the implications of this with any appropriaterecommendations.

    Officers will consider the implications of the variances in the level of discretionary budget availableto local boards based on historical decisions of legacy councils alongside any other feedback thatwill be received during the long-term plan consultation process. Based on this work, officers willreport back to the Committee on possible amendments to the Long-term Plan 2012-2022.

    3. PERFORMANCE INFORMATION UPDATE

    Both the internal and audit reviews of performance information identified a number of issues.Officers have amended the information to address these issues with the key areas of change

    noted below. existing measures altered, replaced, or new measures added to address any gaps in

    performance tables levels of service statements reworded to accurately reflect the rationale of the service

  • 8/3/2019 AKL Council Strat and Finance Agenda 15.02.2012

    19/88

    Item1

    0

    Strategy and Finance Committee15 February 2012

    Long-term Plan financials, policies and performance Page 19

    targets updated to more accurately reflect delivery plans and/or budgets allocations baseline figures updated as new data was made available other editorial changes to measures/footnotes to enhance clarity.

    Significant performance measure changes are listed in Appendix 1. The table in Appendix 2 lists,by theme, all changes to performance measures within the Draft Long-term Plan document withdetailed information on what has been changed.

    Significance of DecisionIt is possible that some of the decisions on this report may be significant but the decisions inherentin this budget will be fully consulted as part of the draft Long-term Plan 2012-2022.

    Maori Impact StatementIt is possible that some of the decisions from this report may be significant for Maori. Maori will beconsulted as part of the consultation process for the draft Long-term Plan 2012-2022.

    Consultation

    A formal consultation process will be undertaken for the draft Long-term Plan 2012-2022.

    Local Board ViewsThe draft plan was distributed to local boards in December. Feedback has been incorporatedwhere possible. A separate report is contained within the agenda for this meeting that outlinesprogress on draft local board agreement adoption.

    Financial and Resourcing ImplicationsThe costs involved in producing the long-term plan will be covered under the existing operationalbudgets of council.

    Legal and Legislative ImplicationsDecisions being made on this budget are being made in line with councils legislative obligations todevelop a long-term plan.

    Implementation IssuesThe changes detailed within this report have been incorporated into the draft Long-term Planpresented.

    Attachments

    No. Title Page

    A Significant performance measure changes 21

    B Performance measures change control 23

    SignatoriesAuthors Michael Burns, Principal Financial Advisor, Planning and PolicyAuthorisers Chris Carroll, Manager Planning and Policy

    Andrew McKenzie, Chief Finance Officer

  • 8/3/2019 AKL Council Strat and Finance Agenda 15.02.2012

    20/88

  • 8/3/2019 AKL Council Strat and Finance Agenda 15.02.2012

    21/88

    AttachmentA

    Item1

    0

    Strategy and Finance Committee15 February 2012

    Long-term Plan financials, policies and performance Page 21

  • 8/3/2019 AKL Council Strat and Finance Agenda 15.02.2012

    22/88

  • 8/3/2019 AKL Council Strat and Finance Agenda 15.02.2012

    23/88

    AttachmentB

    Item1

    0

    Strategy and Finance Committee15 February 2012

    Long-term Plan financials, policies and performance Page 23

  • 8/3/2019 AKL Council Strat and Finance Agenda 15.02.2012

    24/88

    AttachmentB

    Item10

    Strategy and Finance Committee15 February 2012

    Long-term Plan financials, policies and performance Page 24

  • 8/3/2019 AKL Council Strat and Finance Agenda 15.02.2012

    25/88

    Item1

    1

    Strategy and Finance Committee15 February 2012

    Rates Transition Management Policy alternative options Page 25

    Rates Transition Management Policy alternativeoptionsFile No.: CP2012/01159

    Executive SummaryThis report addresses concerns with the Rates Transition Policy as included in the draft Long-termPlan.

    One of the major issues arising from the formation of the Auckland Council is the introduction ofan integrated Rates policy. This will bring significant change to the majority of ratepayers. This isnot something any of us relish, but it is unavoidable. The policy options available to manage thetransition to the new system are limited by both the legislation and our legacy systems. Theoption we chose to include in the Long-term Plan during our deliberations late last year was thebest available within those constraints.

    In discussions with many of you, I have heard the concern that the transition policy as it standshas real limitations. On your behalf I followed up with officers over the Christmas break and theirwork has identified that relatively minor legislative change would enable more flexibility and, in myview, a fairer approach.

    This report seeks Councillors endorsement to set this change in process.

    Recommendation/sa) That the report be received.

    b) That the Strategy and Finance Committee endorse the Mayor requesting theMinister of Local Government to amend the legislation to allow the Council tolawfully consider the phased and capped approaches to rates transition.

    c) That the Strategy and Finance Committee authorise officers to work with theDepartment of Internal Affairs on the legislative changes required to address theconstraints of the existing rates transition legislation to enable the implementationof the phased and capped options.

    d) That the Strategy and Finance committee endorse the combined option of a 10%capped approach for residential, farm and lifestyle properties and a phasedapproach for business and that the Long-term Plan consultation material beupdated to reflect this option for public feedback.

