Tauranga Council Cuts $9.85m In Costs To Shave 2.1% Off Rates Rise

Saturday, 31 May 2025, 5:06 pm
Article: Alisha Evans - Local Democracy Reporter

Tauranga residents are facing a 9.9% rates rise after the council found extra savings.

Tauranga City Council faced public criticism for proposing a 12% rates increase, down from a projected 20%.

It has found $9.85 million more in cuts to council operating costs to knock off another just over 2%.

These included saving $166,000 by turning public recycling bins - which had high contamination rates - into rubbish bins.

The biggest cost drop, however, came from employee reductions, with at least 98 roles cut and at $12.3m saved.

The council deliberated on its 2025/26 Annual Plan from Monday to Thursday after receiving 968 submissions and hearing from 68 people in person this month.

On Thursday Mayor Mahé Drysdale said the changes and savings made in the plan would flow through to future years.

Drysdale promised he would keep the rates below those forecast in the long-term plan.

The 9.9% overall rates rise was “not as good” as the councillors would have liked, but it was a start, he said.

The council would be looking at every dollar because they needed to be prudent with people’s money, Drysdale said.

“We have to respect ratepayers’ money, and we have to deliver things for as small a cost as we can.”

The community had also told the council more facilities were needed, he said.

“We’ve been dealt a very tough situation where our infrastructure and our community assets are well below where they need to be.”

He said the challenge was finding the balance between delivering projects and reducing rates.

“I’m very proud of this team [and] I think we have delivered a very good balance.”

Councillor Glen Crowther said it was a challenging Annual Plan because they were dealing with past decisions that added costs to the organisation.

A lot of those decisions were “firmly locked into place”, he said.

Crowther said he wanted a lower rates increase.

“I appreciate that a lot of work went into getting to the 9.9%, so I’m not dismissing that, but I think we need to end up lower.”

The council’s operating expenses were still too high, and he wanted work done before the Annual Plan was adopted in July to reduce rates further, he said.

During the four days of deliberations, the council discussed everything from portaloos to tsunami paths in Pāpāmoa.

Tauranga Netball asked for $20,000 to lease five portaloos toilets at Blake Park during the winter sports season.

Drysdale said this was “expensive” and they needed to “get a deal”.

The council decided to buy the portaloos and would be able to pay for this within the current budget.

The Ōtūmoetai Pool, an “amazing community asset” slated for closure, was saved.

The council also agreed to extend the Pāpāmoa shared coastal path from Parton Rd to Taylor Reserve, provided it cost no more than $1m and could be delivered within the council’s current budget.

There were some losers from the deliberations.

Councillors declined ARGOS Gym Sports $67,000 for a new kitchen and cafe facility, and Bowls Matua would not receive $180,000 to upgrade its third green.

Creative Bay of Plenty would also not receive a $77,500 increase in its funding.

The rates increase would be finalised in June when the Annual Plan was adopted.

How the council achieved its savings

• Projects reprioritised or delivered in-house $3.2m

• Reduction in consultants and more use of internal services $3.9m

• Employee cost reductions $9.1m - 98 roles were disestablished with more possible

• Uptake-related kerbside collection cost reduction $900,000

• Interest-related finance cost savings $2m

• Increased user fees $2.3m

• Reduced engagement and education costs $1.5m

• Other organisation-wide cost reductions $5.1m

The extra savings to get to 9.9%

• Further employee cost reductions $3.2m

• Interest and depreciation savings $2.2m

• Process improvement savings $3.8m

- LDR is local body journalism co-funded by RNZ and NZ On Air.

© Scoop Media

Local Democracy Reporting

Content from the Local Democracy Reporting (LDR) service is published by Scoop as a registered New Zealand Media Outlet LDR Partner.