Property council backs regional rates rise to fund transport

Auckland local bodies seeking higher regional rates for public transport found an unlikely ally yesterday in the New Zealand Property Council.

National director Connal Townsend, whose organisation represents about 500 property firms and professionals, stunned the Auckland Regional Council by advocating a more liberal approach to its transport funding woes. He called a proposal to limit regional rates rises to around 5 per cent for each of the next 10 years "far too tight" given the shortfall, which could exceed $1.4 billion after lost Government public transport subsidies are added to a $710 million council deficit.

"You need to be more flexible," he told councillors.

"If it comes as a shock and surprise, I make no apology. Everything we stand for is about the viability of this city - so many of our members' investments are wrapped up in Auckland."

Mr Townsend said public transport was a vital driver of economic sustainability, and unless solutions were found to the funding crisis, Auckland's central business district would die.

He acknowledged that the Government was making a substantial contribution to Auckland transport, but said he was not convinced it was being as helpful as it could be.

Calls by Auckland and Manukau cities for higher regional rates rises were reinforced yesterday by the Waitakere and Papakura councils, but Rodney District Mayor John Law said rates were an "antiquated" funding tool which should be abandoned.

Although his own council is considering a 9 per cent rate rise, he suggested public transport be funded by other means such as a regional petrol tax or infrastructure bonds, a device the Government announced last week it would start using to build highways.

Mr Townsend's advocacy did not extend to a 60 per cent rating differential which businesses have to pay the regional council over residential ratepayers, nor to a levy the council wants the Government to let it impose on new developments.

But it was a marked departure from the stance of Auckland's Heart of the City business association, which earlier yesterday rejected local body calls for higher rates and said just a fraction of the Government's surplus would fix the region's public transport.

Chief executive Alex Swney told councillors that for every $20 in taxes paid by Aucklanders to the Government, only 20c went to the regional council for public transport, parks and an increasingly broad range of services.

"A small reduction in the Government's revenue would result in a huge increase in the ARC's revenue," said Mr Swney, who last week called Finance Minister Michael Cullen "a small-town provincial bully" for telling the regional council its rates were too low.