    BackgroundDuring the draft LTP deliberations late last year, we debated at some length the options availableto us to manage the transition to the new rating system. The implementation of one rating systemfor the whole of Auckland is going to create significant change across Auckland. Approximately190,000 ratepayers will experience decreases under the proposed rates policy, another 120,000will experience increases between 0 and 10% and a further 190,000 increases over 10%.

    There was a desire across the board to ease the impacts of the change on those most affected byincreases. The options open to us were limited by both legislation and technical constraints andconsequently we approved an option which remitted rates to residential ratepayers with anincrease of over 15% (20% for business). There was still concern from many of you regarding:

    a) The cost of the remissions to all other ratepayers (approximately 3.6%); and

  • 8/3/2019 AKL Council Strat and Finance Agenda 15.02.2012

    26/88

    Item11

    Strategy and Finance Committee15 February 2012

    Rates Transition Management Policy alternative options Page 26

    b) 15% still being quite a high threshold of change.

    Since then, having considered those concerns that you raised I have asked officers to explorewhat legislative change would be required to find a more equitable option where those ratepayersreceiving significant increases had those offset against those experiencing decreases rather thanall ratepayers contributing to the remission.

    Decision MakingAttached is a full report from the officers setting out the options available to us, and the impacts ofthose options. In summary those options are:

    1. Remission policy this option is the currently approved approach and is incorporated in thedraft LTP as it currently stands. The approach is to limit residential properties to a 15% and$300 maximum increase (whichever is higher), farm and lifestyle properties to 15% and $500increase and business ratepayers to a 20% and $1000 increase (with a maximum remissionof $6000). It does not require any legislative change but does load the cost of theremissions on all ratepayers below the maximum limit.

    2. Phasing option this would spread the impact of both increases and decreases over threeyears. The advantage of this option is that it does offset the increases against the decreasesso that those with minimal change are not penalised by subsidising ratepayers withsignificant increases. However, those ratepayers with major increases will still get asignificant increase for each of the three years. We initially discounted this option astechnically our systems were unable to cope with this. As set out in the attached report, asmall change to the legislation would remove the technical difficulty.

    3. Capping option- this option would enable us to cap both the increases and decreases so thatthe decreases offset the increases. The attached report sets out the impacts of a 10% capfor residential and farm/lifestyle ratepayers and discusses the varying levels of cap forbusiness. There will be a residual issue after year 3 where approximately 25,000 residential,farm and lifestyle properties and 7500 business ratepayers will still be experiencingincreases over 10% in year 4. This option also requires a legislative change.

    Options 2 and 3 above have both been worked through on the basis of a three year transition.While in theory this could be a longer period, new valuations will be applied at that stage andcould over complicate a longer transition period.

    Legislative changeWhile amendments to legislation are required for the two new alternatives, this is quite feasible inthe timeframes. The Auckland Council legislation allows for amendments by Order in Councilwhich can be achieved in weeks rather than months. The capping option can be implementedunder the Order in Council for the first two years but will need a more substantive legislative

    change for year 3. There will be ample time to achieve this change.Way forwardHaving considered the officers advice I am of the view that a combination option may be the mostappropriate where we cap residential, farm and lifestyle ratepayers at 10% and phase in thechange for business. The spread of changes in the business sector is very wide and the cappingoptions are not optimal. For those 25,000 residential ratepayers who are still facing significantchange after 3 years, further consideration can be given to a remission policy at that time and inthe context of any changes from the revaluation.

    In order to achieve this approach we need to:(a) Seek the support of the Local Government Minister to start the process of an Order in

    Council in a timely manner; and(b) Highlight the alternatives proposed in the Long-term Plan consultation material.

  • 8/3/2019 AKL Council Strat and Finance Agenda 15.02.2012

    27/88

    Item1

    1

    Strategy and Finance Committee15 February 2012

    Rates Transition Management Policy alternative options Page 27

    Significance of DecisionAdoption of a rates transition management policy is a significant decision that requires use of thespecial consultative procedure. This will be undertaken in conjunction with the Long-term Plan2012-2022 process.

    Maori Impact StatementThe Independent Maori Statutory Board has been advised of the issues discussed in this report.

    ConsultationIssues associated with consulting on the options presented in this report have been included in theattached report for consideration.

    Local Board Views

    Local boards have not been consulted on this report.

    Financial and Resourcing ImplicationsThe phased and capped policy options set out in this report are designed to be cost neutral. Thiscompares to the current proposed remission transition management policy, which although it iscost neutral in terms of total revenue, increases the rate requirement by over three per cent.

    Legal and Legislative ImplicationsLegislative issues associated with implementing the options presented in this report have been

    included for consideration in the attached report.

