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Not a time for increasing the rates

by Lindsay Shelton
Is it time to talk about the rates, when there are much more serious things to consider? Well, yes it is. In the pandemic emergency, many people with reduced incomes may have trouble making the payments, specially if they are going up. And there’ve been widely diverging approaches taken by our councils.

Porirua has led the way. It moved quickly to cut back its rates increase from 6.75 per cent to 4.98 per cent, and its chief executive took a pay cut. Mayor Anita Baker said:

“This means that the city will have $1.2 million less than we need to fund our work, but during this time of uncertainty we agreed keeping the rate increase at 4.98% was necessary. It ensures the essential works for our city can continue. However, there are significant cost increases that we will need to look at in next year’s Long-term Plan.” The Council will cover the shortfall from the reduced rates increase by borrowing. The interest per annum for this will be roughly $30K. Mayor Baker says the Council would have liked to drop the rates increase further but that would compromise the city’s basic infrastructure

In Hutt City, the chief executive has also taken a pay cut, and councillors have agreed to review the city’s proposed 7.9 per cent rates rise, with a view to reducing the increase. Mayor Campbell Barry says:

“The Council is reviewing our current income and expenditure in the upcoming budget to identify further areas of savings, and working to reduce the proposed rates increase.  These are unprecedented times, and we simply cannot continue with business as usual… Reviewing our budget and rates increase will take some time, but will make a difference for our community.” 

The message for Wellington ratepayers so far has been less encouraging.

The council, after announcing an extraordinary 9.2 per cent rates increase, delayed a public debate on the subject, and rescheduled it for tomorrow. (On Zoom, no doubt.) But it’s no longer a public meeting. It’s been reclassified as a closed workshop, with no public debate on what is being decided till next week.

Andy Foster has been talking only about “options,” while acknowledging

… there’s great pressure on businesses and Wellington ratepayers due to the current situation, so we’re working through some options for rates to ease the burden that people are currently facing. This includes both the 2020/21 rates and also for the fourth instalment of the 2019/20 year and will be informing the public as soon as we can in order to give people some certainty at this difficult time.

In his daily update last Thursday, there was still no mention of reducing the rates increase. It was the same in his statement yesterday – he told us to avoid busy places, to get exercise in our bubble, and to put wet wipes in the rubbish, not in the toilet. Not a word about rates or pay cuts.

However in yesterday’s fullpage advertisement in the DomPost, after holding forth about all of us facing challenges but “wanting to remain positively the coolest little capital in the world, a place to be admired and loved…” (who writes this for him?), Wellington’s mayor almost got to the point:

“The annual plan is being completely reworked … Councillors are being briefed this week on our city’s finances and how best to respond.”

But still no mention of cutting the rates increase. Only another noncommittal mention of options, (“to alleviate the immediate impact of rates and charges in the current financial year”) followed by a promise:

“I will share the results of these discussions with you by the end of the week.”

Wellington councillors need to look at the quick decisions made by Hutt City and Porirua, and to learn from the fact that those cities have delivered more precise and encouraging messages than have so far been received from the (hopefully) coolest capital.

At least one councillor has raised the issue of a zero rates increase, something that Wellington has never been willing to consider.

It’s not impossible.

The Hawkes Bay Regional Council has done it.

As has the Waikato Regional Council.

Consensus that Councils need to freeze rates

2 comments:

  1. Concerned Wellingtonian, 1. April 2020, 12:27

    It was the wrong way around for a Wellington City Councillor to say that she looked for Andy Foster to lead the way on this. She should be doing it herself. Her approach shows what’s wrong with the way that she approaches meetings – where she should be speaking out instead of relying on cosy behind-the-scenes discussions beforehand.
    Councils are public bodies and we deserve to find out from them what the elected people are wanting to do for us.

     
  2. Graham Atkinson, 1. April 2020, 14:08

    The examples above don’t show a nil rates increase, rather the “aim” of achieving a nil increase. No guarantees when the budget demands begin to bite.