Gordon Campbell | Parliament TV | Parliament Today | News Video | Crime | Employers | Housing | Immigration | Legal | Local Govt. | Maori | Welfare | Unions | Youth | Search

 

Rates report highlights need for more funding

MEDIA RELEASE

Rates report highlights need for more funding

12 March 2008

Implementing the six recommendations from the Report of the Local Government Rates Inquiry relating to the use of rating tools will not achieve significant benefits for ratepayers without additional funding from outside the rating system.

This is the conclusion from No Magic Answers, a report released today by Local Government New Zealand and the Society of Local Government Managers (SOLGM).

No Magic Answers presents the results of modelling undertaken by 20 councils to determine the impact of the Rating Inquiry’s six recommendations on the use of rating tools.

“The results don’t offer any significant benefits for residential ratepayers in our cities, although some provincial and rural residential ratepayers may gain. The results show the commercial sector would be clear ‘winners’ from these recommendations and rural ratepayers would be clear ‘losers’,” said Basil Morrison, President of Local Government New Zealand.

“In cities rates are likely to shift from the commercial sector to the residential sector, with one case showing a shift of as much as $38 million. In provincial and rural areas, rates are likely to shift from the town (both the residential and commercial ratepayers) to the rural ratepayer,” said Mr Morrison.

The shift in median residential rates could range from a $650 annual decrease per ratepayer in a provincial council to a $600 annual increase per ratepayer in a city council. These figures represent only the impact of redistributing rates as the Inquiry recommended, and do not include future allowances for cost increases, changes in services or the effect of future changes in the level of funding from Government. Some local authorities may be able to reduce some of the extremes created by the shifts through the use of targeted rates.

“Without additional funding from sources other than rates, all these recommendations achieve is to move rates from one sector of the community to another - rearranging the problem rather than actually solving it.

“It’s ironic that one of the key results shows many urban residential ratepayers are likely to face higher rates than they would have before the Inquiry started, unless there is more funding from outside the rating system.

“We continue to push the case for additional funding for long-term investment in network infrastructure, and will not be limiting our advocacy to the recommendations in the Rating Inquiry report.

“The 2006-16 LTCCPs highlighted that development of our infrastructural networks is at a cross-roads. Underinvestment now will have consequences within the life of the current LTCCPs, not in 20 – 50 years down the track.

“The 2008 budget represents an opportunity for the Government to walk the talk on sustainability and make an investment in the long-term economic future of this country”, said Mr Morrison.

Mr Morrison emphasized the Local Government Rates Inquiry was independent advice commissioned by the Government. The Government is still considering these recommendations as part of its evaluation of the Rating Inquiry. No Magic Answers models what could happen under certain scenarios but does not indicate any intention of these councils to change their current rating tools.

Copies of the report can be found on the ‘what’s new’ section of www.solgm.org.nz and www.lgnz.co.nz .


Note for editors:

The following were the recommendations from the Report of the Local Government Rates Inquiry report which were modelled in No Magic Answers:

- promotion of the capital value system as the basis for setting the general rate (in effect, recommending that local authorities adopt capital value as the basis of the general rate, but not making it mandatory)
- phasing out of differentials on the general rate by 2012
- abolition of powers to set a Uniform Annual General Charge (UAGC) – fixed targeted rates would remain
- removal of the so-called 30 percent cap on fixed charging (although in at least one place the document calls for an increase in the cap to 50 percent)
- retention of targeted rates in their present form
- promotion of full cost recovery (including environmental costs) for water, and metering for water and wastewater disposal (with government assistance to meet the cost of installing the meters)
- the retention of GST on rates (although recommendations elsewhere in the report would see a substantial part of the revenue that this raises given over to fund so-called “three waters” infrastructure).

Local Government New Zealand is the national voice of all 85 councils of New Zealand.


© Scoop Media

 
 
 
 
 
Parliament Headlines | Politics Headlines | Regional Headlines

Gordon Campbell: On The Life And Times Of Peter Dunne

In the end, Mr Pragmatic calmly read the signs of impending defeat and went out on his own terms. You could use any number of clichés to describe Peter Dunne’s exit from Parliament.

The unkind might talk of sinking ships, others could be more reminded of a loaded revolver left on the desk by his Cabinet colleagues as they closed the door behind them, now that the polls in Ohariu had confirmed he was no longer of much use to National. More>>

 

Gordon Campbell: On Labour’s Campaign Launch

One of the key motifs of Ardern’s speech was her repeated use of the phrase – “Now, what?” Cleverly, that looks like being Labour’s response to National’s ‘steady as it goes’ warning against not putting the economic ‘gains’ at risk. More>>

ALSO:

Lyndon Hood: Social Welfare, Explained

Speaking as someone who has seen better times and nowadays mostly operates by being really annoying and humiliating to deal with, I have some fellow feeling with the current system, so I’ll take this chance to set a few things straight.. More>>

ALSO:

Deregistered: Independent Board Decision On Family First

The Board considers that Family First has a purpose to promote its own particular views about marriage and the traditional family that cannot be determined to be for the public benefit in a way previously accepted as charitable... More>>

ALSO:

Transport Policies: Nats' New $10.5bn Roads Of National Significance

National is committing to the next generation of Roads of National Significance, National Party Transport Spokesperson Simon Bridges says. More>>

ALSO:

Gordon Campbell: On Why Labour Isn’t Responsible For Barnaby Joyce

As a desperate Turnbull government tries to treat the Barnaby Joyce affair as a Pauline Hanson fever dream – blame it on the foreigners! We’re the victims of the dastardly New Zealand Labour Party! – our own government has chosen to further that narrative, and make itself an accomplice. More>>

ALSO:

Rail: Greens Back Tauranga – Hamilton – Auckland Service

The Green Party today announced that it will trial a passenger rail service between Auckland, Hamilton and Tauranga starting in 2019, when it is in government. More>>

ALSO:

Housing: Voluntary Rental Warrant Of Fitness For Wellington

Wellington City Council is partnering with the University of Otago, Wellington, to launch a voluntary Rental Warrant of Fitness for minimum housing standards in Wellington, Mayor Justin Lester has announced. More>>

ALSO:

 
 
 
 
 
 

LATEST HEADLINES

  • PARLIAMENT
  • POLITICS
  • REGIONAL
 
 

Featured InfoPages

Opening the Election