Highest staff costs per ratepayer – research assesses Wellington City Council

News from NZ Taxpayers Union
The Wellington City Council is left embarrassed by its neighbouring territorial authorities, according to Ratepayers’ Report, the Taxpayers’ Union’s local government league tables, released today. Metrics including total operating expenses and total liabilities per ratepayer were used to assess the Council’s performance, with the Wellington City Council often ranking worse than neighbouring authorities in the league tables.

Garrick Wright-McNaughton, a researcher at the Taxpayers’ Union, says: “The Upper Hutt City Council appears to be running a slick operation, with the lowest average residential rates, operating expenses per ratepayer, and relative staff costs in the region. Ratepayers in neighbouring authorities should be questioning why their councils do not appear to be operating as efficiently as Upper Hutt City.”

“If low rates are what you’re after, Hutt City’s the place to buy a house. Its average rates bill even beat the rates councils charge in the Wairarapa.”

“Porirua City Council charges the highest average residential rates in Wellington, $2,612 per year. While this initially appears to be a surprising result, it may reflect the ability of other authorities to rely on commercial rates, particularly in Wellington City.”

Ratepayers’ Report reveals that the Wellington City Council has the highest staff costs per ratepayer in the region. The City Council pays a much greater proportion of its employees a salary in excess of $100,000 than neighbouring Wellington councils.

“One area where the Wellington City Council excelled was dismissing poor performing staff,” says Mr Wright-McNaughton. “The Council dismissed 17 staff as a result of performance-related issues in the 12 months up to April 2017. According to the data we’ve collected that makes them the most aggressive in the country in terms of pushing out underperforming staff.”

“With one member of staff for every 40 ratepayers, Carterton District Council has the highest staff costs in the region, at $1,483 per ratepayer. Similarly, sized South Wairarapa District Council employs one member of staff for every 57 ratepayers, at a cost of only $999 per ratepayer. Carterton ratepayers may ask why their Council needs so many more staff.”

“Ratepayers’ Report is available online and free of charge so all Wellington ratepayers can judge for themselves the performance of their local town hall.” Ratepayers’ Report available at www.ratepayersreport.nz

Note: All references to rates in the above comments refer to residential rates.

Other findings relating to the Wellington region:

• Upper Hutt City Council charges the lowest average residential rates in the Wellington region, at $2,031 (well below the regional average, $2,349).

• Porirua City Council charges average residential rates of $2,612, the highest of any city council in New Zealand.

• At $101,885, Wellington City Council has the most assets per ratepayer of any metropolitan council.

• Wellington City Council dismissed more staff due to poor performance than any other territorial authority in New Zealand: 17. The next highest was Hamilton City Council, with seven.

• Kapiti Coast District Council compares strongly, with council operating expenses per ratepayer well below the national average.

• Councils considered for this comparison are Carterton District Council, Hutt City Council, Kapiti Coast District Council, Masterton District Council, Porirua City Council, South Wairarapa District Council, Upper Hutt City Council, and Wellington City Council.

Q & A

What is Ratepayers’ Report?

Ratepayers’ Report is interactive local government league tables covering financial position, performance, and governance information for all of New Zealand’s territorial authorities (excluding the Chatham Islands).

What is the purpose of Ratepayers’ Report?

Ratepayers’ Report provides accountability and transparency to New Zealand ratepayers by allowing anyone to compare their local territorial authority with others around the country.

Where was the data sourced?

The New Zealand Taxpayers’ Union working with its sister group, the Auckland Ratepayers’ Alliance, compiled the data in Ratepayers’ Report after reviewing each council’s annual report for the year ending June 30, 2016.

Other figures represent the most up to date figures available and were mostly obtained under the Local Government Official Information and Meetings Act.

The data has been sent to each individual authority for their review and error checking prior to public launch.

Population data is from Statistics New Zealand.

Where did the group finance figures come from?

They are taken from each Council’s annual report. They include council figures, plus any subsidiary council controlled organisations.

Which councils are assessed in Ratepayers’ Report?

