All city programs, services under microscope in St. John's spending review

The City of St. John's announced a new comprehensive review of spending in all programs and services, and the mayor is hoping the results will help find efficiencies.

Spending in each department will be under close scrutiny, as a new quarterly reporting model is also adopted.

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Mayor Dennis O'Keefe says the more frequent reporting of spending will help eliminate a potentially nasty shock if there are any departments over budget.

"There will be quarterly reporting and reviews so that we know along the way so we know exactly where we are every quarter so there are no surprises, gives us the opportunity to make adjustments and things like that," he said.

Departments have not been given a specific dollar amount to look for in efficiencies, but they will be asked to look for savings.

"Not only efficiencies but, new ways, other ways — more creative ways — of delivering some services and as a result of that reducing our expenditures on an annual basis."

'Could simply have ignored it'

The city's 2016 budget prompted a mixed review, including negative feedback from business owners, local artists and property owners.

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But O'Keefe said the tough budget was a necessary measure.

"Yeah, we had a difficult budget for 2016, and it had to be in order to actually create an economic environment here at city hall that would enable the budget for 2019, 2020 and 2021 not to be as devastating as it could possibly be had we not taken the action that we've taken," said O'Keefe.

"It addressed the economic circumstances that the city found itself in at this time, and we could have not dealt with it and we could simply have ignored it for another year or two and kicked the can down the road, so to speak."

While many people were affected by the budget, O'Keefe said it was a "very responsible budget" given the current economic climate in St. John's, adding the city did not cut as much as it could have.

"We could have cut more at this point in time, and in fact there was a proposal to do just that, but council felt that in this budget cycle the $30 million that we reduced our budget by was sufficient," said O'Keefe.

The city is aiming for the spending review to be completed sometime in late 2017. Senior city staff and council members will be on an oversight committee during the process.

No worry about negative outlook

Meanwhile, Coun. Jonathan Galgay says the city does not expect an economic outlook rating downgrade for Newfoundland and Labrador to affect the city's operations.

Standard & Poor's Ratings Services announced last week the province's credit rating was A — down from an A+ — with a negative outlook.

Moody's Investors Service reaffirmed the City of St. John's rating at Aa2, but reduced the economic outlook from stable to negative.

Galgay, chair of the city's finance committee, said that change is a direct result of the province's rating.

"We rely heavily upon the provincial government — it's our guarantor," said Galgay.

"But we don't believe that this will have an impact on our operations or any type on increases, any type of spending."