Coronavirus: Auckland Council top brass cut own pay by up 20 per cent

Friday, 17 April 2020

Auckland Mayor Phil Goff announces Auckland Council facilities will close (video first published in March).

Top executives at Auckland Council and its five major agencies have volunteered to take a 20 per cent pay cut for six months, in response to Covid-19 pressures.

The 20 per cent cut will also be taken by the chairs of boards at Auckland Transport, ATEED, Panuku Development, Regional Facilities Auckland and Watercare.

Senior executives across the council group will take 10 per cent cuts, as will the directors on the five agency boards.

Auckland Council chief executive Stephen Town

'A pay cut is the right thing for us to do in the current environment,' said Stephen Town, council chief executive.

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Town had previously flagged to Stuff that the discussions were going on amongst the group, and the cut affects 53 executives, excluding directors on agency boards.

'We understand how tough it is for many New Zealanders right now,' he said.

'While this won't have a big impact on the council's financial position, it acknowledges that as leaders we need to play our part by showing solidarity with communities and businesses,' said Town.

The cuts go deeper than those announced by the Government, which covered just the chief executive level across the public service, as well as Prime Minister Jacinda Arden.

Following the Prime Minister's announcement on Wednesday, Auckland Mayor Phil Goff announced he too would take a six-month 20 per cent cut to his almost $300,000 salary.

The council executives are not sorted by salary, but are those who report directly to the chief executive.

The announcement does not apply to the mayor's office.

The salary cut announcement followed the release by the council of the financial hit it will take due to Covid-19.

A 12-page report considered by councillors laid out that revenue could be cut by between $450-$650 million, depending on whether severe impacts lasted six or 12 months.

The council may delay the introduction of its annual budget to the start of August, to enable a new round of public consultation on whether to stick with the proposed 3.5 per cent average rate rise, or opt for a lower increase of 2.5 per cent.

Council staff recommended sticking with the 3.5 per cent level, and offering assistance to those ratepayers facing hardship in paying their rates bills.

Goff said for an average value property, the difference between the two increases would be 48 cents a week, with the higher increase costing $1.83.

The council's first major response to the fiscal hit has been to cut up to 1100 positions filled by temporary, or contract staff, or consultants.