Ratepayers suffer for council follies
Paddy Lewis
HERE’S the deal: a number of people (let’s say, for argument’s sake, 10) from varying backgrounds get together around a table once a month where they are presented with reports by a bunch of other people paid to produce such reports.
This varied group, which might include (again, hypothetically) a cross-section of the public – such as a lawyer, a publican, a small business owner, a public servant, a teacher, and a sales rep – has to make decisions on the reports put before them.
Not being privy to all the information all the time (because the people writing the reports say it’s “commercially sensitive”) they have to make a call based on the advice they are given. Sometimes they can make external enquiries of their own, but more often than not they’re working on someone else’s recommendation.
That’s essentially what happened to the Hamilton City Council, now in a $40 million hole because of the soon to be canned V8 street racing. Audit NZ slammed the decision-making process in a report that will see no-one fined, no-one jailed, but all Hamilton ratepayers coughing up for it.
It is not just that. Hamilton has 100% debt-funded the new Claudelands Events Centre at a cost of $68 million. The proposals council decided on said the centre would host over 300 events per year (in direct competition with the privately-owned Mystery Creek). Now it has opened, that’s been revised to just over 150 and the centre will have an operating deficit of $1.7 million in its first year – funded by ratepayers.
But wait – there’s more. Remember the multi-million dollar upgrade of Hamilton’s Seddon Park in 2002 that spectacularly failed leading to the pitch being flooded and having to be replaced with another $500,000 upgrade? Again – council-funded by the poor old ratepayers.
Then there’s Waikato Stadium, another black hole for money where the Waikato Rugby Union owes millions in rental alone.
Providing recreational facilities is a core council business. But as we can see from the Hamilton basket case, there is a time for a clear line in the sand over expenditure. Council staff and elected representatives have been shown time and again not to be the best judges of such massive infrastructure and events expenditure. Hamilton sport is going to suffer because with debt of about $445 million, the council is cutting expenditure on, amongst other things and ironically, sports fields.
Councils up and down the country don’t seem to be subject to the rules of others. Say a company decided it was going to build an events centre and the whole business plan went belly-up, they would be liquidated and potentially bankrupted. A local authority just shrugs its collective shoulders and adds another x per cent to the following year’s rates bill. The debacle that is the Hamilton City Council’s foray into sporting event management and venue acquisition will mean no more than a couple of people losing their jobs and improvements to council’s core businesses (like recreational opportunities) getting sidelined.
The whole thing comes down to not only a lack of good planning, but the gross abuse of the Local Government Official Information and Meetings Act, which removes events such as the V8s from proper public scrutiny. Sure, there has to be an element of commercial sensitivity to negotiations, but not a complete blanket.
It’s not just Hamilton. Cities up and down the country are throwing money at sporting events to attract them to their patch. In the end, it’s the ratepayers who suffer – through increased rates and cuts to their own recreational opportunities. All for the sake of a little sunlight…
This varied group, which might include (again, hypothetically) a cross-section of the public – such as a lawyer, a publican, a small business owner, a public servant, a teacher, and a sales rep – has to make decisions on the reports put before them.
Not being privy to all the information all the time (because the people writing the reports say it’s “commercially sensitive”) they have to make a call based on the advice they are given. Sometimes they can make external enquiries of their own, but more often than not they’re working on someone else’s recommendation.
That’s essentially what happened to the Hamilton City Council, now in a $40 million hole because of the soon to be canned V8 street racing. Audit NZ slammed the decision-making process in a report that will see no-one fined, no-one jailed, but all Hamilton ratepayers coughing up for it.
It is not just that. Hamilton has 100% debt-funded the new Claudelands Events Centre at a cost of $68 million. The proposals council decided on said the centre would host over 300 events per year (in direct competition with the privately-owned Mystery Creek). Now it has opened, that’s been revised to just over 150 and the centre will have an operating deficit of $1.7 million in its first year – funded by ratepayers.
But wait – there’s more. Remember the multi-million dollar upgrade of Hamilton’s Seddon Park in 2002 that spectacularly failed leading to the pitch being flooded and having to be replaced with another $500,000 upgrade? Again – council-funded by the poor old ratepayers.
Then there’s Waikato Stadium, another black hole for money where the Waikato Rugby Union owes millions in rental alone.
Providing recreational facilities is a core council business. But as we can see from the Hamilton basket case, there is a time for a clear line in the sand over expenditure. Council staff and elected representatives have been shown time and again not to be the best judges of such massive infrastructure and events expenditure. Hamilton sport is going to suffer because with debt of about $445 million, the council is cutting expenditure on, amongst other things and ironically, sports fields.
Councils up and down the country don’t seem to be subject to the rules of others. Say a company decided it was going to build an events centre and the whole business plan went belly-up, they would be liquidated and potentially bankrupted. A local authority just shrugs its collective shoulders and adds another x per cent to the following year’s rates bill. The debacle that is the Hamilton City Council’s foray into sporting event management and venue acquisition will mean no more than a couple of people losing their jobs and improvements to council’s core businesses (like recreational opportunities) getting sidelined.
The whole thing comes down to not only a lack of good planning, but the gross abuse of the Local Government Official Information and Meetings Act, which removes events such as the V8s from proper public scrutiny. Sure, there has to be an element of commercial sensitivity to negotiations, but not a complete blanket.
It’s not just Hamilton. Cities up and down the country are throwing money at sporting events to attract them to their patch. In the end, it’s the ratepayers who suffer – through increased rates and cuts to their own recreational opportunities. All for the sake of a little sunlight…
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