Balancing the Budget

The Financial Strategy guides Council decisions on prudent, long term funding and the Infrastructure Strategy identifies the significant issues the Council faces within the next 10 to 30 years and how it intends to manage assets like water, wastewater, stormwater and community facilities.

HOW COUNCIL FUNDS ITS OPERATIONAL ACTIVITIES

Each year’s operating income is set to meet that year’s operating expenses so that the Council has a balanced budget. It is expected operating expenditure will increase from $91.9 million in 2018/19 up to $120.1 million in 2027/28 due to projected population growth, increases in service levels and inflation adjustments.

OperatingExpenditure

The draft Long Term Plan 2018-2028 Funding Impact Statement (FIS) provides a more complete picture of what we’re spending money on and how it is funded.

COUNCIL CAPITAL EXPENDITURE PROGRAMME

Over the next 10 years the Council will spend approximately $429 million on infrastructure renewals, improved levels of service and accommodating growth.

ProposedCapitalExpenditure_Graph

ProposedFundingOfCapitalExpenditure_Graph

DEBT LEVELS

Total debt is forecast to reach $203 million in 2027/28, peaking at $218 million in 2020/21.

In the first 3 years of the Long Term Plan, our debt levels are projected to rise by $50 million to fund some significant capital projects related to improved levels of service and accommodating growth.

Debt levels remain within the Local Government Funding Agency (LGFA) policy limit agreements, even after we’ve allowed for financial capacity or ‘headroom’ to pay for a rebuild programme should a significant disaster occur within this 10 year plan. If an event occurred, the Council would reprioritise the current and future work programme to ensure it remained within its policy limit.

As a member of the LGFA and with an AA credit rating from Standard and Poor’s, we achieve a lower cost of funding debt than through conventional lending institutions.

TotalDebt

RATES AFFORDABILITY

RatesAffordability

RatesIncreases

These graphs compare actual proposed rate increases with the quantified limit on rate increases included in our Financial Strategy. The quantified limit includes the Consumer Price Index (CPI), Earthquake Recovery Rate increases, allows for future growth in the District and increases for levels of service.