Long Term growth forecast

[charlie]

Take a look at the file "10 year plan growth revised up.pdf" in the
files section

To me this looks like a fudge to avoid breaching the council
borrowing
levels. The growth for 2012+ has been ramped up to average the 10 year
period. 10 and 11 are reduced as one would expect but still look very
optimistic 12+ is dreaming...
Take a look at the Treasury figures for the first Q1 and Q2 2010 at
this site
http://www.treasury.govt.nz/economy/mei/jun10/02.htm

"There are fears that some governments, faced with the difficulties of
sustained austerity programmes, and perhaps renewed banking sector
stresses, might eventually prefer to default on debt. There is a risk
that mounting unease, or a serious default, could trigger a more
serious global funding crisis. From New Zealand’s perspective, heavily
dependent on continued access to international funding markets, the
risk of harm from a significant re-intensification of global financial
stresses would be much greater than that from a concerted European
fiscal consolidation programme in isolation." - Treasury.

Caution would seem the most prudent approach at this stage as regards
to debt. It is not to difficult to imagine the cost of our debt
escalating significantly resulting in certain breach of local
government asset/liquidity ratios.
The only option for local councils would be to raise rates cut
spending/services to cover it ( and blame the economy for the
situation it will find it's self in). Councils operating at the
maximum legal levels (WBOPDC) of debt are putting their ratepayers in
the firing line not only fiscally but socially through reduction in
service levels should this occur. In short the WBOP are gambling on
recovery in growth and have no hedging in place against a more than
possible downside.