Tag Archives: rates

29/08/2025
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Local body politics

What the heck is up with the rates?

Rates are going through the roof and people are struggling. Even so, I’m going to say something that most mayoral candidates won’t admit. Rates are going to keep going up and anyone who promises that they can stop that happening is lying to you. The Government would sack the council and install commissioners if we did what it would take to stop rates increasing.

Let me explain. Rate rises are being caused by three things: increased debt levels, inflation and the need to upgrade our water infrastructure.

First our debt levels have risen. All councils use debt to pay for long term assets like infrastructure, as a way of spreading the cost over the life of the facility. Recently our Council has been borrowing money to pay for operating expenses – the day to day costs. That’s like borrowing money to pay for groceries and is something I have opposed. In fact I led a revolt of councillors against the mayor’s plan in 2023 to borrow even more to keep rates down. That debt has locked in substantial rates increases for the next few years.

Second, we have all seen the cost of living rise due to inflation. Council costs have gone up more than households because of the kinds of things we spend most of our money on eg. construction.

Third, we need to upgrade our water infrastructure. For decades the council has underinvested in this and it’s now catch-up time. This will be the biggie for the next few years. I will write at another time about possible pathways forward but the reality is that the government standards have changed and we need more expensive systems to meet them. Estimates are that we need $200 million over the next 10 years and it won’t stop there.

It is incorrect to say, as some do, that rates rises are because council spends money on “nice to haves” like the council building upgrade 3 years ago, the Mitchell Park upgrade, the Boat Harbour and the Rex Morpeth redevelopment. The council building work, which was primarily about earthquake strengthening the Emergency Operations Centre, adds about $50 a year on the average rates bill. The Mitchell Park upgrade costs the average ratepayer less than $2 a year to provide some decent public toilets and add drainage. The Boat Harbour wasn’t funded out of rates at all. At the Rex Morpeth / War Memorial hub the Council has only budgeted money for essential maintenance such as fixing the leaking roof. There is also a small amount to rescope the proposal to something more affordable and to develop a plan to get outside funding to pay for it.

If you look at the council’s budgets, almost all the money is spent on core functions such as hard infrastructure (roads and pipes), community services (the library, swimming pool, sports fields, community halls etc) and things that central government requires us to do. Despite what some candidates say, the only way to stop future rates increases is to not upgrade water infrastructure. That would put the community’s health at risk and put us in breach of the law. It would almost certainly lead to the sacking of the council and the appointment of commissioners.

Cutting out all the so-called “nice to haves” won’t make a significant difference to the rates, but it would suck the life out of our district. I do think there are other things we can do to help control council costs, but they are not enough to stop rates rising. These include:

Less use of outside consultants. It means more staff if we want to bring more things in-house but it would save us money and retain expertise in the organisation.


AI is changing how people work across the globe. We need to carefully make use of new technology such as AI to boost productivity.

The Mayor needs to champion our district. They need to work with outside funders to help pay for community assets, leverage relationships in Wellington to unlock government funding and get the councillors working as a team.

Finally we need to work with other councils to pressure government to fix the funding model for councils. Taking GST off rates and / or returning a portion of the GST raised in a district back to the council would help a lot, as would the Government paying rates on its properties.

I have said that I want Council to be more open and transparent. I won’t spin a story to try to win votes. If anyone is telling you that they will cut rates, ask them how.


(Published in the Whakatāne Beacon 29/8/25)

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16/06/2023
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Local body politics

WHY I VOTED FOR A 9.5% RATES RISE


People often say they want politicians to be honest. Sometimes that means saying things that they don’t want to hear. That is especially true when it comes to rates.
People don’t need to be told that costs are going up. They see it every time they shop for groceries or get a tradie to fix something. The same is true for council. For the things that council spends most of its money on, like construction and maintenance, inflation is even higher than for households. It probably costs council about twenty percent more to do things this year than last.
It’s not just inflation. Storm damage is increasing. Climate change means we need to spend more each year to fix things up, and spend more money on making our infrastructure resilient for the future. In addition, years of underfunding has meant that there is a large unpaid bill looming. For example waste water pipes in Edgecumbe have remained cracked since the ’87 earthquake and that is causing problems with storm water infiltration into the system. That needs money to fix.
Councillors in the past have at times been more focused on minimising rates rises than doing the work needed. You can understand why. Voters tend to elect people who promise to keep the rates down, and don’t always ask how they plan to do that. Often it’s by making short sighted decisions. An example is Whakatāne town’s water supply. It could have been secured for a moderate additional amount of money when the bore went in at Paul’s Road many years ago but wasn’t, to avoid a rates rise. That decision has led to much bigger costs to try to find a new supply, and we are not even there yet.
In addition to all that, central government is constantly adding new responsibilities to councils but without providing the funding to pay for it. The job of local government is getting bigger all the time.
Plus health and safety now requires two people to do some of the things that used to be done by one, especially people working in remote places, so as to ensure there is back-up if anything goes wrong.
What do we do? We can cut services, but to make any real impact we’re not talking about a planter box here or a painted line there. We’re talking about significantly cutting services – closing libraries, shutting down swimming pools, or the airport, letting our local roads deteriorate (as Waka Kotahi has been doing with State Highways). Council staff have been trimming costs where they can, or deferring projects to smooth out spending, and that has helped keep rates rises below 10%, but no elected council member has supported taking a chainsaw to council services.
Actually, the main way that rates rises have stayed below 10% for next year is borrowing. It’s not an approach I’m happy with. Borrowing to pay for intergenerational infrastructure is a good strategy, but borrowing just to cover the bills is a recipe for long term trouble.
The question that councillors had to decide this year is whether to borrow more money and stay with a 6.3% increase, or borrow a bit less for a 9.5% increase. Ease the financial pain for people now, but with even more pain next year when we have to make up the shortfall, or bite the bullet now to avoid cementing in bigger rates increases in the future.

It was a hard decision. We all know that people are struggling to pay bills as it is. No one wants to add more financial hardship than necessary, but whatever happens those costs are not going away.
In fact by pushing them into the future, they just get bigger. That does no one any good.

Published in the Whakatane Beacon 16/6/23

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