    Implementation IssuesIssues associated with implementing the options presented in this report have been included forconsideration in the attached report.

    Attachments

    No. Title Page

    A Officer report on Rates Transition Policy alternatives.pdf 29B Appendices to that report.pdf 39

    SignatoriesAuthor Mayor Len Brown

  • 8/3/2019 AKL Council Strat and Finance Agenda 15.02.2012

    28/88

  • 8/3/2019 AKL Council Strat and Finance Agenda 15.02.2012

    29/88

    AttachmentA

    Item1

    1

    Strategy and Finance Committee15 February 2012

    Rates Transition Management Policy alternative options Page 29

  • 8/3/2019 AKL Council Strat and Finance Agenda 15.02.2012

    30/88

    AttachmentA

    Item11

    Strategy and Finance Committee15 February 2012

    Rates Transition Management Policy alternative options Page 30

  • 8/3/2019 AKL Council Strat and Finance Agenda 15.02.2012

    31/88

    AttachmentA

    Item1

    1

    Strategy and Finance Committee15 February 2012

    Rates Transition Management Policy alternative options Page 31

  • 8/3/2019 AKL Council Strat and Finance Agenda 15.02.2012

    32/88

    AttachmentA

    Item11

    Strategy and Finance Committee15 February 2012

    Rates Transition Management Policy alternative options Page 32

  • 8/3/2019 AKL Council Strat and Finance Agenda 15.02.2012

    33/88

    AttachmentA

    Item1

    1

    Strategy and Finance Committee15 February 2012

    Rates Transition Management Policy alternative options Page 33

  • 8/3/2019 AKL Council Strat and Finance Agenda 15.02.2012

    34/88

    AttachmentA

    Item11

    Strategy and Finance Committee15 February 2012

    Rates Transition Management Policy alternative options Page 34

  • 8/3/2019 AKL Council Strat and Finance Agenda 15.02.2012

    35/88

    AttachmentA

    Item1

    1

    Strategy and Finance Committee15 February 2012

    Rates Transition Management Policy alternative options Page 35

  • 8/3/2019 AKL Council Strat and Finance Agenda 15.02.2012

    36/88

    AttachmentA

    Item11

    Strategy and Finance Committee15 February 2012

    Rates Transition Management Policy alternative options Page 36

  • 8/3/2019 AKL Council Strat and Finance Agenda 15.02.2012

    37/88

    AttachmentA

    Item1

    1

    Strategy and Finance Committee15 February 2012

    Rates Transition Management Policy alternative options Page 37

  • 8/3/2019 AKL Council Strat and Finance Agenda 15.02.2012

    38/88

    AttachmentA

    Item11

    Strategy and Finance Committee15 February 2012

    Rates Transition Management Policy alternative options Page 38

  • 8/3/2019 AKL Council Strat and Finance Agenda 15.02.2012

    39/88

    AttachmentB

    Item1

    1

    Strategy and Finance Committee15 February 2012

    Rates Transition Management Policy alternative options Page 39

  • 8/3/2019 AKL Council Strat and Finance Agenda 15.02.2012

    40/88

    AttachmentB

    Item11

    Strategy and Finance Committee15 February 2012

    Rates Transition Management Policy alternative options Page 40

  • 8/3/2019 AKL Council Strat and Finance Agenda 15.02.2012

    41/88

    AttachmentB

    Item1

    1

    Strategy and Finance Committee15 February 2012

    Rates Transition Management Policy alternative options Page 41

  • 8/3/2019 AKL Council Strat and Finance Agenda 15.02.2012

    42/88

    AttachmentB

    Item11

    Strategy and Finance Committee15 February 2012

    Rates Transition Management Policy alternative options Page 42

  • 8/3/2019 AKL Council Strat and Finance Agenda 15.02.2012

    43/88

    AttachmentB

    Item1

    1

    Strategy and Finance Committee15 February 2012

    Rates Transition Management Policy alternative options Page 43

  • 8/3/2019 AKL Council Strat and Finance Agenda 15.02.2012

    44/88

    AttachmentB

    Item11

    Strategy and Finance Committee15 February 2012

    Rates Transition Management Policy alternative options Page 44

  • 8/3/2019 AKL Council Strat and Finance Agenda 15.02.2012

    45/88

    AttachmentB

    Item1

    1

    Strategy and Finance Committee15 February 2012

    Rates Transition Management Policy alternative options Page 45

  • 8/3/2019 AKL Council Strat and Finance Agenda 15.02.2012

    46/88

    AttachmentB

    Item11

    Strategy and Finance Committee15 February 2012

    Rates Transition Management Policy alternative options Page 46

  • 8/3/2019 AKL Council Strat and Finance Agenda 15.02.2012

    47/88

    Item1

    2

    Strategy and Finance Committee15 February 2012

    Maori Outcomes and Associated Budgets Page 47

    Maori Outcomes and Associated BudgetsFile No.: CP2012/01289

    Executive Summary

    The Strategy and Finance Committee has considered a number of reports on Maori outcomesrecommended by the Independent Maori Statutory Board resulting in their inclusion in the draftLong Term Plan 2012 2022 with associated measures and targets.This report provides an update on the review of activity budgets to assess the extent to which theycontribute to Maori outcomes and the activities set out in the Independent Maori Statutory Boardsbudget proposals.

