Councils say the rates hikes are due to the rising cost of the basics. Photo / Laura Smith
Every local council in the country is hiking its rates higher than inflation, with some councils raising their rates by five or six times more than the inflation figure.
Annual inflation fell to 3.3% in the June quarter.
The Taxpayers’ Union – which has been tracking rates rises over the past decade – says double-digit rises are becoming the norm and councils should be keeping rises under the rate of inflation by “trimming the back-office fat and canning gold-plated pet projects”.
But councils say the rates hikes are due to the rising costs of the basics, with Infometrics research commissioned by Local Government New Zealand showing the cost of building some infrastructure has gone up by about a third in three years.
Gore District – Local rates up 21.40%, regional rates up 13.66%
Gore District Council says it’s having to pay more for insurance, interest, compliance, construction, chemicals, salaries, IT projects and the reintroduction of kerbside recycling.
Mayor Ben Bell said all councils were trying to fund water, rubbish and roading with “broken funding and finance models”.
Central Hawke’s Bay – Local rates up 20%, regional rates up 16%
Council chief executive Doug Tate said more than 75% of the rates rise is due to the rising cost of providing water, roading and rubbish collections.
More than 30% is due to costs outside the council’s control, such as debt servicing costs for water infrastructure.
Napier City – Local rates up 19.95%, regional rates up 16%
Napier Mayor Kirsten Wise said the city couldn’t afford to not invest in essential infrastructure and services following Cyclone Gabrielle.
”We’re making up for lost time. We can’t leave a situation like the one we have inherited.”
Upper Hutt City – Local rates up 19.93%, regional rates up 20.55%
Upper Hutt Mayor Wayne Guppy acknowledged the rates rises were controversial.
But he said the economy was facing “significant challenges” and the council had “no other funding options” to meet its financial obligations and required infrastructure investment.
Wairoa – Local rates up 19.5%, regional rates up 16%
Chief executive Kitea Tipuna said back-to-back severe weather events have put a lot of pressure on the council’s infrastructure and finances.
He said the council was focusing on key areas like roading, rubbish, the town CBD and the council’s archives storage.
Hastings – Local rates up 19%, regional rates up 16%
Hastings Mayor Sandra Hazelhurst said the council had been looking for millions of dollars of savings and is delaying projects where it can.
However, the district was having to borrow for cyclone repairs, and pay more for insurance, labour, pipes and bitumen.
Wellington City - Local rates up 18.5% when sludge levy is included, regional rates up 20.55%
Mayor Tory Whanau says for decades, “political pressure” has kept rates lower than what was needed to fund and maintain essential infrastructure and assets.
“Councils around the country are now grappling with this, alongside increased inflation, insurance costs and interest rates.”
Westland District – Local rates up 18.64%, regional rates up 27%
Mayor Helen Lash says most of this year’s local rates rise is due to Three Waters depreciation.
Both the Westland District Council and West Coast Regional Council were planning for smaller increases in future years.
Central Otago – Local rates up 18.3%, regional rates up 16.3%
Mayor Tim Cadogan said compliance and basic costs were rising and the council couldn’t keep “kicking the can down the road.
“The responsible thing is to deal with these matters today, rather than leaving it to future generations to inherit these burdens.”
Porirua City Council – Local rates up 17.5%, regional rates up 20.55%
Porirua Mayor Anita Baker said the council had made “difficult decisions” about deferring, stopping or reprioritising projects.
However, the council still faced escalating project costs, delays to water reform, and failing infrastructure due to years of under-investment.
Dunedin City – Local rates up 17.5%, regional rates up 16.3%
Dunedin Deputy Mayor Cherry Lucas said the council was facing rising costs, ageing infrastructure and higher regulatory requirements.
”I’ve had many sleepless nights, worrying about the impact of this increase on our community, but this is not a budget full of ‘nice-to-haves’.”
Michael Sergel is an Auckland-based senior journalist and radio news director who has been covering business, politics and local government for more than a decade. He joined NZME in 2013.