Wagner Nicky: Estimates Debate — In Committee 
Wagner Nicky: Estimates Debate — In Committee 
[Volume:656;Page:5831] 
NICKY WAGNER (National) 
: 
 We have heard a whole lot about Auckland today and as an MP from Christchurch I want to talk about local government right across the country. This Government’s priorities are to grow the economy and create prosperity and with that to provide security and opportunities for all New Zealanders. Effective local government is an important part of this equation. 
A critical issue for many New Zealanders is managing their rates payments. Rates are increasing and are placing a bigger burden on ratepayers who are already stretched in these difficult economic times. In the past rates have risen much faster than inflation. From March 2001 to December 2008 under the previous Labour Government the consumer price index for all groups increased by 23 percent but the consumer price index rates subgroup increased by 61 percent over the same period. This level of rates increase is totally unsustainable and it is no wonder that ratepayers were in revolt. 
The problem is significant because rates are the single-biggest source of council income and the costs of local government continue to increase as the demands and expectations of citizens outstrip the ability of ratepayers to pay. The result is that many councils are struggling to meet their statutory commitments. They are struggling to provide for the necessary infrastructure and services that their communities demand. An analysis of data from the newly released long-term council community plans shows that the upward trend is continuing. Despite efforts to keep the costs down inflation growth and community expectations continue to generate increases. The projected cumulative increase in rates income over the next 10 years is 59 percent and at the same time public debt for the sector is forecast to increase by 100 percent and operating expenditure by 37 percent. These figures are unacceptable and they are unsustainable. Something has to change and this Government is absolutely focused on finding ways to manage the cost of rates. 
But in the meantime the Government responding to the pressure from struggling low-income homeowners of which there are over 110000 this year has allocated $65 million out of the total funding of $90 million for Vote Local Government—that is 72 percent of that funding—to the Rates Rebate Scheme. In 2008-09 the average rebate was $483. These changes will lift the maximum rebate from $530 to $550 and raise the income threshold for eligibility from $21180 to $21910. 
But this is only a stopgap measure. It does not address the real problem. We must find ways to control council costs capital expenditure and activities and to improve the transparency accountability and fiscal management of local government. We have heard the Minister pledge today to do just that. Over recent years there has been widespread concern about the growth of local authorities and the choices some councils have made in their funding decisions. Ratepayers and citizens want to be given better tools to be able to have their say in what is done with their money and on their behalf. After all ratepayers have to carry the consequences of expenditure decisions by their councils so it is only fair that they have a greater say in council decision-making. We are looking to simplify the long-term council community planning process. It is enormously expensive with some councils spending up to $1.3 million just on doing the planning every year. We want to develop plain-English financial disclosures so that every ratepayer has at least a chance to understand where the money is going. We want to streamline the compliance processes. Thank you.