    The Independent Maori Statutory Board considered that the funding allocated for achieving Maorioutcomes was insufficient and it recommended that expenditure proposals of $295.23 million over10 years be included on the draft Long Term Plan.

    The report responds to the following resolutions of the Finance and Strategy Committee on 16December 2011:

    c) That the Strategy and Finance Committee note that council officers and the IndependentMaori Statutory Board secretariat will continue to work through December and Januarywith activity managers and relevant Council Controlled Organisations to identify:

    i. programs and projects included in the draft Long-Term Plan 2012-2022 budgets,which contribute to Maori outcomes, and

    ii. programs and projects which have not yet been fully scoped but have the potentialto contribute or be re-prioritised to contribute to the achievement of Maorioutcomes.

    d) That this work be reported back in February when the Governing Body is considering theadoption of the draft Long-Term Plan 2012-2022 for public consultation.

    The budget review has involved working with the relevant activity managers and finance staff to

    identify activities which contribute to Maori outcomes and benefit Maori.The review has identified what is currently captured within existing budgets as well as projectswithin the plan which have not yet been fully scoped but have the potential to achieve Maorioutcomes or be reprioritised to that effect.The information supplied by Council departments and Council Controlled Organisations can begrouped into five main categories:

    1. Specific projects and programs that contribute to a Maori outcome.2. Staff resource and general overheads that contribute to a Maori outcome.

    3. Projects, programs and activity where a general allocation has been made based onassumptions on the benefit to Maori generally.

    4. Projects identified but not budgeted.5. General contributions to Maori outcomes not identified.

    A list of projects and staff time contributing to Maori outcomes is contained in the attachmentstogether with a list projects that have the potential to contribute to Maori outcomes with furtherscoping. The overall budget estimates specific to Maori outcome areas are:

    Budget Estimates (10 years) for Maori Outcomes and Activities

    Outcome Area Budget estimate

    Kaitiakitanga 14.4 million

    Whi tapu 71k

  • 8/3/2019 AKL Council Strat and Finance Agenda 15.02.2012

    48/88

    Item12

    Strategy and Finance Committee15 February 2012

    Maori Outcomes and Associated Budgets Page 48

    Mauri of ancestral lands and waters

    Rangatiratanga /self determination 31.1 million

    Te Tiriti o Waitangi

    ritetanga 4.8 million

    Mana of Tamaki Makaurau iwi and hap

    Mtauranga Mori - Mori knowledge

    Total of all Outcomes 50.37 million

    In addition, there is budget expenditure of $54 million for the Maori Strategy and Relations Unit,$23 million for the Independent Maori Statutory Board and $96.75 million for projects, programsand activity of benefit to Maori generally. This expenditure has not been allocated to a specificoutcome as it covers a number of outcomes or for projects it is difficult to determine from theinformation provided whether the activity contributes to a specific outcome.

    There are some gaps in the budget information where project work, programs and activities whichcontribute to specific outcomes are being undertaken by the Council and Council controlledorganisations that are not explicit in the budget information gathered. Examples include wahi tapuinvestigation and protection, environmental protection and enhancement, water qualityimprovements, iwi engagement and participation at a project level.

    It should be noted that as the Long Term Plan is in draft the budgets are based on currentestimates and broad assumptions by relevant activity managers to determine whether an activitymakes a contribution to Maori outcomes. These have not been reviewed at a detailed project byproject level.

    This information will be incorporated as appropriate in the finalisation of the draft Long Term Plan,adopted by the Governing Body in February.

    In addition to this work, a report to be prepared by the Independent Maori Statutory Boardsecretariat and council officers in April 2012 will recommend improvements to the Long Term Planpolicy and budgeting process to ensure responsiveness to Maori outcomes.

  • 8/3/2019 AKL Council Strat and Finance Agenda 15.02.2012

    49/88

    Item1

    2

    Strategy and Finance Committee15 February 2012

    Maori Outcomes and Associated Budgets Page 49

    Recommendation/sa) That this report and attachments be received.

    b) That the Finance & Strategy Committee notes that budget expenditure of $50.37million has been identified by activity managers and finance staff that directlycontributes to Maori outcomes over the ten year period of the LTP.

    c) That the Finance & Strategy Committee notes that in addition $54 million isallocated to the Maori Strategy and Relations Unit, $23 million to the IndependentMaori Statutory Board and $96.75 million of budget expenditure has beenidentified as being of general benefit to Maori over the ten year period of the LTP.

    d) That the Finance & Strategy Committee notes that projects, programs and activitieshave been identified that currently have no funding attached or have not yet beenplanned to a level of detail to allow the contributions to Maori Outcomes to bequantified

    e) That the Strategy and Finance Committee note that council officers and theIndependent Maori Statutory Board secretariat will report back in April on possibleimprovements to the Long Term Plan policy and budgeting processes as they relateto Maori outcomes.

    f) The council officers in consultation with the Independent Maori Statutory Boardsecretariat develop guidelines to assist managers better identify and record howprograms and projects contribute to Maori Outcomes.

