If this year's rate rise at Napier City and Hastings District councils was the same as the lowest in the country at 2.2%, mayoral candidates say it could lead to the closure of facilities, the delaying of roading projects and fewer rubbish bins on streets.
The biggest battleground at Hawke’s Bay’s local elections will be rates. Over in Whanganui, the rise is on average just 2.2%, the lowest in the country.
We asked Napier and Hastings’ mayoral candidates the hypothetical question - What would need to be done to achieve a 2.2% rate increase in their city? And what would we lose if they gave us that?
Any rate rise hurts. But some hurt more than others.
In an already challenging economy, Hastings District Council rates are increasing this year by an average of 15%, the fifth highest rise in the country.
Napier City Council ratepayers will be paying on average 8.9% more.
Hastings mayoral candidate Wendy Schollum said on the surface, a 2.2% rate rise sounded great - “until you ask what would have to go?’.”
In Hastings, it would mean cutting about $17 million from this year’s budget, she said.
“That’s the rough equivalent of closing all public pools, libraries, Splash Planet and Toitoi, while also switching off funding for City Assist,” she said.
“We can’t just accept double-digit rate increases as the new normal either.
“That’s why, as Chair of Hastings’ Strategy and Recovery Committee, I’m already working alongside staff and colleagues to challenge how we do things.
“The bulk of council spending is in core business: Building, maintaining, and upgrading infrastructure. So that’s where we’re looking first.
“We’re reviewing how we fund, plan, and deliver these projects, and checking whether the community facilities we all own are being used and meeting our needs.
“I’m prepared to challenge or cut what’s not working, while also protecting what is. This isn’t about swinging an axe. It’s about using a scalpel.”
Hastings Mayoral candidate Steve Gibson said to achieve a 2.2% increase, he had a four-point plan.
1. Make council more efficient
“Cut costs by working with other councils. For example, sharing senior staff to reduce top-level salaries while keeping services running. Plus, review staff roles to ensure value for money. I’d also support a fresh look at council amalgamation at the next election.”
2. Spend less on consultants/contractors.
“Council spends $241 million in this area. We can bring that down to $230m by using smaller local contractors for smaller jobs and reducing reliance on expensive consultants.”
3. Strengthen financial oversight
“Bring back accountability. I would lower the CEO’s contract approval limit from several million to $100,000. Bigger contracts would be reviewed by the council’s tenders committee, with more weight given to price.”
4. Stop propping up loss-making assets
“Stop using ratepayer money to cover losses of council-owned facilities.
“Instead, shift things like Splash Planet, Frimley Pools, and council housing into independent Trusts. They can then seek government funding and sponsorship.”
Another candidate Marcus Buddo said to achieve a 2.2% increase council’s budget increase would need to be about $17m smaller through cuts, deferrals or savings.
“Our annual plan says we will borrow $92m to cover our capital expenditure for the next year. If we didn’t, we could save 5% in interest costs ($4.6m) and 5% on repayments (another $4.6m).
“If all the critical infrastructure work over the next year, like the Clive Wastewater Plant outfall, the Mangatutu Bridge, the Pohokura Rd slip and many more, were cut, we could save $9.8m. About half of what is needed to get to the 2.2%.”
Looking at council operating, the annual report 2023-2024 indicates what rates are spent on:
“If all aquatic facilities, libraries, economic/community development and governance and support, were cut you’d get over $17m.
“The next term requires a mayor and council that focuses on the finances and affordability,” Buddo said.
The latest councillor to announce his bid for the top seat Damon Harvey said there was a lot to learn from Whanganui, as well as a recent report from the Taxpayers’ Union.
“We need to do things differently, as although residents have always faced rate rises, it has been nothing to the extent of what we are now experiencing and we know that with other cost of living pressures, something has got to give,” Harvey said.
“The levels in delivery of services and investment in future infrastructure projects would be stripped back to the bare minimum.
”We wouldn’t be able to fund the cyclone rebuild work, which also has government funding support. This funding would be at risk.
“Hastings is already behind the eight ball in rate rises due to the recovery from the cyclone - that debt will be with us for 16 years.
“However, my focus will be on ratepayer affordability, greater accountability, while also making sure Hastings is a great place to live.
“I think we need to look at regionalising some of our services and contract for services. Are we getting the best bang for buck and are we supporting local businesses?”
Hastings District Council candidate and past chair of the council’s mayoral finance advisory committee Michael Fowler said candidates standing needed to have a plan.
“Those aiming to glide onto the council table as capped financial super-heroes, advocating radical cost-cutting, I believe, need to have a plan rather than making broad statements,” Fowler said.
