A clucking mess
diVision’s chickens continue to come home to roost, and they’re showing signs of carrying the H5N1 bird flu virus.
Just before they got to vote on the mayor’s borrow-and-sell plan for the Splash Centre yesterday, councillors found themselves "noting" some pretty scary info in a wee item called Debt Servicing.
In it, the new money guy Julian Harkness sounds the alarm about growing debt servicing costs and warns that by 2008/09 interest costs will be up by anything from $0.6 million to $1.6 million on top of the annual charge of $2.9million.
He had the foresight to factor in $2.5 million in new borrowing for the swimming pool, even though it hadn’t even been passed at committee stage, and under the intriguing heading "What we may not have included" he tossed in $3.5 million for Heart of Wanganui.
Commenters have noted that around $3 million worth of City freehold properties have been tagged for sale and concluded that "the money's there". Well yes it is (assuming the properties sell for at or above valuation) - all three million of it. One whole year's annual debt paid at current levels and before the additional borrowing toward which the Diva is determinedly herding the diVision chickens.
And then what? Harkness, who obviously hasn’t yet been received his allocation of the diVision anti-reality anti-viral, lists the stark options as:
The item was tagged, as just about everything is, as being "not significant in terms of policy". Dotty may well have found that just the funniest thing since Professor Phard of Saudi Arabia died, but her new found girl pals Barb and Sue got all serious and pointed out that it was really bloody significant, whichever way you look at it.
And Sue even had the temerity to suggest that that thing called "the public" might find it a bit strange that the scary story about the debt mountain wasn’t significant, yet in the next period the class would be putting up their hands on the Diva’s splash centre borrowing plan.
That made the Diva throw a hissy fit and even Dotty managed to suppress her giggles and simper her seconding of the mayoral motion as he ruled her former girl pals out of order and pulled the plug on discussion of the whole debt servicing mess. "They are not for discussion now, they are not for discussion next month, they are not for discussion next year …" he growled.
Wise leadership from the Diva again. While the chickens coming home to roost may be susceptible to the dreaded avian flu, there's been no mention so far of the disease hitting that magnificent bird, the ostrich. So when faced with talk of rising debt, what better example to follow?
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25 comments:
Just had a look at Tuesday's Committee notes, I see tiny section untitled AUDIT, with the one sentence 'The audit is finished.' Could anyone enlighten me as to the time frame in which this process took place? Old or new council or both? Thanks.
What does Ken and the mayor talk about in those afternoon meetings? Perhaps Ken is teaching Mickey the correct way to say of Tena koutou, tena koutou, tena koutou, tena koutou, tena koutou, tena koutou.
Good evening Wanganui, haven't seen your Mad Mayor on any front newspaper cover lately, has he cleaned up your gang problem already? Looking forward to this evening viewing, just hope he stop's touching his fellow contestant.
If Harkness keeps going like this he'll be labelled the new Hindson. Remember, if you can't find a council officer who'll do it your way, keep going 'til you do.
More direct evidence of mayoral incompetence. Thanks Watchers. It's not the first time Laws has proved an untrustworthy guardian of democracy, and it won't be the last.
The mayor good tonight on that Prime quiz show. Don't know about the T-shirt though - getting their campaign in early.
There was nothing in the LawsWatch or Julian Harkness analysis that ML didn't report in Council Report six weeks ago. His idea is to sell assets or reduce services, I assume because he's still on about rates being too high.
With the new CEO in place, presumeably the agenda would be to slash staff levels. There may be dead wood in the admin side, but I don't know how smart it'd be politically to start affecting services too much.
Of course some staff will have to go. Mind you, they all seem to be busy these days not like the good old days when they stood around gossiping or went shopping.
According to the Chron, CEO Warburton said that:
"forestry and other property sales would be used to pay back the Splash Centre Loan"
But in September, Mickey Laws wrote:
"It is not currently a prudent
option to harvest or sell the
forests. Then there’s the
question of who would buy
them anyway."
What gives? Is this some new way to maximise return for the ratepayer? Sell low to pay off interest? Perhaps the idea is part of WDC's foreign policy (what with creating a standing army, raising the flag & all). We can borrow heavily from the World Bank then, when they come for the money, do a Brazil and tell them to get stuffed. The entire American economy, according to Raulston-Saul, was founded on debt write-off. Or will we simply go the way of Rodney? Mitchell stirred that pot too, didn't he?
