Copeland Gordon: Questions for Oral Answer — Questions to Ministers 
Copeland Gordon: Questions for Oral Answer — Questions to Ministers 
[Volume:617;Page:12708] 
4.  
GORDON COPELAND (United Future) 
 to the  
Minister of Local Government 
: Is the Government considering any steps to reduce the rates burden in light of the defeat of the Local Government (Rating Cap) Amendment Bill? 
Hon RICK BARKER (Minister for Courts) 
 on behalf of the 
 Minister of Local Government 
: The Government believes that rates are a matter for local government not central government and has no proposals to change this as this Government believes that local authorities are best placed to make decisions about their rates. The Government does however recognise that infrastructure is a big cost and has provided considerable assistance in this area. An example includes a sanitary works subsidy scheme for which $150 million is planned over the next 10 years. 
Gordon Copeland 
: In the light of the fact that in this House yesterday all parties expressed concern about the high levels of rate increases is the Minister now prepared to accept that the suggestion of United Future of removing GST on rates stands alone as a fair and equitable solution to the problem; if not why not? 
Hon RICK BARKER 
: That is not a fair and equitable solution to the problem because local authorities do provide services. If they were not to pay GST on services it would put them at an advantage in respect of other providers of similar services. If local authorities are to provide services then they should pay GST. 
Hon Dr Nick Smith 
: How can this Government pretend it is concerned about record rate increases when it is dumping on to councils another raft of additional costs with the Foreshore and Seabed Bill in which the Government’s own commentary identifies significant additional costs for councils in reviewing their district and regional plans and in recognising customary rights and ancestral connection orders; if the Government is genuinely concerned about rising rates will the Government pay for the cost of the foreshore and seabed that falls on local authorities? 
Hon RICK BARKER 
: The Government has ongoing discussions with local government and I am sure this will be one of the topics for consideration if local government decides to bring it up in those discussions. 
David Parker 
: Does central government place a straitjacket on local authorities in the way they raise revenue? 
Hon RICK BARKER 
: No under the Local Government (Rating) Act 2002 local authorities have a range of funding tools available to them subject of course to consultation with their communities. These tools include a general rate across the whole district targeted rates and user charges or fees under a range of circumstances. The Local Government Act 2002 also gave a more flexible fee-setting power. 
Rodney Hide 
: In light of his answer is there any quantum of rate increase that would be unacceptable to this Government; if not why not? 
Hon RICK BARKER 
: Unlike the ACT party this party trusts local democracy. Local citizens will decide what is appropriate for them in conjunction with their local council. 
Gordon Copeland 
: What would the Minister say to those on fixed retirement incomes who are hardest hit by savage rate increases to a point where they are in real danger of not making ends meet and will he accept that this forgotten generation would best counter higher rates by allowing them to keep some of their valuable income by removing GST on rates as proposed by United Future? 
Hon RICK BARKER 
: GST is levied on rates because local councils provide services. This Government has not overlooked the retired generation. It was this Government that restored superannuation to the level it was at before it was cut by the National Government. This Government has injected millions of dollars into superannuitants and will continue to do so. We have looked after them very very well. 
Gordon Copeland 
: Is the Minister telling the House that the Government has no strategy to address the rates crisis in Auckland notwithstanding the fact that nearly all parties have expressed grave concern about it; and if the Government does indeed have a strategy can he shed some light on it for us? 
Hon RICK BARKER 
: I would have thought that a strategy about rates was a matter for the council and its ratepayers. It is not for central government to start running local councils.