Rotorua could face future infrastructure issues if spending on essential services is not increased - say a local ratepayer group and council commentators.

The call comes after the Assistant Auditor-General said essential infrastructure in New Zealand was not being looked after with councils not spending enough on water, sewers, flood barriers and other services.

Read more: Edgecumbe flood review panel granted more time
Bay of Plenty projects up for national awards

But, the Rotorua Lakes Council says, Rotorua's infrastructure is in good shape and the organisation aims to spend up to 85 per cent of its annual infrastructure budgets maintaining and building on the district's infrastructure assets.


Councils are responsible for supplying and maintaining drinking water, wastewater, stormwater, flood protection, roading and footpaths.

Assistant Auditor-General Andrea Reeves told Radio New Zealand (RNZ) recently councils could struggle to maintain service levels, leaving future generations to foot the bill.

She said the numbers she had analysed did not reveal the state of councils' pipes or roads, but showed local bodies spent only 70 per cent of what they had budgeted for those items in 2015-16.

"It could be an indicator that you're not adequately reinvesting in your assets, and that could mean the cost to reinvest in assets in the future could actually fall on future generations," she told RNZ.

She said the office would continue to keep an eye on underinvestment and said councils should be prepared to justify their decisions.

Infrastructure New Zealand chief executive Stephen Selwood said councils were deferring work on ageing assets, putting them at risk of failure.

"There's no question that the infrastructure assets across New Zealand are struggling through councils not being able to renew their assets, not being able to afford to fund key investments when they're needed, and not keeping pace with growth," he said.

Rotorua deputy mayor and Economic Development portfolio leader Dave Donaldson said the council had a strong focus on providing infrastructure for growth and maintaining assets.

"I think we are striking a good balance on our infrastructure. We budget to spend 85 per cent of our infrastructure budget each year and this year we may get a bit more of that completed."

He said this year the council had signed off on two major infrastructure projects - the upgrade of the wastewater treatment plant and a sewerage scheme for East Rotoiti and Rotoma - both worth about $30 million.

"But, we have to be mindful of our debt as we move ahead with any of those schemes."

He said the council had a self-imposed debt to revenue ratio of 175 per cent, that could legally be increased to 250 per cent.

"If we are going to provide infrastructure for future growth that debt level is something we would need to discuss with the public," he said.

However, the Rotorua District Residents and Ratepayers chairwoman and former district councillor, Glenys Searancke, said over the last nine years the council had deferred a lot of maintenance work.

"For example, we had a policy of doing 10km a year of rural resealing, then it was 7km and then down to a million dollars a year, which does not get you a lot.

"In the past we have been up to the play when it came to infrastructure but now we seem to have gone to more fancy things like airports and artworks.

"You have to keep your house in order. It's not just the filling of potholes, whole roads need work.

"It seems our core business has changed and the council has got into areas it should not be in," she said.