I have to agree with an earlier poster - Michael Laws has been warning for months about what debt levels and interest charges will do to council's budget and he actually went further than Julian Harkness by siggesting the sale of Wanganui Gas in the Council Report newsletter I received. A poor post Laws Watch, because a) the mayor laid it all out months ago and b) the guy's analysis is right. If you're goping to be paying a $1 million more in interest payments a year then the shortfall has to be made up somewhere.
Then you ask the next question: how come Dave Foster is telling the last council that peak debt will be $20m less? If there is one thing this new council can be congratulated for it is getting the council finances under control
Were we watching the same show, anon? So far as I could see he's just there to make Mike Hoskings look good. Failed to answer any but a couple of questions and put on a good show of looking like a constipated chook trying to produce answers he clearly didn't have. He just did lots of finger clicking and squirming while Hoskings, of all people, delivered the goods.
Missing the point aren't you, LawsWatch.
The money (from the land sales) is there for the Splash centre. It isn't being used to budget the yearly books. The extra $1m of interest will have to be paid from reducing services, raising rates or selling other assets like Gas 9to reduce the debt). It's not hard. Keep up!
Ya gotta love it ... not one but TWO pictures of Laws on the ratepayer-funded community link page in today's chron -- oh he even found room for Dotty too.
anonymous: "Michael Laws has been warning for months about what debt levels and interest charges will do to council's budget"
So why then is he happily adding to those debt levels? And why doesn't want councillors debating it before the buy-election?
I can't agree about ML's appearance on the TV quiz show - its entertainment and he entertains.
"If there is one thing this new council can be congratulated for it is getting the council finances under control"
You call adding millions of dollars to our debt burden "under control"? What colour is the sky on your planet?
Where have you been, LawsWatch?? The latest council report had all your so-called shock/horror info in it over 2 months ago and even looked at possible solutions.
Wasn't the last council going to have to borrow (or impose higher rates) to pay for the Sarjeant Art Gallery extension? Is there some hypocrisy here - OK for an art gallery but not for a swimming pool.
Wasn't the last council going to have to borrow (or impose higher rates) to pay for the Sarjeant Art Gallery extension?
Simply, no, because there were far more lucrative sources of outside funds. Chas' Council had committed to a 'nil' rates increase in any case.
And it's your darling Diva who says borrowing is bad, but not for his pets, so who's the hypocrite?
Simply, no, because there were far more lucrative sources of outside funds. Chas' Council had committed to a 'nil' rates increase in any case.
And it's your darling Diva who says borrowing is bad, but not for his pets, so who's the hypocrite?
1:51 PM, November 24, 2005
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This is a nonsense post and totally inaccurate. Why do people make these sort of things up?
No nil rates increase wwas proposed by Chas' council - their last one was 4%. And the $3.5m was all to be funded by the sale of assets or special dividends from Wg Gas. Unfortunatrely they agreed to underwrite the entire project so with incr building costs and the "missing million" they would have had to find up to $5 million.
Let's balance that agst this council fuinding $2.5m for the Splash Centre from - selling surplus land.
So, when do Capt Unsworth and his merry crew come back to the council table and start twisting arms again for a bit of ratepayer underwriting for the pool, do you think, anon?
Will every last cent of their $1.5 million have to be in the bank before the first hole is dug ... or can we look forward to seeing the mayor doing another neatly executed double backward flip with one and a half twists while he contemplates the nature of his own hypocrisy.
"occasional random idiocy" in the mayor's column today - which councillors is he referring to? This is as clear a breach of the code of conduct - he is calling his fellow electeds morons! What is wrong with these people? Why don't they defend themselves?
I thought I had read it in minutes - can't find it now, but on Sarjeant funding it's there in B&W:
"In regards to funding the new Gallery building the Council has a number of options it can
use to finance the project. Those options will not impose significant rates increases, if any
at all, above the current levels projected in the plan. Rates will need to continue to move
with inflation but the work programme including the Gallery project can be done."
So, simply, no, because there were far more lucrative sources of outside funds.
If I find the nil rates reference I'll post that too.
I think he means the kind of random idiocy that saw him elected.
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