Hastings
District Council: Performance & Monitoring Committee Meeting
Te Rārangi Take
Report to Performance and Monitoring Committee
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Nā:
From:
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Bruce Allan, Deputy
Chief Executive
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Te Take:
Subject:
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Hawke's Bay Museums
Trust Half Year Report to 31 December 2025
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1.0 Purpose and summary - Te Kaupapa Me Te Whakarāpopototanga
1.1 The purpose of this
report is to provide the Performance and Monitoring Committee with the half
year financial report from the Hawke’s Bay Museums Trust (HBMT).
1.2 The Trust’s
Chair, Dr Richard Grant, will attend this meeting to answer any questions from
members of the Committee.
1.3 The Trust is a Council
Controlled Organisation with most of its funding provided by the Napier City
and Hastings District Councils.
1.4 The Hastings District
Council’s appointment to the Trust is Mr George Lyons who was appointed
to the Trust by Council in November 2013. This appointment is normally
addressed through the appointment process following the triennial elections and
Mr Lyons was reappointed in 2025.
1.5 The current trustees
of the Hawke’s Bay Museums Trust are:
Dr Richard Grant
(Chair)
Tania Wright (NCC)
George Lyons (HDC)
Jeanette Kelly
Thompson Hokianga
1.6 As required under the
Local Government Act 2002, the Trust is to provide a draft Statement of Intent
for comment by 1 March each year and a half-year report within 60 days of the
end of the first six months.
1.7 The objectives of the
Trust, amongst other things, are to hold, protect and manage the regional
collection for the people of Hawke’s Bay including overseeing the
collection development through acquisition and disposal of collection items.
The Trust Board governs on a high-level strategic direction basis to ensure the
objectives of the Trust are being met and have a Management Agreement with
Napier City Council for the care and management of the regional collection.
1.8 The 2025/26 financial
year has been a year of transition for the trust and the collection with the
completion of the new Museum storage, research and archive centre Amokura and
the relocation of all 90,000 items in the collection. During this time there have
been some duplication of costs as the relocation took place and the Trust
operated from multiple buildings.
Half-Year Report
1.9 The Trust’s
financial statements for the six months to 31 December 2025 are attached (Attachment
1). There was a sizable increase in Council support for the Trust in
2025/26 to cover transition costs associated with the relocation of the
collection to Amokura.
1.10 Note 12 to the accounts provides a
comparison to the current year’s Statement of Intent budget. The
half-year accounts show an operational cost allowance for the new building
which aligns directly to the budget. NCC finance staff will reconcile this to
actual costs prior to year end so that it reflects actual costs not just the
allowance provided for in the SOI. The Council grants have largely covered the
Trust’s operations.
Statement of Intent
1.11 The draft HBMT 2026-2028 Statement of
Intent (SOI) is yet to be finalised with agreement not yet reached between the
two funding councils on the allocation of costs between the MTG/Kahukura and
the role the Trust plays in caring for the collection. The SOI contains the
performance indicators and targets which would largely remain unchanged and
have previously been set for the key result areas of:
· Protection
– including storage, security and records management;
· Quality
– including conservation, accessioning and de-accessioning;
· Access
– including ensuring the collection is available for exhibitions,
research and archives; and
· Development
– including fundraising, reserves management and stakeholder relations.
1.12 Once the SOI has been finalised and
approved by the HBMT Board it will be presented to Council, likely to be 20
June 2026.
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2.0 Recommendations -
Ngā Tūtohunga
A) That the Performance
and Monitoring Committee receive the report titled Hawke's Bay Museums Trust
Half Year Report to 31 December 2025 dated 20 May 2026.
B) That the Committee
receive the Hawke's Bay Museums Trust Half Year Report to 31 December 2025.
