The Hauraki District Council’s mayor and councillors knew nothing about a $450,000 budget overspend on council projects, it was revealed in a recent meeting.
A report tabled at the May 29 meeting said the council’s approved delegation cap of $76 million in net debt had been exceeded in April, with the borrowed figure now standing at $76.45m.
The report said the extra expenditure was due to a higher operating expenditure than forecast, and it recommended the council retroactively approve the overspend. However, councillors were quick to voice their displeasure with the request, saying the overspend was indicative of a persistent over-budgeting culture within council.
“Every time we have these meetings we’re over-budgeting. We need to address [it],” councillor Josh Martyn said.
Councillor Bhavesh Ranchhod said, “Why do we have delegations if they can be exceeded and retroactively approved?”
The question was echoed by councillor Carole Daley, who said, “We’re operating outside our authority.”
Councillors also raised concerns around internal communication. Several members, including Mayor Toby Adams, said they had been unaware of the overspend until they received the report.
“This was quite a big jump and no one knew about it – that’s the part where the councillors are concerned. It should have been flagged a lot earlier that there would be overspend,” Mayor Adams said.
The report said a number of projects on the council’s current work programme would need to be put on hold if the overspend was not approved, until the adoption of the new long term plan. CEO Langley Cavers said the pressure was on the council to achieve 80 per cent of its projects, saying the overspend was a pragmatic, short-term issue. However, he acknowledged the councillors’ concerns, taking note of their “very clear message” not to deviate from project budgets.
“We got it a bit wrong in this case… We spent a bit more than we had planned,” he said.
The overspend was eventually approved by council, which also approved the raising of the delegation cap to $90m of net debt, bringing it in line with new forecasts from the long term plan.
Meanwhile, the council also agreed to continue endorsing Destination Hauraki Coromandel (DHC), bringing it in line with Thames Coromandel District Council’s recent commitment to continue supporting the organisation.
DHC was seeking an “enhanced status quo” from the councils, and tabled a review which said the entity was fulfilling its core purpose but had “room for improvement”. Councils were not asked for extra funding, and the commitment would instead involve more collaboration with DHC to ensure a consistent approach to tourism marketing in the region.
