Rates rises, road tolls and fuel tax among items in budget ready for public consultation after the Christmas break

Aucklanders face some tough choices on the costs and services of the Super City on their return from the festive season.

Big rates increases and the prospect of motorway tolls or a fuel tax to pay for transport are a large part of a controversial budget going out for public consultation on January 23.

The Auckland Council yesterday put the finishing touches to the proposed 10-year budget, which in the words of Mayor Len Brown determines how much the city spends, and when and where, to ensure Auckland's communities and economy continue to prosper.

"We need to make some tough choices to find the right balance between progress and affordability," Mr Brown said at the start of the budget process in July.

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Since then, there have been twists and turns around the council table. Mr Brown reneged on an election promise to hold overall rates increases to 2.5 per cent. He won backing for a 3.5 per cent rise to reinstate $800 million of cuts to parks and community services after a revolt by Local Boards. For households, the average rates increase is 5.6 per cent next year and 4.5 per cent thereafter.

Yesterday, Auditor-General Lyn Provost appeared before the council and said the draft budget was "fit for consultation". It explained the main issues and choices facing the region, she said.

Ms Provost noted that if the council proceeds with the City Rail Link and does not adopt tolls or a fuel tax the transport programme would "mean lower maintenance standards, minimal improvements to roads, walking and cycling facilities and could result in a reduction in service levels". She said she was not commenting on the merits of the policy content, but considered the disclosures in the consultation document adequate.

Households bear brunt of increase

Rates:

The budget proposes an average rates increase of 3.5 per cent a year, but new revaluations and a gradual lowering of business rates will lead to higher rates for households.

Household rates will rise on average by 5.6 per cent next year and 4.5 per cent thereafter.

About 126,000 households -- more than one in four -- face rate increases of more than 10 per cent next year, 25,000 households face increases of more than 20 per cent and 3738 households face 40 per cent-plus increases.

About 160,000 ratepayers will get a rates decrease. Business rates will fall from 32.8 per cent of total rates revenue to 25.8 per cent by 2025.

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Tolls: A $2 motorway toll or increasing the fuel tax for Auckland motorists by 1.2c a year for 10 years from 2016 and raising rates by 0.9 per cent are being proposed to plug a $12 billion transport funding gap. Both options require the Government to pass legislation for new fuel taxes - and it remains sceptical.

Transport funding: If Aucklanders - and the Government - approve tolls or a fuel tax, the council can start a $9.8 billion capital spending programme on transport over the next 10 years. Otherwise, Auckland Transport will have to cut spending by $2.9 billion. Spending on walking and cycling will come almost to a halt. Public transport services will not improve after 2016 and there will be few roading improvements. But either way, the $2.5 billion City Rail Link will proceed late next year or in 2016. The Government says it will not start funding its share of the rail link until 2020. The project will not affect rates until it is opened, around 2023.

Service cuts: The council has backed off plans for $800 million of cuts to parks and community services, but the budget contains reductions in parks maintenance, such as less mowing and removal of street gardens that are expensive to maintain, standardisation of library hours and reduced spending on community development. Planning and policy work, environmental advisory work and education services will be trimmed.

Q&A: Have your say

What happens next with the budget?

A summary on the 600-page-plus budget document will be sent to every household from January 23. Public consultation takes place until March 16.

How can people participate in the consultation process?
The council will include a questionnaire with the summary which must be returned by March 16. The council is organising 34 Have Your Say events across the city from February 14 until March 14.

Where do people go for more information?
The council is setting up a website www.shapeauckland.co.nz and a rates calculator for people to work out their rates for next year.

What happens at the end of public consultation?
Councillors and Local Board members will be given feedback in April before the budget committee makes final decisions on the budget in early May. The governing body will adopt the final budget on June 25 to come into effect on July 1.