Of course it will affect rates

The Auckland Regional Council lost $1.79m when too few people turned up to a football game but:

Mr Winder said the ARC was determined the loss would not have any effect on rates or ratepayers.

How can this be?

It’s not just money spent directly by the council which affect rates and ratepayers.

A loss for the council’s business unit is money not available for other projects which directly or indirectly impacts on the council budget and the people who fund it.

5 Responses to Of course it will affect rates

  1. There was every chance the Auckland event could have been a huge success. It’s shame it wasn’t, but I wouldn’t say anyone made a mistake in putting it on. It just didn’t work out. That’s what happens sometimes when you build things and hope people will come. I’d rather see a Council doing things like this to promote a city / town than doing nothing.

  2. Tired Farmer says:

    Mr Winder is another CEO.(Crafty Executive Officer).

  3. adamsmith1922 says:

    Winder is obviously a CEO.

    Any accountant will tell you a loss is a loss is a loss.

    Winder is right in the sense the cost will not fall directly on ratepayers, but the loss will mean no profits available to reduce future rate rises.

    this match was a stupidity from the ‘Get go’ it smelt from Day 1 of JAFA/Wellington rivalry.

    I had hoped with Blumsky’s departure and Hubbard’s that this nonsense was ended.

    Obviously not.

    Morons

  4. Risk-taking is for private enterprise.

    Councils are there to provide services that are too expensive or difficult to organise on a one-by-one basis.

    What possible justification could a council have for running a celebrity football match? It’s not even a real game between two real teams, just a vanity thing. I’m a soccer fan and I couldn’t be bothered, so what does that tell you about the judgement here?

  5. pdm says:

    adam – don’t overlook the impact of compound interest which Einstein once described as the greatest invention ever.

    Great when it is working for you but even at 7% on $1.79m it is a huge cost which must eventually come home to rate payers.

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