Post-cyclone pain: Anguish over rates rise impact for Napier residents, businesses

Households in Napier are facing much higher rates bills later this year. Photo / 123RF

By Kate Green of RNZ

Napier business associations and community services are concerned at the prospect of a nearly 12 per cent rates hike.

Residents will be paying 11.7 per cent more in rates in the 2023-24 year after the council voted unanimously for the increase on Thursday.

It was going to be as high as 16 per cent, but the council will borrow $3.3 million to lower the burden on residents.

However, community and business groups said it will still hit hard, on the tail of Covid-19, Cyclone Gabrielle and the rising cost of living.

The Napier Family Centre, a not-for-profit organisation that offers financial mentorship and advocacy, said low-wage earners were not the only ones struggling.

“We are seeing more middle-range wage earners coming through our doors needing help to get on the right financial track, because they’re just not making ends meet,” chief executive Kerry Henderson said.

Whānau were already hurting from paying more for the likes of petrol, mortgages and food. Renters would also notice the increase as landlords raised rents to meet higher costs.

“We’re going to have households having to try to find a few extra hundred dollars that just doesn’t exist at the moment,” Henderson said.

Rates rebates, offered to families whose homes were damaged by the cyclone, are due to stop at the end of May.

Henderson said keeping people in healthy homes was paramount for their social and physical well-being.

“We are really in [between] a rock and a hard place. What I’m hoping to see as a flow-on from this is the current rate rebates, and how are they going to be expanded or increased for whānau that are really struggling?”

The rates increase will be broken into two: 9 per cent for business as usual, and 2 per cent for cyclone recovery.

As the council has not put the plan out for consultation, the vote at its meeting on Thursday morning confirmed the increase for the 2023-24 year.

Rates too low for years - mayor

Napier Mayor Kirsten Wise said it was the result of decades of underfunding.

“For approximately the past 20 years, we’ve had the lowest average annual rates increase for any similar-sized council in the country.”

Napier Mayor Kirsten Wise says the council will be reviewing its services to find ways to cut costs. Photo / NZME

Council officers told the meeting the 2 per cent set said for cyclone recovery would equal $1.5 million.

Wise said the council would be doing a “deep dive” review of its services to find ways to cut costs. “I don’t think it’s a matter of trying to find savings. We have to find savings.”

This was likely to come from a reduction in council services. The alternative, she said, was for rates to continue to rise.

Napier City Business Inc general manager Pip Thompson said the increase would hit small businesses hard.

The city had been quiet since the cyclone, as people saved money by cutting back on non-essential spending.

“The increase in costs everywhere is having a huge effect on business, and this is just ... not the icing on the cake, but just another addition.”