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Speak up-or pay up

Thursday 28 Sept

Speak up-or pay up.

I know Council politics and stuff is boring, but I bring news. There is a plan to take more dollars off you. You are about to receive a fab glossy, that you paid for, which sells the plan to establish a new Regional Council Committee which will levy new and additional rates for Wellingtons “economic development”.

Sorry, I got that wrong. It won’t ask for higher rates. Silly me. Its not about higher rates. Its about “investment”! Do you agree to “invest” more of your income with them in “growth”, in “securing our future’, in backing “a leadership team with the muscle to succeed”. Get the picture? And all we ask is $3.50 extra a year if you live in Wellington, $6 in Lower Hutt and Kapiti, $5 in Upper Hutt, $4 in Masterton, and so on.

Funny thing- these small amounts take a minimum extra $3.5 million off ratepayers over the next three years when you add it all up. And this on top of a 25% Regional Council rates increase over these three years!

A forum of Mayors, councillors and advisors has been working on a regional strategy for economic growth. The advisors reeled up a host of irresistible ideas couched in even better sounding words-that will take Wellington onward to wonderful things. We could get first mover advantage, economic transformation, better clusters, more networks, leading innovation, not to mention high value individuals and even more Economic Development Managers.

Better still, apparently Government has lots of dosh that it wants to throw at regions with “plans” like ours.

Fantastic!

So you can imagine the looks of disbelief when the two representatives from Upper Hutt heretically questioned or disagreed with many of the proposals as they were raised over the last year.

Using ratepayers to establish and fund a Landbank that buys land that may be considered important for various reasons? Not for me.

Raising rates even further so the strategy can invest in “regionally significant projects”, such as Waka ama Regatta, the Karori Wildlife Sanctuary, or perhaps even to help start businesses? On top of a 25% increase? Nope.

But there were some good ideas-maybe the Centres of Excellence could succeed, not sure about whether rate payers should pay for them. But worth consideration.

Finally, we got a ballpark guess at the costs for all these strategies- estimated at around $7.4 million-up to a maximum $11.25 million, a year. Currently, the Councils individually put in around $3.9 million a year into economic development; so we were looking at a net increase of at least $3.5m. “Do not agree, we should be trying to reduce rates, not lift them further”.

Some such as Lower Hutt agreed, and so the proposed budget got hauled back to an extra cumulative total additional rates of $3.5 million over the first three years.

That then is the brief history of the plan to create a new regional rating power for the Regional Council.

I do not agree with increasing further the already huge increase in Regional Council rates from 25% to 28% over the next three years, taking an additional $3.5 million off ratepayers.

But my greatest concern is that this is only the beginning. It will only be a short time until the rate demands grow up toward the discussed top limit of $11 million, as ideas such as the Landbank, put in the bottom drawer for now, and the cost of setting up a new bureaucracy, emerge.

I have not been able to get the full costs already being picked up by ratepayers of this strategy. Could it be that the launch and consultation alone over the proposal will cost in the vicinity of $200,000? And what is the cost of staff, directors, and other resources in the strategy commit ratepayers to? I would estimate it already at around two hundred thousand a year. A total around $400,000, and it has hardly started!

Finally, I do not agree with using the regions ratepayers to fund a Land Bank, or funding projects such as the Waka ama Regatta or the Karori Wild life Centre, especially when we already have high rates increases imposed on us.

I once had the privilege as Minister of Business Development of visiting most of New Zealand’s business development agencies. Remarkably, every agency claimed to be achieving massive success. But no-one could really measure this or prove it.

I learned a great deal. And part of that learning was that the full costs and benefits need to be thoroughly tested and assessed, and evaluated against the alternative of not over taxing households, before that hard to reverse decision is taken to tax us more.

There are some good ideas, some good people involved, and it is important for local politicians to work together for Wellington.

But we should advance on a project by project basis, see if they work, and stay within the current $3.9 million budget.

But it’s your call.

ENDS

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