    BackgroundOn 30 November 2011 the Strategy and Finance Committee considered the report IndependentMaori Statutory Board Strategic and Budget review on the Long Term Plan. The report

    recommended an approach to integrate the Independent Maori Statutory Board Maori outcomesinto the Long Term Plan 2012 2022. The Committee resolved:

    a) That a further report be prepared for the Strategy and Finance Committee meeting on 16December 2011 containing:

    i. recommended amendments to the draft LTP documentation in order toaccommodate the initial set of Maori outcomes recommended by the IndependentMaori Statutory Board together with associated performance measures and targets

    ii. an assessment of the extent to which the budget estimates contained in the updatereport are, or can be, accommodated within budgets already approved for inclusionwithin the draft LTP

    b) That engagement with Maori of Tamaki Makaurau on Maori outcomes be undertaken inconjunction with the special consultative procedure on the draft LTP

    c) That council officers in conjunction with the Independent Maori Statutory Board secretariatreport back to the Independent Maori Statutory Board and the Strategy and FinanceCommittee in April 2012 on planned improvements to the long term policy and budgetingprocess to ensure responsiveness to Maori.

    d) That the Strategy and Finance Committee agree that the draft Long Term Plan 2012 2022 document includes details on the Long Term Plan suggested budget for Maorioutcomes including explanation of existing budget but that the draft LTP budget not beamended to include additional the additional expenditure

    A further report was considered by the Committee on 16 December which detailed that the Maorioutcomes recommended by Independent Maori Statutory Board had been included (with somemodification) in the Long-Term Plan with associated measures and targets. The report further

  • 8/3/2019 AKL Council Strat and Finance Agenda 15.02.2012

    50/88

    Item12

    Strategy and Finance Committee15 February 2012

    Maori Outcomes and Associated Budgets Page 50

    advised the Committee that officers were continuing to gather financial information at theprogramme and project level to assess the extent to which existing budgets contribute to Maorioutcomes or may be re-prioritised or allocated to that purpose. The Committee resolved that:

    a) That the Strategy and Finance Committee note that Maori outcomes recommended by theIndependent Maori Statutory Board are now included in the Long Term Plan overviewchapter as part of a list of community outcomes and the theme/activity chapters where a

    section explains briefly how the activities are contributing to the Maori outcomes and insome cases including measures and targets.

    b) That the Strategy and Finance Committee note that council officers and the IndependentMaori Statutory Board secretariat will continue to work through December and Januarywith activity managers and relevant Council Controlled Organisations to identify:

    i. programs and projects included in the draft Long-Term Plan 2012-2022 budgets,which contribute to Maori outcomes, and

    ii. programs and projects which have not yet been fully scoped but have the potentialto contribute or be reprioritised to contribute to the achievement of Maori outcomes.

    c) That this work be reported back in February when the Governing Body is considering theadoption of the draft Long-Term Plan 2012-2022 for public consultation.

    This report sets out the findings of the budget review.

    LTP Budget Review

    The LTP budget review has assessed the draft LTP budgets to identify expenditure thatcontributes to Maori outcomes at a program and project level. In addition the review has sought toidentify activities or projects that have not been scoped but have the relevance and potential to bescoped and reprioritised to meet Councils Maori strategic direction for Maori or Maori outcomes.

    This work is generally reported at a high level and may require further work.The assessment of expenditure has considered whether an activity or project meets a Maorioutcome through its definition and measures including Maori values, Kaupapa Maori orMatauranga Maori considerations; whether it has existing clear objectives and measurespertaining to Maori outcomes; and whether it has a significant level of participation by Maori.

