Environment Southland is striving to make considerable savings on its expenditure for the Annual Plan 2020-2021 ahead of its adoption next week.
Last month the Council announced an expected drop in income of around $3.5 million in the 2020-21 financial year due to the negative impacts of COVID-19 on the marine fees from cruise ships and its financial portfolio.
At the time, Chairman Nicol Horrell said Environment Southland was in a good position to weather the shock, but that it would be challenging and require the Council to manage its expenditure tightly.
The floods in the Waiau in December 2019 and the Mataura catchment in February have contributed to the situation. In total the cost of the repairs and the emergency response amounted to more than $5 million dollars. Environment Southland is hopeful that National Emergency Management Agency and insurance will contribute approximately $1.5 million, $2 million will be drawn from the Council’s reserves tagged for this purpose. The remaining amount – more than $1.5 million – has been provided from the catchment budget by reprioritising the existing budget.
Additionally, a reduction of more than $500,000 in expenditure has been achieved across the organisation. It includes holding off on filling some vacant positions, reducing travel and conference expenditure and various other savings. This will reduce expenditure in 2020-2021 to the level of expenditure in 2018-19.
Chairman Horrell said it was important the council worked as hard as it could to reduce expenditure. “It’s a fine line between making significant savings and still being able to deliver on our responsibilities, and this is the balance we are striving for.
“Even so, we are still expecting a budget deficit this coming year, but with careful management of expenditure and by leveraging our balance sheet to good effect we believe we should be able to get to a balanced budget by 2025.”
The Council aims to finalise its annual plan and associated budget at the Council meeting on 30 June.