Ashburton District Council

The Council's Annual Report is one of the main documents it is required to produce each year that outlines its financial performance in detail. Our latest Annual Report for the 2014/15 financial year was adopted by Council at the end of October. We recorded a surplus of $9.5m before taxation and other comprehensive income. The Annual Report received an unqualified audit opinion. Financial benchmarks are good indicators of how well any business is being managed. Council is no exception. Ratepayers are now also able to keep a closer eye on the Council's financial position by looking at how we performed against seven mandatory benchmarks. The benchmarks address three elements of financial prudence - affordability, sustainability and predictability. This is the second year that councils throughout New Zealand have been required to publish their financial prudence results, in the prescribed format, in their Annual Reports. The Government introduced the new regulations in 2014 to help promote more informed public debate about local authority financial management. This year Ashburton District Council reported that it has met all of its key benchmarks. While Council's total debt at $47.5m is higher than what has been in previous years, this increase was planned for and reflects our continued investment in core infrastructure. The Council's debt actually sits well below its debt limits. We borrow far less that what we could, and our current borrowings are actually 30% less than what we had projected. We set our benchmark for our loan interest costs to be no more than 10% of our revenue and we currently sit well below this it at 4.4%. Our cash flow is extremely good. At 30 June 2015 we were at 140.1% of what we projected. This means that Council received sufficient cash to meet its operating expenditure needs. Any surplus is used to fund capital projects and to minimise our future borrowing requirements. Our operating surplus is also positive, again indicating that Council's operating revenue is sufficient to meet operating expenditure. Overall, we are meeting our budget balance requirements. Rates affordability is a key issue for the Council. Our aim is to ensure that we collect no more than 1% of the total capital value of the district from the ratepayers. Given the recent valuation increases in the District by Quotable Value NZ, Ashburton District Council is collecting about $100m less than the benchmark level. With new facilities like the EA Networks Centre coming on stream we had set a limit of increasing overall rates by no more than 8.5% in the 2014/15 year (which was 5% plus 3.5% Local Government Price Index). The total rate increase was slightly lower at 7.2%. This year's rates increase was 5.2%, and the planned increased for 2016/17 is 4.5%, subject to draft annual plan consultation which will occur in April next year. While we are keeping well within acceptable limits, we acknowledge large rates increases are contentious. Council has various schemes to help eligible ratepayers with rates affordability issues, and we encourage people to contact our Customer Services Office to discuss these during normal business hours. The Ashburton district has seen a great deal of investment by Council in recent years, updating our infrastructure and community services and we've had some big ticket items come to fruition. As a consequence our staffing levels have risen, particularly with the operation of the EA Networks Centre. Open 99 hours a week, 88 new staff (many part-time or casuals) are now employed at the Centre. The Council employs 235 staff in total compared to 154 a year ago. By comparison neighbouring councils Timaru employ 299 staff; Selwyn 267; and Waimakariri 372 staff. We will be publishing the full Report and a shorter summary document later this month. If you are interested, both documents will be available in the Library and on our website.