    The set of Maori outcomes and their description are detailed below:

    a) Kaitiakitanga - Tangata whenua are empowered, enabled, respected and recognised intheir customary kaitiaki role

    b) Whi Tapu - Whi tapu within the Auckland Region are protected

    c) Rangatiratanga - Tamaki Makaurau hap and iwi exercise rangatiratanga /selfdetermination

    d) Te Tiriti - The Treaty of Waitangi is appropriately recognised and given effect to

    e) Mana tangata / ritetanga - Mori are empowered and enjoy high quality lives

    f) Mauri - The mauri of ancestral lands and waters are in optimum health

    g) Mtauranga Mori - Mtauranga Mori, including Mori knowledge and world views, isrespected, and its validity and value acknowledged

    h) Mana Whenua - The mana of Tamaki Makaurau iwi and hap is appropriately respected

  • 8/3/2019 AKL Council Strat and Finance Agenda 15.02.2012

    51/88

    Item1

    2

    Strategy and Finance Committee15 February 2012

    Maori Outcomes and Associated Budgets Page 51

    Budget Review Findings

    In response, council staff has produced a set of budget estimates based on assumptions of thebenefit to Maori outcomes. The information supplied by Council departments and CouncilControlled Organisations can be grouped into five main categories:

    1. Specific projects and programs that contribute to a Maori outcome.

    The information supplied identifies specific activities that can be directly attributed toachieving Maori outcomes (based on a description of the activity). A list of projects andprograms that contribute to Maori outcomes is attached as Attachment One.

    2. Staff resource and general overheads that contribute to a Maori outcome.

    A number of departments and some Council Controlled organisations have identifieddedicated staff resource that contributes to projects and programs of benefit to Maori orare involved in consultation and engagement with Maori. In some cases this relates to fulltime positions and in other cases it relates to a portion of the staff members time.

    Generally this has been allocated as a general overhead cost. A list of staff resource that

    contributes to Maori outcomes is attached at Attachment One.3. Projects, programs and activity where a general allocation has been made based on

    assumptions on the benefit to Maori generally.

    There are a number of projects, programs and activity where a general allocation has beenmade based on an assumption that they benefit the Maori population generally. It isdifficult to determine from the information provided whether these activities contribute to aspecific Maori outcome and make a contribution to achieving the outcome rather thanbenefiting the Maori population generally. For this reason, this expenditure has not beenallocated against a specific outcome but has been included as a general allocation. Anexample of this is councils capital expenditure on stormwater infrastructure works.

    4. Projects identified but not budgeted or which could be re-prioritised.There are some examples of projects that have been included within draft budgets thathave no funding attached. In some cases these projects could make a contribution toMaori outcomes.

    5. General contributions to Maori outcomes not identified.

    There are some instances where projects have been included within departmental andCouncil Controlled organisation budgets but they have not currently been planned to alevel of detail that enables budget expenditure that contributes to Maori outcomes to bequantified. Examples of this include transport and infrastructure projects that include Maoriengagement, participation and works to address Maori cultural values. These are listed in

    Attachment Two.

    Budget Estimates by Outcome

    Projects, programs and activity expenditure (including staff resource) that contributes to Maorioutcomes have been quantified based on the information provided. Expenditure that has beenidentified as contributing to Maori generally has been itemised separately.

    There are some projects that have been identified that have no current budget attached or are notwell advanced in their planning to be able to accurately identify budget expenditure thatcontributes to Maori outcomes. These projects have been identified and could be the subject of

    further scoping work.

  • 8/3/2019 AKL Council Strat and Finance Agenda 15.02.2012

    52/88

    Item12

    Strategy and Finance Committee15 February 2012

    Maori Outcomes and Associated Budgets Page 52

    Improvements to the LTP Policy and Budgeting Processes

    One of the purposes of the review is to identify proposed areas for improvement for the Long TermPlan Policy and Budgeting Processes.

    All information relating to budgets, measures and outcomes including additional informationobtained through the special consultative procedure will inform the report that is to be prepared by

    Council officers and the Independent Maori Statutory Board secretariat due in April 2012 withrespect to future process improvements.

    Decision MakingThe recommendations contained within this report fall within the committees delegated authority.

    Significance of DecisionThe subject matter of this report will be reflected in the draft LTP 2012 2022 which is subject tothe special consultative procedure.

    Maori Impact Statement

    All aspects of this report are of particular significance to the identification and achievement ofMaori outcomes.

    ConsultationThe subject matter of this report will be reflected in the draft LTP 2012 - 2022 which is subject tothe special consultative procedures.

    Local Board ViewsThe views of local boards have not been sought on the contents of this report.

    Financial and Resourcing ImplicationsThe financial and resourcing implications are detailed in the report and will be included in the draftLTP 2012 2022.

    Legal and Legislative ImplicationsCouncil has specific obligations under various pieces of legislation. These are summarised in partthree of the report in attachment one.

    Implementation IssuesThe information contained in this report will be included in the draft Long Term Plan 2012 - 2022which is released for public consultation. Further process improvement opportunities will be

    reported back to the committee in April 2012.

