Philip Jacobs

I would like to thank Andrew Broxholme for entering the discussion (Beacon, June 19) about the Whakatāne District Council’s ongoing operating deficits and ballooning debt.

I make one correction – I understand that current council debt is only about $200 million.

But it is the case that council expects its debt in 2034 to be about $365 million and there is another $160 million of additional capital works expenditure planned immediately thereafter.

Check it out on pages 129 and 213 of the council’s Water Services Delivery Plan.

Anyone who thinks all this spending and borrowing is not their concern should check out the council’s proposed annual wastewater (sewerage) charge of $2105 for the 2033/34 year (in 2025 dollars, so add 25 percent for inflation) on page 110 of the Water Services Delivery Plan.

That (and hundreds of dollars more) will be an unpleasant surprise for Matatā residents when their proposed sewerage scheme is finally commissioned in the mid-to-late 2030s.

If we as ratepayers and voters, and our elected council, do not do something soon, our council debt will be $500 million before we know it.

I think Andrew is being a bit disingenuous to our elected council. They are not finance experts and they are certainly not getting all the relevant information before them to galvanise them into action.

It is just a shame that the district does not have some seriously concerned accountant councillors screaming from rooftops about council finances.

That said, councils cannot avoid all responsibility for wasting $5 million on the boat harbour project, launching the Edgecumbe to Thornton cycleway project without access to all the land, spending $14 million refurbishing the civic centre and spending maybe $10 million preparing for the Matatā Sewerage Scheme without an approved business case, having resolved funding, or consultation with the district-wide community, which will pay hundreds a year in rates increases to operate it.

As for local government reform (amalgamation) – that will only exacerbate the problem by further distancing concerned ratepayers from larger sub-regional or regional elected councils, with at least Ōpōtiki and Kawerau acquiring the dubious privilege of sharing Whakatāne’s financial burdens.

I agree with Andrew that a $10 million a year reduction in council spending (including staff cuts) must be imposed over the next few years to eliminate the operating deficit.

That was my plan as prospective mayor, and I fully intended to go further by another $10 or $20 million to create an operating surplus to commence debt repayment.

Regarding debt repayment, I note the words “How debt is being reduced” in a Whakatāne District Council advertisement on page 3 (Beacon, June 19).

Those words are typical council smoke and mirrors – council is not reducing debt, just slowing the rate of increase in debt by a paltry amount. Five hundred million of debt is still over the horizon in 10 to 12 years.

Until the council announces a formal programme and commitment to reduce its total debt levels then I and others will keep highlighting its appalling financial management culture in our ongoing pursuit of future rates affordability absent of massive loan interest charges and repayment obligations.