Strong growth reported for Hamilton

The strong financial growth continues for Hamilton and the Waikato region

A media statement issued by Hamilton City Council says reports to this week's Finance Committee indicated a continued trend of strong growth in the city, contributing towards an improved financial result against budget for the first nine months of the 2017/18 financial year.

Unlike previous post-meeting statements, this one did not include any comment from the committee chairman councillor Garry Mallett, whose draft monthly report was deemed inappropriate by the council's chief executive Richard Briggs.

Instead the statement has comments from Mr Briggs on the state of the city's finances.

Mr Mallett told Hamilton News he wasn't party to any part of the media release.

In it Mr Briggs says it's important to note the result reported to the committee includes cash and non-cash revenue and costs, but everyday revenue is still not covering the city's everyday costs.

The financial performance against the 2017/18 Annual Plan showed a surplus of $53.4 million, compared to a budget surplus of $7.5m.

The major contributors to the favourable result were revenue from vested assets (roads and other infrastructure built by developers which become council-owned) and development contributions.

Mr Briggs says the accounting result shows the city is still in a period of strong growth.

"We received $30m more from vested assets than budgeted to this point, and $12.4m more in development contributions," Mr Briggs says.

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New development in Hamilton City
"Although this looks like an excellent result from an accounting perspective, we must be mindful these are not cash assets available for running the city.

"The figures highlight the need for a more transparent budget measure which shows only the revenue available to meet day-to-day expenses and doesn't include revenue tagged to pay for building new city assets like roads and water pipes.

"The revised budget measure established as part of the development of the draft 10-Year Plan will provide this transparency and enable the community to determine whether the city is living within its means."

The media statement also says the Finance Committee received monitoring reports on key projects, service levels and a third quarter report from H3, the council's major events and facilities group.

The H3 report showed a $1.2m ($306k at operating level) favourable result against budget in part due to increased event activity across the venues, with substantially-increased attendance figures largely due to the success of the HSBC NZ Sevens and other events at FMG Stadium.

The full reports and agenda are available on the council's website.

Asked to comment on the media release, Mr Mallett says: "It's important to separate the Hamilton City Council from Hamilton City.

"They are different entities. The council is a subset of Hamilton City.

"Yes Hamilton City has enjoyed strong growth."

He suggested speaking to a range of developers and business operators to determine to what extent HCC was a help or a hindrance in that growth.

"The problem I believe council faces is that its activities have strayed miles away from being a provider of core infrastructure," Mr Mallett says.

"Rates (and a small amount of user pay fees) which are meant to cover the day-to-day expenses and to maintain and replace that core infrastructure, have not been enough to cover the cost of the many assets/services that council has decided to provide.

"H3's budgeted annual $16.9m loss is a very good example," he says.


From NZHerald.co.nz