    Attachments

    No. Title Page

    A Projects identified for further scoping 53

    SignatoriesAuthor Grant Taylor, Governance Director

    Authorisers Roger Blakeley, Chief Planning OfficerAndrew McKenzie, Chief Finance Officer

  • 8/3/2019 AKL Council Strat and Finance Agenda 15.02.2012

    53/88

    Strategy and Finance Committee15 February 2012

    Maori Outcomes and Associated Budgets

  • 8/3/2019 AKL Council Strat and Finance Agenda 15.02.2012

    54/88

    AttachmentA

    Item1

    2

    Strategy and Finance Committee15 February 2012

    Maori Outcomes and Associated Budgets

  • 8/3/2019 AKL Council Strat and Finance Agenda 15.02.2012

    55/88

    Strategy and Finance Committee15 February 2012

    Maori Outcomes and Associated Budgets

  • 8/3/2019 AKL Council Strat and Finance Agenda 15.02.2012

    56/88

  • 8/3/2019 AKL Council Strat and Finance Agenda 15.02.2012

    57/88

    Item1

    3

    Strategy and Finance Committee15 February 2012

    Long Term Plan Local Board Issues Page 57

    Long Term Plan Local Board IssuesFile No.: CP2012/01204

    Executive Summary

    The Committee considered a number of local board issues when making decisions on the draftLong-term Plan (LTP) in November 2011. At this meeting, the Committee noted that local boardshave sought to re-prioritise their budgets to remain within their proposed 10-year fiscal envelopes.While many local boards have been able to accommodate their activities within their existingbudgets, not all local boards have been able to achieve this.

    The Committee noted that local boards currently have no budget allocated for local economicdevelopment or local environmental initiatives and limited budgets for local events and localcommunity development initiatives and requested officers to report back on any proposedreallocation of regionally allocated budgets in these areas to local boards. It also noted that aslocal board budgets are generally based on historical decisions of legacy councils, there aresignificant variances in the level of discretionary budget available to local boards.

    Further work on the local board 10-year budgets will continue alongside the consultation processfor the finalisation of the local board agreements, and where necessary appropriate disclosureswill be made in the draft local board agreements.

    The Committee resolved to approve the revised allocation of non-regulatory decision-makingresponsibilities to the Governing Body and local boards for inclusion in the draft Long-term Plan. Itnoted that further work was being undertaken on the parks and town centres allocation and thatthis would be completed in time for approval of the final draft of the Long-term Plan in February2012. The review of the parks allocation is contained in a separate report to this Committee.

    The town centres allocation has been reviewed and alignment with the aims and objectives of the

    Auckland Plan has been confirmed. It is recommended though, that the current reference tobanners and signage in local streets and town centres for regional community events in thegoverning body allocation be removed from this part of the allocation. The Governing Body isallocated decision-making for regional events, which includes all activity involved in delivery, suchas marketing.

    The proposed decision-making allocation also allocates the responsibility to the Governing Body ina number of situations for the development of regional programmes (such as environmental,community development, recreation and economic development programmes), which can then betailored to local needs by local boards. It is proposed that this approach be added to the areas ofevents and arts and culture. It recognises the benefit of a regional framework and overarchingconsistency of approach while also allowing for specific tailoring to local communities.

    Local boards are meeting during late January/ early February to approve their draft Local BoardAgreements for 2012-2013. At the time of writing this report, ten of the 21 local boards haveapproved their draft agreements. An update on the status of the remaining draft agreements,along with the agreement documents, will be tabled at the Committee meeting.

  • 8/3/2019 AKL Council Strat and Finance Agenda 15.02.2012

    58/88

    Item13

    Strategy and Finance Committee15 February 2012

    Long Term Plan Local Board Issues Page 58

    Recommendation/sa) That the report be received.

    b) That the Strategy and Finance Committee:.

    i) Notes that further work on the prioritisation of local board 10-year budgets

    will continue alongside the consultation process for the finalisation of thelocal board agreements, and where necessary appropriate disclosures willbe made in the draft local board agreements.

    ii) Approves the deletion of banners and signage in local streets and towncentres for regional community events from draft allocation of non-regulatory decision-making to the governing body.

    iii) Approves the inclusion of the development of regional programmes forevents and arts and culture, which can then be tailored to local needs bylocal boards" in the draft allocation of non-regulatory decision-makingallocation to the governing body .

    iv) Notes that to date, ten local boards have approved their draft local boardagreements. The remaining local boards are meeting before the Committeeconsiders this report. An update on the status of the draft local boardagreements will be provided at the meeting.

    BackgroundThe Committee considered a number of local board issues when making decisions on the draftLong-term Plan in November 2011. Outstanding issues are discussed below.

    Decision MakingLocal board budgets

    In November, the Committee noted that

    i) Local boards have sought to re-prioritise their budgets to remain within theirproposed 10-year fiscal envelopes.

    ii) While many local boards have been able to accommodate their activitieswithin their existing budgets, not all local boards have been able to achievethis.

    iii) Some local boards will require further financial information and support inorder to complete the reprioritisation exercise.

    The Committee also noted that local boards currently have no budget allocated for local economicdevelopment or local environmental initiatives and limited budgets for local events and localcommunity development initiatives and requested officers to report back to the Governing Body onany proposed reallocation of regionally allocated budgets in these areas to local boards. Work isunderway to consider this but it will not be completed in time for the release of the draft Long-termPlan for consultation.

