City spending reduced by $325M in recent years, but manager says that may not be enough
Jeff Fielding says cuts could be necessary without an economic recovery
Calgary's city manager says the officials have reduced spending by $325 million dollars over the past couple of years, but that may not be enough to prevent cuts at city hall in the years ahead — unless there's an economic recovery.
Throughout the economic downturn, the city has been doing what it can to save money, including leaving jobs unfilled and reviewing all spending.
City manager Jeff Fielding says the restraint will continue, but unless the economy recovers and revenues pick up, he's running out of tricks to cut spending.
"The last choice in that sort of mix of solutions we have is service cuts, and we're getting closer and closer to that," he said.
The $325 million in savings breaks down as follows:
- Cost reductions and efficiencies — $103 million.
- Intentional cost savings — $92 million.
- Cost savings (one time) — $54 million.
- Utility rate reductions — $41 million.
- Labour cost containment — $35 million.
Fielding says unions, like managers, will be asked to accept wage freezes in upcoming contract negotiations.
Mayor Naheed Nenshi says he'll keep the pressure on administration to keep finding savings to ensure Calgarians get the services they want.
"That challenge is that going forward we have continually been increasing our revenue less than the rate of inflation plus population growth, and I've said many, many times, that you can't always get blood from a stone," he said.
"It's really important for us to go through continuous improvement work, and we need to continue to go through that continuous improvement work, but council also has to determine whether we have adequate revenues to fund the services that we think are important."
But Fielding is warning that if revenues keep falling, that means some tough choices could be in store for the new council after the coming October civic election.
"I'll give you an example, as you know, we have a significant revenue shortfall in transit," said Nenshi.
"So the question is, do you cut back transit service? And how do you prevent from creating a vicious circle where you cut it back so much that fewer people take it and the revenue goes down even more."
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With files from Scott Dippel