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Rates Promise Won't Fix The Problem

13 April 2005
PR 049/05

Rates Promise Won't Fix The Problem

The Prime Minister’s promise yesterday to provide rates rebates of up to $500 a year will do nothing to solve fundamental inequities in the local government rating system, says Federated Farmers of New Zealand (Inc) National Board member Don Nicolson.

Finance Minister Michael Cullen has said that the property value-based rating system discriminates against both farmers in rural areas and elderly people on low incomes who live in relatively expensive properties.

“While we sympathise with the plight low-income homeowners, including the elderly, having to cope with ever-increasing rate increases, we are very disappointed that there is no relief in sight for the many farmers who pay huge rates bills -- many are paying more than $10,000 are year in rates and are being used as convenient cash cows to disproportionately fund council services they rarely or never use.”

The promised rebates may bring short-term relief for the elderly but with rates continually increasing at over twice the rate of inflation it can only ever be a temporary stop-gap.

“A far better approach would be to tackle the underlying cause of the problem – the high growth in council spending and a grossly unfair funding system.”


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