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Attachments:
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1⇨
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Hawke's Bay Museums Trust - Half Year Financial Report
SIGNED
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CG-18-04-00030
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Vol 1
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Te Hui o Te Kaunihera ā-Rohe o Heretaunga
Hastings
District Council: Performance & Monitoring Committee Meeting
Te
Rārangi Take
Report
to Performance and Monitoring
Committee
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Nā:
From:
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Aaron Wilson,
Financial Controller
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Te Take:
Subject:
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Nine Months
Financial Result 31 March 2026
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1.0 Purpose and summary - Te
Kaupapa Me Te Whakarāpopototanga
1.1 The purpose of this report is to present the financial
results for the nine months ended 31 March 2026.
1.2 The
results are consistent with those reported in previous quarters, with no
significant changes in the financial trend over the past three months.
The summary of the
results is as follows:
o Revenue: Council
revenue of $239.3m is $19.5m unfavourable to budget.
o Of this Capital Subsidies and
grants are $17.8m unfavourable due to lower capital expenditure
resulting in lower claims made to funding partners.
o Operational Revenue is $0.4m
favourable to budget with the main drivers being:
§ Operating subsidies favourable to
budget by $3m driven by timing of funding of $2.1m received for Cyclone
Gabrielle, along with $0.9m of Community Grants.
§ Fees & Charges unfavourable to
budget by $2.9m driven by lower volumes in Landfill and Waste.
o Total Operational
Expenditure: Expenditure of $175.4m is $7.6m favourable to budget,
largely due to timing differences in expenditure during the first nine months
of the year.
o Depreciation: Non-cash
depreciation at $51.7m is unfavourable to budget at $3.0m
o Capital Expenditure:
Actual capital spend is $135.9m against a budget of $168.5m (including cyclone recovery
projects). The latest capital forecast reflects a $30m reduction to the
Annual Plan of $264.2m.
o Net Debt Position:
Council has not borrowed any additional debt in the third quarter. The net debt
position is $461.7m.
o Forecast:
Officers have reforecast both revenue and operating expenditure for the
year. Revenue is expected to come in below budget mainly due to lower
subsidies and grants linked to reduced capital delivery, as well as decreased
fees and charges mainly from reduced waste volumes. Offsetting this, total
operating spend is forecast to be under budget, driven by lower personnel and
operational costs. This position is in line with expected trends and reflects
performance to date.
*Please note the above
differences will be explained in more detail below.
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2.0 Recommendations - Ngā Tūtohunga
That the Performance and Monitoring Committee receive the
report titled Nine Months Financial Result 31 March 2026.
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3.0 Background – Te Horopaki
3.1 The
financial result is reported quarterly during the year. The result is compared
to the Annual Plan adopted by Council. The forecast commentary reviews
year-to-date trends and provides an indication of the expected year-end
position, supporting informed decision-making.
3.2 Attached
to supplement this report is Attachment 1 – Whole of Council
Dashboard Summary of Financial Performance, including revenue, operational
costs and capital expenditure.
3.3 Financial
commentary on the individual activities is now reported as part of the
operational Performance and Monitoring report. This provides a more complete
picture of the activity with the financial commentary complimenting the update
of the operational performance.
3.4 If
Councillors require clarification on any points, please contact the writer, or
Chief Financial Officer, prior to the meeting to ensure complete answers can be
given at the meeting on the detail in these reports.
4.0 Discussion – Te Matapakitanga
4.1 The
following provides a summary of the overall Council’s financial
performance for the nine months ended 31 March 2026.
4.2 Revenue:
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Revenue: 31 March 2026
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Actual Ytd ($m)
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Budget Ytd ($m)
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Variance Ytd ($m)
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Rates
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115.1
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114.8
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0.3
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Fees, charges &
other operating
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37.1
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40.0
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-2.9
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Operating
Subsidies
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10.0
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7.0
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3.0
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Capital Subsidies &
Grants
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74.2
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92.0
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-17.8
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Other Capital Revenue
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2.9
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5.0
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-2.1
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Total Revenue
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239.3
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258.8
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-19.5
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4.3 Council
revenue is $19.5m unfavourable to budget, made up of:
o Rates, the annual rates
charge is recorded as revenue equally throughout the year.