    The Committee also noted that as local board budgets are generally based on historical decisions

    of legacy councils, there are significant variances in the level of discretionary budget available tolocal boards. This issue is being considered as part of the approach to the longer-term localboards funding policy, including any appropriate recommendations, but again will not becompleted in time for the release of the draft Long-term Plan for consultation.

  • 8/3/2019 AKL Council Strat and Finance Agenda 15.02.2012

    59/88

    Item1

    3

    Strategy and Finance Committee15 February 2012

    Long Term Plan Local Board Issues Page 59

    Where necessary appropriate disclosures will be made in the draft local board agreements, andfurther work will continue alongside the consultation process for the finalisation of the local boardagreements.

    Allocation of non-regulatory decision-making

    At its meeting in November the Committee resolved to approve the revised allocation of non-regulatory decision-making responsibilities to the Governing Body and local boards for inclusion inthe draft Long-term Plan. It noted that further work was being undertaken on the parks and towncentres allocation and that this would be completed in time for approval of the final draft of theLong-term Plan in February 2012.

    The proposed town centres allocation, as contained in the draft reported to the Committee inNovember, is as follows:

    Activity Local Board non-regulatoryresponsibilities Governing Body non-regulatoryresponsibilities

    Streetenvironmentand towncentres

    Local street environment and towncentres including: maintenance of the local street

    environment and local centres,within parameters set by thegoverning body where it relatesto the centres prioritised forgrowth as set out in the AucklandPlan

    improvements to the local street

    environment and town centresexcluding any improvements thatare integral to a transformationprogramme for the centresprioritised for growth as set out inthe Auckland Plan

    naming of roads pursuant tosection 319(j) of the LocalGovernment Act 1974

    City transformation including: street environment and town

    centres strategy and policy,including the classification of towncentres

    transformation programmes for thecentres that are prioritised forgrowth as set out in the AucklandPlan

    banners and signage in localstreets and town centres forregional community events

    This has been reviewed and alignment with the aims and objectives of the Auckland Plan hasbeen confirmed. Once the Auckland Plan is finalised, the centres that are prioritised for growthwill be listed in a schedule and an explanatory note will be included highlighting that other partieswill be involved in the delivery of these transformation programmes. It is recommended though,that the reference to banners and signage in local streets and town centres for regionalcommunity events in the governing body allocation be removed. The Governing Body is allocateddecision-making for regional events, which includes all activity involved in delivery, such asmarketing.

    The proposed decision-making allocation also allocates the responsibility to the Governing Body ina number of situations for the development of regional programmes, which can then be tailored to

    local needs by local boards. This includes areas such as environmental, community development,recreation and economic development programmes. It would be helpful, for the purposes ofclarification, to specifically extend this approach to areas such as events where for example, theGoverning Body could develop a regional programme for an event like movies in the parks, which

  • 8/3/2019 AKL Council Strat and Finance Agenda 15.02.2012

    60/88

    Item13

    Strategy and Finance Committee15 February 2012

    Long Term Plan Local Board Issues Page 60

    could then be specifically tailored to local needs by the local boards. It recognises the benefit of aregional framework and overarching consistency of approach while also allowing for specifictailoring to local communities. It is proposed that this approach be added to the areas of eventsand arts and culture.

    The review of the parks allocation is contained in a separate report to this Committee.

    Local board agreements

    Local boards are meeting during late January/ early February to approve their draft Local BoardAgreements for 2012-2013. The draft agreements reflect the priorities in each local boards LocalBoard Plan. The draft agreements include the intended provision of local activities and the capitaland operating expenditure required to fund these activities. The draft agreements must beincluded in Auckland Councils draft Long-Term Plan.

    At the time of writing this report, ten of the 21 local boards have approved their draft agreements.An update on the status of the remaining draft agreements, along with the agreement documents,will be tabled at the Committee meeting.

    The final local board agreements will form part of the final Long-term Plan. The final agreementwill take into account the submissions and hearings for the special consultative procedure. Thefinal agreement will also be subject to discussion and negotiation between the Governing Bodyand the relevant local board.

    Significance of DecisionThis is a significant decision as it forms part of the development of the Long-term Plan.

    Maori Impact StatementThere are many decisions of local boards that are of importance to Maori and there is a need tocontinue to build relationships between local boards and relevant iwi. The relationship betweenlocal boards and iwi is an important component of the Auckland Council governance model.

    ConsultationN/A

    Local Board Views

    N/A

    Financial and Resourcing ImplicationsN/A

    Legal and Legislative ImplicationsN/A

    Implementation IssuesN/A

  • 8/3/2019 AKL Council Strat and Finance Agenda 15.02.2012

    61/88

    Item1

    3

    Strategy and Finance Committee15 February 2012

    Long Term Plan Local Board Issues Page 61

    AttachmentsThere are no attachments for this report.

    Signatories

    Au