Hon Nanaia Mahuta
Minister of Local Government

11 May 2018

Media Statement

Government to hold Productivity Commission inquiry into local government funding

Local Government Minister Nanaia Mahuta today announced the Government will hold a Productivity Commission inquiry into local government funding.

“Local government is facing a number of funding challenges which if not met will have consequences for our local communities and our country as a whole,” Ms Mahuta said.

“Local government is facing increasing costs for things like three waters, roading, housing, and tourism infrastructure as well as adapting to climate change. And some of the councils facing the biggest cost increases also have shrinking rating bases.

“Rates are rising faster than incomes so simply raising rates is not the solution.

“The Government is asking the Productivity Commission to look at how local government can fund its activities most effectively and fairly.

“The Productivity Commission is independent and has expertise in regulation, local government, and infrastructure.

“The inquiry is expected to start in August and present a final report mid-2019 after consulting with local government and infrastructure sectors.

“The terms of reference are still being finalised and will be released when agreed with the Productivity Commission.

“Information about the inquiry, its terms of reference, and its report will be hosted on the Productivity Commission website in due course,” Ms Mahuta said.

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