Of New Zealand’s 67 territorial authorities, 66 are examined in Ratepayers’ Report. That includes all city, district, and unitary councils, with the exclusion of Chatham Islands Territory Council (due to concerns surrounding that Council’s workload pressure and unique position). In future iterations of Ratepayers’ Report, we plan to incorporate regional councils into the analysis.

Is this the first Ratepayers’ Report?

No. Ratepayers’ Report was first published in 2014 jointly by the Taxpayers’ Union and Fairfax Media.

How are the councils (territorial authorities) grouped?

• Unitary authorities – the 5 territorial authorities which also carry out the functions of a regional authority are grouped.

• Metropolitan – the 5 large councils with a population of over 120,000.

• City – 6 smaller metropolitan councils with populations between 40,000 and 120,000.

• Provincial – the largest group, 27 non-metropolitan councils with a population over 20,000.

• Rural – 23 councils with populations less than 20,000.

How was the average residential rate calculated?

Calculating an ‘apples to apples’ figure for residential rates is difficult because councils use various mixes of rates, levies, and user charges. Our approach is based on work by Napier City Council to find an average residential rate. The methodology councils were asked to use to calculate the figures disclosed in Ratepayers’ Report is available here, www.taxpayers.org.nz/rp_methodology.

While we think this approach is useful and fair, the average residential rates figure should be a guide only. It does not, for example, factor in councils’ reliance on commercial rates. It also puts unitary authorities at a disadvantage. Unitary authorities (Auckland Council, Nelson City Council, Gisborne, Tasman, and Marlborough District Councils, and the Chatham Islands Council) perform the functions of a regional council and therefore can be expected to have higher rates than other territorial authorities.

Were councils consulted in the process?

Yes. Every council was sent a draft version of their respective page to review.

News from Kapiti District Council
The 2017 Ratepayers’ Report shows Kāpiti Coast District Council continues to perform strongly in terms of operating costs per ratepayer, ranking second-lowest in the country.

Mayor K Gurunathan says he is pleased to see the Taxpayers’ Union report show the Council performing so well in terms of efficiency when it comes to the day to day costs of providing services across the district.

“The Council works hard to keep costs down and today’s report shows that we’re a fairly lean organisation when our operating costs are compared with those of other councils. It puts us in a similar place to last time the report was compiled, and it’s heartening to see that consistent performance.”

Mayor Gurunathan says the results emphasise the challenge that Kāpiti faces in keeping rates at an affordable level.

“Our heavy reliance on rates as our main source of income, coupled with high debt levels, means that despite operating efficiently we still have higher than average rates.

“We’re at the beginning of a journey towards addressing our debt levels. We’re making some hard calls now to spend less in order to pay back more debt. This will mean we meet the needs of our communities not just for the next three years, but for the next 20 to 30.”

www.ratepayersreport.nz

 

5 comments:

  1. Mary M, 22. August 2017, 9:47

    This report lacks transparency and provides no accountability.
    The actual ‘performance’ of the councils from the ratepayers perspective is not even defined and all figures (and data) are provided by the councils themselves from their annual reports.

     
  2. Peter Kerr, 22. August 2017, 13:17

    Don’t use a misleading headline. This isn’t research. The authors themselves are ashamed enough to refer to it as a report only.

     
  3. CPH, 22. August 2017, 17:36

    Mary M – You make a good point, but I would suggest that the Wellington City Council is struggling to provide the actual performance as well. For instance the Town Hall upgrade is years late and miles over the original budget, the Movie Museum is a year late and much more expensive than originally advertised, the Island Bay cycle lanes are vastly more expensive than originally planned and don’t even work correctly, and light rail is nowhere to be seen. That very large collection of very expensive employees doesn’t seem to be producing the results the city expects.

     
  4. Mary M, 23. August 2017, 7:37

    The WCC funding unneeded projects and subsidizing private ventures makes for a very poor performance.

     
  5. Michael Gibson, 23. August 2017, 8:00

    CPH – regrettably, the problem lies in a) the lack of political leadership and b) the influence of developers. If anyone wants details please let me know!

     

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