Followers will have seen our recent report of what Shane Jones of NZ First said at a recent public meeting about local government amalgamation.  We didn’t have the chance at that meeting to ask a question about rates capping, and so we asked the NZ First candidate for the Kapiti electorate, Penny Gaylor, whether (1) NZ First supported rates capping and (2) if they were part of the next Government, would they support bringing it in earlier than 2029.

We have received this reply from Penny, and Andy Foster, NZ First’s Local Government spokesperson:

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“In recent years rates increases in many districts have been excessive, and this is really hurting all ratepayers, but particularly those with limited or no opportunity to increase income. 

The rates capping legislation was introduced to the House just last week – and is now open for submissions. We would encourage everyone to make a submission. 

NZ First agrees with the rates cap. Councils need to demonstrate far greater financial discipline. 

We agree that there should be consideration of bringing forward the application of a rates cap to 2028. Doing so in 2027 would be very difficult because the legislation is unlikely to be passed before Councils are well underway with next year’s Long Term Plans. However there should be the opportunity to give Councils a clear message that loading costs before the rates cap starts could see them being penalised in future years under the rates cap.

Four other points to make. First is that none of this should let Councils off the hook in terms of looking for real savings from within existing operations. 

The second is that Government has a responsibility to reduce the costly imposts that Governments have placed on Councils without compensatory funding support. 

The third is that I am concerned about Government funding support through NZTA for roads and public transport. If this is reduced – and in some districts this is being proposed by NZTA – then it will impact on Council’s overall income, and thus affect rates requirements.

The fourth and most important is that we should be separating core infrastructure from other rates funded costs. There is a major concern that capping rates across core infrastructure could (likely will) lead to maintenance being underfunded. An option for rates capping might be such an exclusion for core infrastructure, but perhaps reducing the initial 2 – 4% target band to some degree.”

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DISCLAIMER:   CRK is not aligned to any political party. Our focus is on how Central Government decisions affect local government — and ultimately, the rates we all pay.  We’ll continue asking the questions and reporting back on what the political parties are actually proposing.