Annual Report 2012/2013

Stingray Bay

Council adopted the 2012/2013 Annual Report at its meeting on Wednesday, 2 October 2013

Message from the Mayor and Chief Executive

Council has successfully navigated through 2012/2013 which has seen many changes to the laws governing local authorities, and many changes inside Council itself as we continue to establish our new ‘community empowerment’ model of operating. This model recognises the strong Coromandel need for local decision-making, and more authority over the resources needed to achieve local aspirations

This Annual Report is a chance to pause and reflect on how we progressed in the last year of the current elected council’s triennium. With their strategic goal of establishing the community empowerment approach largely in place, we worked through the other elected council priorities of cost-restraint in a period of low growth, delivering on priorities, and transforming our customer culture.

Faced with flat development in the District and ever rising costs, Council took a number of serious expenditure measures inside the organisation which led to the reduction of other direct operating expenses from $38.2m in the previous year to $35.9m in the current period. That reduction of 6% was achieved without reducing levels of service. Overall we finished the year with a surplus of $1.2m, which was under the projected surplus of $3.4m. The key reason for this was not increased expenditure, but the continued drop in expected revenue from development (including consenting). Council responded in the year by dropping its own expenditure significantly, and ended the year in surplus.

Council achieved strong service delivery to its communities. We improved on our achievement of service performance indicators from 72% last year, to 79% this year. With another ten service indicators lying within 3% of being achieved, we are confident in doing even better next year. Our customer satisfaction survey results indicated best ever performance results for core Council services of roads, solid waste, parks and reserves, public conveniences, harbour facilities and cemeteries. The year also saw the Council entering into a major new solid waste contract with our Thames Valley council neighbours (Hauraki and Matamata-Piako Districts) which projects a saving to the ratepayers across the three Councils of $4.7m over the next decade. Alongside other shared services in civil defence, and insurance to name a few, shows our council trying hard for further cost savings to ratepayers but also being selective in the shared services we choose to enter into.

The Council’s main challenge and public shortcoming in the year was around the management of its capital projects. We dealt with a substantial cost overrun on the Mercury Bay Multisport complex which led to us to commission an external review. Council is working through those recommendations. This issue highlighted the most serious issue that has been with the Council for a number of years around the budgeting and delivery of our capital works programme. Delivering only two-thirds of our capital programme is not good enough, and neither is the budget estimation of how much projects cost before the figures are put into our planning documents. It is leading to an annual gap between budgeted capital and actual spent of up to $10m over a number of years throughout the last decade. The Council has undertaken a significant and far-reaching programme internally to address the problems it has in capital project planning, controls and delivery. This is being tightly monitored by the Audit Committee and the Mayor.

This work on our project management is timely as the Council continues to scope some major economic and community development projects to stimulate the local economy and showcase Coromandel’s natural attributes to the world; the Coromandel Great Walks (Hot Water Beach to Cathedral Cove leg), Coromandel Wharves development including fast-ferry link to Auckland, and the continuation of the highly successful partnership with our ThamesValley council neighbours in the Hauraki Rail Trail. This investigation will progress further in the following 2013/2014 year. The concentration on key economic development projects will lead the Council to explore how to fund this work within a tight expenditure envelope.

We would like to extend a very big thank you to our staff and elected members for their tireless effort and contribution throughout 2012/2013. It’s been a big year for us all and there have been some fantastic outcomes for our communities.