Annual Plan

The Annual Plan 2022/23 has been developed, taking into account a large number of challenges in this current environment.

Our annual plan sets out what we aim to achieve in the next financial year, through our work programmes and associated budgets. Annual plans are effectively an update on the forecasted work and financial information in the Long-term Plan. The Long-term Plan is a ten-year plan, reviewed every three years and it outlines priorities, levels of service and budgets.

The 2022/23 Annual Plan was focused on continuing the workplan laid out in the Long-term Plan, with some relatively minor changes needed to allow for changing circumstances and reprioritising of some work.

Our top priorities continue to be working to protect and restore our freshwater, building our resilience to the impacts of climate change and undertaking transformative work within our organisation to increase our efficiency and better meet the needs of our customers.

A number of our climate resilience projects are underway, with funding from the Government allowing this work to be carried out sooner than we could have otherwise.

We’ve made good progress in understanding the level of change we need to make as a region to address our freshwater challenges. We’ve been sharing this information with our communities.

We’ve also made some significant headway with our Jobs for Nature – Mahi mō te Taio projects in Fiordland.

The Covid-19 pandemic has continued to have implications for both our work programmes and income. Cruise ships have not visited for two years, removing a major source of income. Although there are now plans for them to return, to what degree remains uncertain.

How does the Annual Plan differ from the Long-term Plan 2021-2031?

Rising costs

Like all organisations, we are facing increased operating costs and higher than-expected inflation and interest rates. Inflation increases are most obvious for capital spending due to higher underlying inflation and capacity constraints in the construction and labour markets.

Our staffing costs have increased due to pressures on the labour market and the need to ensure critical resources are in place to undertake the work programmes outlined in the Long-term Plan. A number of these additional costs are offset by savings in contractor budgets as a result of staff appointments to roles previously outsourced, such as procurement, or as a result of roles which largely recover their own costs, such as compliance.

The projected surplus for this financial year has allowed us to absorb a number of these additional pressures on the budget.

Climate resilience projects

Business cases for our climate resilience projects (shovel-ready) were prepared in 2020 when the Government made funding available. Like all of the climate resilience projects throughout the country, the project scoping and application process ran over a very short timeframe. While considerable work was put into coming up with the best plan possible, we always knew that it would require much more additional work to firm up the specifics of the projects and get more accurate costings. There has also been significant change within the construction market, with high demands being placed on the construction sector in Southland. This has meant service providers are less available and come at a higher cost, while we also face challenges with materials and supply chain issues. An additional $3 million contingency has been built into the budget (to be funded via debt) to provide for potential additional costs associated with these projects. However, the final costs of the projects are as yet unknown and will not be known prior to the Annual Plan being adopted by Council.

We have been working to review the climate resilience projects in light of these factors. Our focus is on ensuring we manage the critical risks from climate change, balanced with ensuring the best value for money for our communities.

Rabbit control rate

We consulted with landowners in a specific area east of the Mataura River, from Wyndham to Fortrose, who have for several years paid a rate to cover rabbit control carried out by the Southern Pest Eradication Society. Following consultation, a new rate, known as a Rabbit Control rate, will replace the previous rate. The new rate is higher to cover increased costs for the work, as well as costs associated with administering and monitoring the contract.

For activities funded by rates that relate to the implementation of the Southland Regional Pest Management Plan, consideration has been given to the requirements of Section 100T of the Biosecurity Act 1993.

Rates examples

Actual dollar amounts for this year’s rates increase vary from property to property depending on a number of factors. The overall amount is made up of a mix of land and capital value rates. The impact of these changes is lessened by the Uniform Annual General Charge, but changes in property valuations are likely to affect many properties.