Prudent, workable suggestions for council funding

BusinessNZ says the Productivity Commission has listened to business concerns in making its recommendations on council funding.

BusinessNZ Chief Executive Kirk Hope says higher rates on business, unrelated to services received, are a key problem in the way councils currently operate.

"New Zealand businesses pay about half of all council rates but don’t get proportionate services. Business agrees with the Commission’s finding that rates on business should be equal to services received.

"BusinessNZ strongly disagreed with the proposal for a vacant-land tax to be implemented by councils, and we are pleased to see the Commission recommend that this tax should not be advanced, recommending instead that councils should tackle the problem of lack of housing supply by reducing regulatory barriers.

"In other areas, we would agree with the Commission’s recommendations that councils should be allowed to charge for water by volume and implement road congestion charges - but not to impose accommodation levies - and that central government should help pay for more local infrastructure.

"The Commission has heeded BusinessNZ’s recommendation that councils consider selling or part-selling existing non-essential assets to build new, essential assets. This would be a major help in financing new local infrastructure.

"It is to be hoped that the Government will action the Productivity Commission’s prudent and workable recommendations."

ENDS

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