We also asked Fowler the questions.
“If a rate increase of 2.2% was applied, council would have to look at drastic service and activity reductions,” Fowler said.
“The increase includes 6% for cyclone recovery. A reduction to only 2.2% in total would mean the recovery would have to be scaled back as the financing costs could not be afforded for the approximate $230 million needed to restore infrastructure.
“The council would almost certainly lose time-bound government funding assistance rates, meaning the $230m needed for its share of the recovery would rise, and financing costs would rise.
“The term of repayment (16 years) would have to be extended, costing more.
“The council’s infrastructure three waters programme was peer reviewed in 2024 by an external company to give council confidence the work was needed. If it doesn’t happen, catastrophic failure or service interruptions of infrastructure may occur.
“Hastings is a growth district, and investment in infrastructure is needed to provide for this.
“To ensure essential infrastructure work goes ahead, cuts would be made elsewhere, meaning services and facilities residents enjoy and use would be reduced, discontinued or take longer to restore.”
Napier’s incumbent mayor Kirsten Wise, who is standing for re-election, says achieving a 2.2% rates increase like Whanganui’s would require significant trade-offs, including deferring infrastructure projects, cutting operational budgets, and scaling back community services.
“But it’s not just about the percentage increase — you also need to consider a council’s current average rates per property,” Wise said.
“A low increase on higher rates can still be a greater burden than a slightly higher increase on lower rates. Over the past 20 years Napier has been among the lowest rates in the country.
“As Mayor, I’ve already led a review of council spending and introduced more transparent reporting.
“If re-elected, I’ll continue driving efficiencies and engage the community on what must be protected versus what can be reduced.
“It’s not just about hitting a number — it’s about keeping our city resilient, affordable, and future-ready,” she said.
Napier mayoral candidate Richard McGrath said the council would have to make some tough calls and define what its core responsibilities were.
“Reassess projects such as the Regional Park, the Waka Hub, and Skink Habitat facility,” McGrath said.
“We would have to be prepared to stop non-essential projects and delay some capital works such as roading projects. We would have to consider things like facility opening hours, how often we clean public toilets, how many rubbish bins we have out in the community.
“Improvements would need to be made to how we scope future projects to ensure that they don’t blow out.
“The Aquarium, I-site, Kennedy Park, Par2 minigolf and Ocean Spa are already being reviewed.
“I would certainly be keen to contact the Whanganui council and learn from them as to how it could be replicated in Napier.”
Napier mayoral candidate Nigel Simpson said without studying their Annual and Long-Term Plans, for most councils, a rates rise of that amount would be unsustainable to maintain council function and services.
“I’m sure ratepayers would be pleased, but the council would need to cut services and avoid large capital projects, defer maintenance or increase borrowings to offset budgets normally met by rates.
“With the CPI sitting at 2.5% at April 17, a 2.2% rates rise would be a rates cut of 0.3% plus whatever inflation is over the next 12 months and would result in cuts to services or staff and a reduction to capital project investment.
“The council would go backward.
“One significant component of local government cost is salary and wages.
“The latest Labour cost index demonstrates the lowest local government sector increases for each quarter over the last year was March at 3.2%.
“So if a council only increased rates by 2.2% they would either have a wage freeze or reduce staff to match. If council retained all staff, significant reductions would have to occur elsewhere.”
Hastings rates have increased an average 48.76% over the three-year electoral term from 2022-2025 - the fifth highest in the country over the same period.
The lowest increase this year is Wairoa District Council at an average of just 5.20% with its three-year total at an average of 39.04%.
Central Hawke’s Bay District Council’s rates rose on average 42.90% in three years, with this year’s increase set at an average of 7.40%.
Napier’s three-year cumulative increase is on average of 43.30%.
Hawke’s Bay Regional Council rates increased an average of 9.9% this year, while the three-year term rose by an average of 35.13%.
Mayor Andrew Tripe said this year’s low increase didn’t happen by accident – it was the result of a deliberate strategy to keep costs under control.
“One of my five campaign focus areas was for a more efficient council to reduce the rates burden on our community.
“In response to this, early in the electoral term, a six-point plan was developed to reduce council costs and ease reliance on rates.
“The plan looked at improving efficiency, reducing council services, finding alternative funding for projects, identifying non-rate sources of revenue, and growing Whanganui’s population so there are more households to pitch in on rates.”
Deferrals included $8 million of planned spending for 2025/26 for the opera house upgrade while the business case is progressed and the Waitahinga Quarry development project.
LDR is local body journalism co-funded by RNZ and NZ On Air.