The sound management of Hafnarfjörður municipality

• The operating surplus for the year was 1,129 million króna for A and B sections of the municipal fund.
• Debt-to-GDP ratio falls to 112.1%. The lowest in a quarter of a century.
• Total income for the year was 3.6% over budget, or 926 million króna.
• Operating cash flow was 14.41% of total revenue, or 3,863 million króna.
• Investments totalled 5,289 million króna during the year.

 
The annual accounts of Hafnarfjörður municipality for the year 2018 were presented to the town council today. The financial position of Hafnarfjörður municipality continues to strengthen, despite significant investments during the year and unavoidable borrowing. The operating surplus for the year for Sections A and B of the municipal budget amounted to 1,129 million krónur, compared to a forecast surplus of 799 million krónur. Operating cash flow was 3,863 million krónur, or 14.41% of total revenues. „The annual report of the Municipality of Hafnarfjörður shows responsible financial management and a sound financial position. The municipality's debt ratio continues to fall, and overall operating results are positive and above forecasts.“ says Rósa Guðbjartsdóttir, Mayor of Hafnarfjörður, on the results of the annual accounts presented today. The operating surplus for the year for Sections A and B of the municipal fund amounted to 1,129 million króna. The operating result for the A-part was a surplus of 490 million króna, whereas the budget had provided for a surplus of 213 million króna. Total revenues for the year were 926 million króna higher than budgeted, or 3.61% over the budget.

Investment in essential infrastructure and services

Investments in 2018 amounted to 5,289 million króna. Major projects included the construction of a new school in Skarðshlíð for 2,061 million króna, a nursing home for 850 million króna, and sports facility projects at Ásvellir, Kaplakriki and Keili for a total of around 696 million króna. The purchase price of flats for the council's social housing scheme amounted to 457 million króna, and renovations to St. Joseph's Hospital cost around 113 million króna. Around one billion kroner was spent on road construction. New loans were taken out during the year for a settlement with the Brú Pension Fund of around 2 billion kroner, and for 1.4 billion kroner for the construction of a care home. In addition, a loan of 500 million krónur was taken out for the Housing Office's investment in rental flats for the social housing system. Repayments of long-term debt totalled 1.6 billion krónur, or about 200 million krónur more than the repayments required under loan agreements. 

„The operations of the City of Hafnarfjörður are disciplined and taxpayers“ money is respected. Population growth necessitates the development of infrastructure, alongside the vital maintenance of all the city's assets. It was not long ago that the City of Hafnarfjörður was under special monitoring by the Municipal Financial Supervisory Board, but times have now changed. This excellent result is thanks to the city's management and staff. Through responsible management in recent years, all the foundations of the municipality's operations are in good order, and the town has the means to tackle any challenges that may arise from the economic slowdown now facing us. We therefore look to the future with optimism." says Rósa.

Tax revenues were 236 million krónur higher than forecast. Convergence fund contributions were 270 million króna over the forecast, and other income was 420 million króna over the forecast, of which the booking of income from sold plots amounted to approximately 65 million króna. Expenditure was approximately 416 million króna over budget, a variance of 1.81%. Financing items were approximately 153 million króna higher than the budget. The operation of the departments was in line with the budget, but the main deviations can be attributed to an increase in care fees, higher costs in disability matters, and purchased teaching services. Total assets at the end of the year amounted to 55,971 million króna, an increase of 4,798 million on the previous year. Total liabilities and obligations amounted to 43,191 million króna, an increase of 3,004 million on the previous year. Long-term liabilities increased by 2,944 million króna due to the aforementioned borrowing, the pension liability increased by 525 million króna, while short-term liabilities decreased by 763 million króna.

The population of Hafnarfjörður was 29,791 on 1 December 2018, compared to 29,360 the previous year, an increase of 431 or 1.51%.

The annual report of the Municipality of Hafnarfjörður can be accessed Here