Local Government Minister Simon Watts said councils would initially be required to keep annual rate increases within a target range of 2 to 4 per cent.
“For too long, ratepayers have been hit with steep and unexpected rates increases, adding pressure to household budgets at a time many New Zealanders are already feeling the squeeze,” Watts said.
“Our Government is focused on easing cost-of-living pressures and getting councils back to basics.”
Watts said the cap would give ratepayers greater certainty and encourage councils to focus on essential services, including road maintenance, rubbish collection, pools and parks.
Ratepayers nationwide had faced median increases of 14.2 per cent and 9.2 per cent during the past two years, he said.
“This rates cap is about driving greater fiscal discipline, keeping rates affordable, and ensuring councils are focused on delivering the services ratepayers rely on.”
The target range would include a minimum increase of 2 per cent, which the Government said would help councils continue providing essential services and investing in infrastructure.
However, councils could apply for time-limited exemptions in exceptional circumstances, including when recovering from a natural disaster or responding to events beyond their control.
A second exemption would be available when a council could demonstrate prudent financial management and a justified need to set rates above or below the target range.
Watts said exemptions would not be granted lightly and councils would be required to consult their communities before setting rates.
Water services would be excluded from the cap and would continue to be regulated separately.
The legislation would also establish an independent regulator responsible for monitoring compliance, considering exemption applications, advising on future target ranges and guiding councils through the transition.
The 2 to 4 per cent range would be reviewed every six years and could be adjusted to reflect costs outside councils’ control.
Councils would need to consider the proposed range from July 1, 2027, when preparing their long-term plans. The caps would take full effect from July 1, 2029.
Kineta Knight is a senior journalist and content producer based in Kaiapoi, North Canterbury. She has worked as a reporter for radio, television, online and print, as well as an editor of lifestyle magazine titles. This article was originally published by Chris Lynch Media and is published here with kind permission.
“Our Government is focused on easing cost-of-living pressures and getting councils back to basics.”
Watts said the cap would give ratepayers greater certainty and encourage councils to focus on essential services, including road maintenance, rubbish collection, pools and parks.
Ratepayers nationwide had faced median increases of 14.2 per cent and 9.2 per cent during the past two years, he said.
“This rates cap is about driving greater fiscal discipline, keeping rates affordable, and ensuring councils are focused on delivering the services ratepayers rely on.”
The target range would include a minimum increase of 2 per cent, which the Government said would help councils continue providing essential services and investing in infrastructure.
However, councils could apply for time-limited exemptions in exceptional circumstances, including when recovering from a natural disaster or responding to events beyond their control.
A second exemption would be available when a council could demonstrate prudent financial management and a justified need to set rates above or below the target range.
Watts said exemptions would not be granted lightly and councils would be required to consult their communities before setting rates.
Water services would be excluded from the cap and would continue to be regulated separately.
The legislation would also establish an independent regulator responsible for monitoring compliance, considering exemption applications, advising on future target ranges and guiding councils through the transition.
The 2 to 4 per cent range would be reviewed every six years and could be adjusted to reflect costs outside councils’ control.
Councils would need to consider the proposed range from July 1, 2027, when preparing their long-term plans. The caps would take full effect from July 1, 2029.
Kineta Knight is a senior journalist and content producer based in Kaiapoi, North Canterbury. She has worked as a reporter for radio, television, online and print, as well as an editor of lifestyle magazine titles. This article was originally published by Chris Lynch Media and is published here with kind permission.
10 comments:
I think the main point here is that "Water services would be excluded from the cap and would continue to be regulated separately."
That effectively means there is not a cap on our previous rates, when water services such as Tiaki Wai were included in that cost.
Rates will climb, water costs will balloon, property values will fall ( or stagnate) - and bloated council staffing will remain.
All will change after November, caps will go, Maori seats will be mandatory and a host of other reversals with a vengeance
Why aren't councils being directed to reduce costs and rates by 2 - 4% each year for the next 10 years - which by the time inflation catches up and mission creep gets properly reigned in by budget force, householders/ ratepayers should be roughly at where we are today - but in about 10 years time. The balance might be restored - as it stands now the balance is well and truly out of whack.
The even weirder thing is that a big chunk of the workers at councils are also ratepayers - so why are they not complaining internally as well?
It's a pity he and his party didn't look in the mirror and make themselves play by the same rules.
Is this not to be integrated in legislation until 2029? That's the next ,next election .
I have nil expectation from Simon Watts MP .
With so little reported the public are largely in the dark about Council activity. Much work seems to be backward motivated ie the engineers and contractors determine what they will do. The concrete footpath rejuvination programme is a ridiculous self determining extravagance. As are many traffic control measures. The Council needs a CO2 accountant to rein in concrete extravagance; simple work with great appeal to contractors.
@Barrie Davis, 924am, I can't begin to imagine how much 'miscellaneous expenses' slush will be hidden under the auspices of Tiaki Wai as a result...
I happened to go through my WCC rates a few days ago. 2009/2010: $2128. 2025/2026: $8190.
A totally unsustainable situation unless revised.
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