A former Rotorua mayor says the proposed annual plan needs an urgent rethink and councillors need to put aside personal differences.

Grahame Hall served the Rotorua region as a councillor from 1979 to 1992, when he was elected as mayor, a position he held until 2004.

This week, he took the unusual step of speaking out against what he calls a "business-as-usual" approach in the council's proposed 2020/21 annual plan.

The draft annual plan will meet its final hurdle on July 9 when it is considered for adoption by the full council, and proposes targeted rates rise of 4 per cent to pay for wastewater, water supply and waste management services.

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The annual plan also proposes to use debt to fund a $4.5 million a short-term operational shortfall.

Hall said an organisation that had to borrow to run the business and balance the books was "in deep trouble".

"What that says is that they can't afford to continue with all their projects and run the business. They've got to borrow to run their business.

"I don't think they're having a good hard enough look at where they can save their money.

"By racking up the debt it means they're going to take the flexibility away from future councils.

"I appreciate it's a tough, tough job to cut things out, because everybody wants to have the projects go ahead."

He said, in his view, the council needed to reassess its major projects - such as the lakefront redevelopment, Kuirau Park, the Sir Howard Morrison Performing Arts Centre and the museum - not stop them altogether, but slow them down.

"They've got themselves in a big hole … because they've got too many major projects going at once.

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"I think they need to reassess what they're doing ... and see whether they can do more phasing, staging of [major projects]."

"It will hit the wall sooner rather than later if they just keep doing what they've been doing."

He said the council should be asking for "big savings".

"That's what [the] council are there for, that's what they should be doing, but I haven't seen any evidence of it in the annual plan or any other information that's coming out.

"In the annual plan, they're showing costs for next year - they just go up and up and up and up. What are they doing to stop the annual costs going up?

"Every single one except arts is going up. Why haven't they got that under control?"

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Rotorua Lakes Council building. Photo / File
Rotorua Lakes Council building. Photo / File

Hall believed council "in-fighting" was also getting in the way of robust decision-making.

"Everybody comes up with some good ideas sooner or later but if people don't take it on board, or say 'we've got all the answers', then it's going to be hard to get the right strategic decision, and it's going to be hard to get the right decision for the ratepayers.

"Good leadership will ride over that. No matter how bad people are, there is a hell of a lot of good in them, and it's a matter of bringing that out."

He said if the council did not act fast to reassess the Annual Plan, there would be rates defaults this year and rates rises in the future.

"I would like to hope there is time for them to do something about it.

"I think we can do a lot better for the long-term benefit of Rotorua. I'm not saying everything's bad. There are some really good things happening here.

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"I am saying I don't believe we've got good control over our expenditure and our strategic thinking and planning, given the current circumstances we're facing.

"It's time to take a step back and have a really good look at it, I hoped that would have happened - it hasn't happened."

Incumbent mayor Steve Chadwick said the council was focused on doing all it could to cushion the impact of Covid-19.

"It's a time for bold leadership and innovation, to back our community and in particular our business community. It's not a time for old thinking that is off the pace and out of touch.

She said she was hearing "first-hand" that people wanted the council "to get on with it and to move at pace".

"At a challenging time like this, retrenching and reducing services and staff would just send us backwards.

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"We are fortunate Rotorua Lakes Council is in a good position – and that hasn't always been the case."

She said in 2013 she inherited an organisation that had "a poor relationship with iwi, a failed sewerage project, a history of unsuitable low rating driving high levels of debt, and under-investment in infrastructure giving rise to failing facilities, amongst other things".

"Negativity and hand-wringing is not what we need. Our annual plan is a progressive plan to enable us to move forward.

"I have huge respect for [Hall] but we all have our time and a lot has changed in the 16 years since he was mayor.

"The local government sector, legislation and expectations have changed.

"There is a totally new paradigm, new ways of working, localism, partnerships – it's not just about essential services and infrastructure anymore.

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Councillor Peter Bentley said he "totally agreed" with Hall's statements.

"He has totally captured what is wrong with this council and it is scary.

"We are going to hogtie future councils' ability to provide good infrastructure and our debt level is going to be eye-watering."

Councillor Reynold Macpherson said there were now two former mayors "making extraordinary efforts to correct flaws in the leadership of current decision-making processes".

On Tuesday, former mayor Kevin Winters, who succeeded Grahame Hall, spoke against a council proposal to outsource wastewater management.

Macpherson said it was time for "leadership of reconciliation, accommodation and collaborative planning".

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Councillor Merepeka Raukawa-Tait said the council could not "shrink our way back to a recovery" and it had taken advice from overseas and New Zealand's best economists.

"Councillors are working hard in this uncertain climate, we know what's at risk if we get it wrong."

The council, as an organisation, did not wish to comment on Hall's statements.

Deputy mayor Dave Donaldson and councillor Mercia Yates declined to comment on Hall's statements, while the remainder of the council did not reply to a request for comment.