o Fees and
charges are $2.9m unfavourable. Driven by lower volumes at the Transfer
station and at the landfill ($3.1m unfavourable). Volumes are not expected to
recover through the remaining three months of the financial year, with the
forecast reflective of this.
o Trade Waste favourable to
budget by $0.3m.
o Parking $0.3m favourable to
budget in carpark revenue and infringements.
o Large number of smaller
variances across many activities.
o Operating
subsidies received are $3m favourable due to the timing of received
payments for Cyclone Gabrielle. Operational subsidies and grants of $0.9m
favourable were received and cover several community/social grants for
programmes. The subsidies received are to offset the costs of running those
programmes.
o Capital
subsidies and grants are $17.8m unfavourable due to lower capital
expenditure and claims made to funding partners in the nine months of the year.
o Other
capital revenue is mainly driven by Development Contributions which are
$2.1m unfavourable. Although DC revenue remains unfavourable, there was a large
portion of DC revenue recognised in March from one development.
Development Contribution revenues are irregular and are driven by developer
activity and project schedules. There are a wide range of developments in
terms of size and at different stages.
4.4 Operational
Expenditure:
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Expenditure: 31 March 2026
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Actual Ytd ($m)
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Budget Ytd ($m)
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Variance Ytd ($m)
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Personnel Costs
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41.0
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42.6
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1.6
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Finance Costs
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16.5
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16.7
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0.2
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Other Operating Costs
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66.2
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75.0
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8.8
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Depreciation
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51.7
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48.7
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-3.0
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Total Operational
Spend
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175.4
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183.0
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7.6
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4.5 Operational
expenditure is favourable to budget by $7.6m and is made up of:
o Other
Operational costs through the first nine months of the year are $8.8m
favourable to budget. There are several drivers due to timing of spend, along
with business decisions which has meant a change from when the budget was set.
Key drivers include:
o Project Genesis is a project
migrating the Council’s ERP system to a cloud platform. Operational spend
excluding personnel costs is $1m favourable to budget, which will not be spent
in the current financial year. The total remaining budget in the current
financial year is $1.3m and will be budgeted into future years. This is
loan funded and there is no rating impact.
o Blackbridge Grant
to HB Regional Council (HBRC), is $1.1m favourable. Whilst a cultural
assessment is underway; the work will not be completed in the current financial
year. This project comes under HB Regional Council’s programme of work.
The total budget in the current financial year is
$1.5m and will be budgeted in 2026/27 once HBRC confirm their work
schedule. This is loan funded so there is no rating impact.
o Contracted Services is $0.9m
favourable to budget. Whilst there were costs that have come through from the
January rain event for Transport this has been offset by lower spend in water
maintenance and a wide range of other areas across Council.
o Landfill and Waste management
costs are favourable from lower volumes including external plant hire is $0.5m
favourable.
o ETS Carbon Credits is $2.4m
favourable to date. This is due to a change of accounting process. The
Landfill Committee approved a change to the ETS process after the 2026 annual
plan was finalised to a once-a-year transaction at year end.
o Personnel costs are
$1.6m favourable to budget. Splash Planet temporary staff costs have been
closely managed on rain affected days through the summer season and is $0.7m
favourable. Across other activities there are a number of vacancies, and
savings in personnel costs.
o Finance costs are $0.2m
favourable with some impact being seen from the improved (lower) net debt
position that has continued through the financial year.
o Depreciation is
unfavourable by $3m and is driven by higher external valuations in
infrastructure and parks, received at the end of the previous year, after the
Annual plan and budgets were adopted. To minimise the risk of similar
situations in future years Council has planned to have the valuations completed
earlier in the year.
5.0 Forecast
5.1 Financial forecasts to year end have been undertaken by
officers based on the year-to-date actuals to end of February 2026 and
projections for the remaining 4 months. The purpose of the forecast is to give
Council an indication of year-end financial position to support informed
decision making.
