By Mark Flyger: CFO – Modern Transport Group of Companies & Council Candidate Hamilton West
Over the past months, I’ve been developing an alternative Council budget that offers a new, future-focused approach for Hamilton over the next decade. As a Chief Financial Officer of 35 years, working for a major Hamilton business, I am used to making financial decisions based upon fiscal prudence and getting the best out of every dollar.
While many believe the only option is austerity, I fundamentally disagree. Growth does not have to come at the expense of fiscal responsibility.
Hamilton has long been described as one of New Zealand’s fastest-growing cities - a source of pride, but also a pressure point. The reality is that while we have seen population growth, this growth has been far, far outstripped by our city’s growth in rates and debt.
Some attribute our financial challenges to depreciation, others, to inflation, high interest rates, economic downturns, rapid population growth, or deteriorating infrastructure.
In truth, several key factors have led us here - and I believe a better path forward exists.
The reasons for our economic woes among other things are:
1. Ballooning Debt. Over the past three years, Council debt has surged by $570 million[1], much of it allocated to Peacocks, including the new bridge, wastewater systems, and roads.
2. Budget Blowouts. Nearly every major project has blown its budget due, in my view, due to inadequate planning, supervision, and an excessive focus on ideological goals over financial discipline.
3. Inexperienced Leadership and Governance. Council decision-making has been dominated by well meaning, but inexperienced; representatives who often follow staff advice without rigorous scrutiny or challenge.
A Budget Built on Efficiency, Not Austerity
I have analysed the city’s accounts and developed a fully costed alternative plan that is rooted in efficiency. It achieves a $45 million balanced budget surplus by 2026, with sustained surpluses across the remainder of the Long-Term Plan (LTP).
It includes:
- A rate increase of just 5% in 2027 (versus the currently proposed 12%), with subsequent increases capped at 3%.
- Reductions in development contribution levies (DC’s) by 20 to 40% to support development and urban intensification in areas like the CBD, Frankton, and Dinsdale.
Why Reduce DCs?
Lowering DCs incentivises Greenfield and brownfield development, which curbs traffic congestion, shortens commutes, and advances climate goals. It also:
- Supports economic uplift via investment and job creation.
- Allows for strategic debt use, enabling intergenerational repayment models.
- Requires a disciplined approach - targeted reductions, sunset clauses, ongoing monitoring, and long-term fiscal modelling.
Procurement and Project Control
The alternative budget proposes a 20% cut in procurement spending, without reducing service levels, achieved through careful project selection, line-by-line reviews, and stronger oversight from subject-matter experts.
Water Done Well & Debt Reduction
With the proper implementation of the Waters Done Well CCO, Council’s interest costs will decline, delivering rate relief and creating room to reduce debt faster. Less debt means lower interest and greater financial flexibility.
Operational Efficiency without Job Cuts
This plan doesn’t call for staff cuts but instead focuses on retraining and upskilling. Expert staff will be empowered to oversee projects effectively, driving quality outcomes and greater cost control. We need well trained staff that drive for efficiency and supervise and control the work Council does. Staff need to be customer focused.
A Call to Leadership
With the right leadership mind-set from Councillors, executive staff, and the organisation as a whole Hamilton can become the most efficient and forward-thinking Council in New Zealand. Done right, we can lead by example, build an affordable and resilient city, and deliver a future Hamiltonians can be proud of. I am happy to discuss this plan with anybody anytime so that we can all see the path forward to an affordable city.
[1] Up from $534m in 2021 to $1.1 billion in 2024 (the last published annual report).
