The Christchurch City Council draft annual plan for 2022 proposes increasing rates by an additional 4.82%.
Assuming that this rate rise proceeds; the Dalziel-led council will have super-sized the average residential rates bill by 60% since 2014, grossly outstripping consumer inflation and compounding the cost of living.
Will the next mayor of Christchurch have the courage and resolve to bend the arc on our runaway rates track?
When a person stands for a Mayoralty or Councillors position anywhere throughout the country, do they have that resolve to bend the arc on the runaway rates track?
We don’t know if they do and why don’t we know?
Most times the question never arises but it is a question that needs to be asked of all people who wish to stand as Mayors or Councillors on Regional or District councils throughout the country.
The residents and ratepayers should be deemed as shareholders to the Mayors and Councillors not a money tree as they appear at the moment. We see people who stand for roles in local government who have an agenda to build or do something’s that they consider are, or should be, a core business objective of the council, often without any cost benefit analysis study.
If these people made the hard choices in relation to council spending instead of promoting what are in a lot of cases, issues that are more feel good than must have, we might see a more conservative but much more valuable use of the ratepayer’s funds.
They must always remember that the positions they aspire to, are actually to work on behalf of the ratepayers, who both elect them to the positions they hold and also pay their salaries through their rates bills; and they need to concentrate on the basic needs that sustain a good community like roads, libraries, playgrounds, drinking water, waste water, storm water and important infrastructure.
Currently we see many policies and plans coming from central government that are driving local councils to do things that aren’t essential services required to support the ratepayers and to make communities great places to live.
We need to see local government (regional and district councils) more often challenge central government and tell them that councils role is to provide and maintain the basic infrastructure that is required to support the ratepayers abilities to live in their selected council area and maintain the natural environment in that area which allows that to occur.
Currently we are seeing rates rising, both faster and higher, than wages and the cost of living increases, particularly in areas that were once considered to be the lower socio-economic area of local councils. One of the consequences of this rapid increase in rates is the influence this has on the property valuations. This spiral of increasing rates and rising property values causing further rate rises means that the lower socio-economic members of our communities are seeing their rates rising faster than their ability to pay those rates.
They are seeing the government valuations on their properties rising faster than the top end properties and hence the rates burden is shifting. Once the lower valued paid less but now they have caught up to the higher valued properties. As rates are are raised on GV’s then the bulk of the rates bills are shifting from the wealthy to the poor.
One issue that needs to be asked of all of our mayoralty and council candidates is in regard to rates rises.
The challenge and questions for all who want to stand for these next local government elections is; have they got the resolve and courage to reduce rates and if elected to challenge the bureaucracy of the councils that they are elected too?
Many people stand as local council candidates in support of what they consider to be worthy causes, which they think are important, but they don’t first consider who will pay for those causes if they succeed in being elected. Often those causes get actioned once people are elected to a mayoralty or council position, and in most cases they end up costing a lot more than the original estimates. This ends up adding to the spiralling debt load for councils (and the ratepayers who must fund these causes) and end up with the council raising the level of rates to cover the debt load.
We are now at a stage where people are finding it difficult to survive let alone find more money to pay increased levels of property rates to fund feel good vanity projects that are needed solely so that the newly elected candidates can say that they have done what they promised, regardless of whether it was of benefit to the ratepayers.
A classic example of this type of situation is the case of the Edgeware Pool in St Albans, Christchurch. Six years ago, the Christchurch City Council agreed to sell the Edgeware Pool land to St Albans Pavilion and Pool Group for $1.
As part of the agreement, the council explicitly stated it would not contribute to the project “in any other shape or form” either to develop the initiative or to keep it running in the future.
Two years later, the Waipapa Papanui-Innes Community Board, supported by the pool group, called for the council to fully fund the $5m facility.
In June 2018, the council backed down and agreed to grant $1.25m to the pool group in the 2022/23 financial year, contingent to the group matching the council contribution and funding the remainder of the project.
But now the council is proposing spending $3m on the scaled-back project, if the pool group can raise the remaining $1m.
There’s also an expectation that the community pool will need to convince the council that it can operate the outdoor facility without requiring ongoing operational funding handouts.
One of the current councillors a chief proponent of this proposal has been asking if there is anything people can do to help promote this “worthy cause”.
This is often the problem with the councillor’s mentality; they allow themselves to be perceived as an endless money-tree, the great provider and a glorified city charity, supporting these “worthy causes”.
Another key backer of this pool project is a councillor who when he first ran for council in 2016, vowed to support keeping annual rates increases to below inflation.
He stated that if it means delaying or scrapping ‘nice to haves’, so be it; having Councillors congratulating each other for a 5% rates increase is not acceptable. But with his support for this current pool proposal, he is failing to walk that talk.
His support for the Edgware Pool funding is a change in tune from his frugal rhetoric just a few years ago, when he complained about the proliferation of suburban council pools, given the colossal ongoing costs. The council’s aquatic facilities currently chalk up an annual operating deficit of over $9 million.
Every candidate in the upcoming local council elections across New Zealand should be compulsorily required to give at least a basic explanation of what they consider to be priority spending of the ratepayer’s money, and how they expect to hold rate rises to; at or below, the rate of inflation, or even lower future rates bills for those communities which they wish to serve.
Every candidate in the upcoming local council elections across New Zealand should be compulsorily required to give at least a basic account of the cost benefit analysis for any major projects that they wish to promote as part of their election campaign.
Both of these requirements would go some way to forcing all candidates to think about controlling the current run away levels of council spending and giving the ratepayers some value for their rates money.
We are sure that fiscal prudence and rates restraint will be a critical battleground issue in the local body elections coming up later this year particularly in light of the economic situation after the advent of the Covid pandemic.
Peter Buckley & Andy Loader
Co-Chairmen, P.L.U.G.
Primary Land Users Group