5.2 Revenue
is forecast to be lower than Annual plan by $10.4m and is driven by:
o Lower forecasted capital
subsidies and grants funding due to lower forecasted capex spend.
o Lower forecasted
fees and charges driven by lower volumes in the Transfer station / Landfill,
along with lower insurance reimbursement for bridges.
5.3 Operational expenditure is forecast to be lower than Annual
Plan by $2.3m and is mainly driven by:
o Lower forecasted personnel costs of $0.8m, whilst this is
lower than the favourable $1.6m to budget Year to Date, this is reflective of a
combination of vacancies, timing of budget and training.
o External plant hire in Landfill is forecast to be
favourable and is on track with Year-to-Date trend at $0.2m.
o Project Genesis operational costs excluding personnel is
forecast to be $1.4 million favourable to budget with spend budgeted into
future years.
o Blackbridge grant is forecast to be $1.5m favourable to
budget, as this HBRC project did not get fully underway, this will be
rebudgeted in 26/27.
o Depreciation is forecasted to be $3.9m unfavourable to
budget, this is on track with year-to-date trend.
o Fuel related costs: The impact of the fuel cost movements
for the last quarter of the financial year for fuel costs is estimated at
$0.2m.
6.0 Approved Unbudgeted
Expenditure
6.1 There
is additional prioritised expenditure has been approved across Council
activities that were not in the 25/26 Annual Plan. These form part of the
variances against budget reflected in the result to-date and in the forecast
end year result.
6.2 This
expenditure is driven by work related to property issues/settlements. The total
amount Year to Date is $0.3m and will be funded by debt.
7.0 Capital Expenditure
7.1 Council’s
total adopted capital budget (including renewals, new works, and growth
projects) for both Business as Usual (BAU) and Cyclone Gabrielle 2025/26 is
$264.2m.
7.2 BAU
capital spend is $76.9m for the first nine months, this is favourable to the
Ytd budget of $117m. The main area of underspend remains within
infrastructure, across growth, transport and 3 waters areas.
7.3 Cyclone
Gabrielle capital spend for the first nine months, is ahead of budget with a
spend of $59m against a budget of $51.5m due to projects completed ahead of
time. Should be noted expenditure on a couple of bridges have been moved
into future years.
7.4 The
lower spend to BAU budget variance Year to Date is largely due to timing
factors, including delayed construction starts, procurement sequencing, and the
phasing of cashflow and budgets.
7.5 Across
the wider capital programme there has been rephasing of projects with some of
that expenditure moved into the 26/27 year. This represents $30m of
reprioritised projects into next year, with final details currently being
worked through.
7.6 Infrastructure
investment is the main driver of Council’s capital expenditure. The
programme has historically underspent. Finance and the Programme Delivery
Office (PDO) are working together to continuously improve the outcomes.
7.7 The
table below shows a breakdown of capex by spend type and by areas within those
types.
8.0 Cash and Treasury
8.1 External
debt of Council as at 31st March was $493.7m. Cash holdings in March
were $32m leading to a net debt position of $461.7m. Council has a liquidity
position of 115%. This indicates that Council has available funds to cover its
known financial obligations as they fall due.
8.2 There
is a continued focus on ensuring timely invoicing for large capital projects to
our key funding partners (NIFF/NZTA) to manage and maintain control over
cashflows.
8.3 Latest
year-end forecast for external debt is $507.7m against an annual plan of
$549m. The lower forecast external debt is due the lower forecasted capex
spends and the continued focus on cash management through this financial year.
8.4 Council
remains compliant with its Treasury Management Policy limits. The Risk and
Assurance Committee reviews and monitors Council’s treasury performance
and policy on a quarterly basis with advice from Bancorp Treasury Services.
Attachments:
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1⇩
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March 2026 Quarterly Dashboard
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FIN-09-01-26-234
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