Wellington city councilors have voted to enter the government’s scheme to pay for fixing leaky homes. They didn’t seem to have any other choice. But they haven’t yet had to decide how the city will find the $88million, the estimated amount which the council will have to pay for its 25 per cent share of repairing Wellington’s leaky homes. They’re no doubt relieved they haven’t had to deal with this during the election campaign.
Council staff have told them there are only three options, all equally unacceptable: Increase the rates. Cut back services. Increase debt. None of these would win votes for anyone. All three may have to be used.
The decision to enter the government’s scheme was made at a meeting last night, when councilors accepted a staff recommendation which said: “The council will be better served by accepting the [government] proposal than continuing with the existing litigation-only route.” They had to accept that the council “has an existing liability”.
Some of our elected representatives are concerned that the cost will be higher than the total of $88million (which is made up of a forecast $70million of new claims plus $18million which has already been budgeted.) Claims are expected for 1250 dwellings. Again, the number could be higher.
Councilors have been warned – in a masterly piece of understatement – that “any rates increase … may have some effect on a large proportion of the community.” They’ve also been told that “affordability for ratepayers” will have to be considered. But not till after the election. Our newly-elected or newly re-elected councilors won’t have to make the tough financial decisions till they’re safely into their new three-year term.
The possibility of another increase in rates should be concerning every voter. But strangely, or perhaps calculatedly, the $88million – representing the council’s 25 per cent share of the cost of repairing the city’s leaky homes – has not become an election issue. Very few councilors have mentioned the subject. It’s not mentioned in the campaign messages from the mayor, who didn’t vote last night because of a conflict of interest. (There are reported to be leaks in her Oriental Bay apartment block.) And how to find the money? Not one councilor has come up with any acceptable suggestions.