Analysis by Federated Farmers shows the consumers’ price index (CPI) went up 21 per cent between 2006-2016. Local authorities have argued the Local Authority Cost Index prepared by consultants BERL is a fairer measure of cost pressures on local government, and that went up 33 per cent during the past decade.
Both measures are dwarfed by the average 77 per cent hike in rates by 13 city, 54 district and 11 regional councils. New Zealand’s population went up by about 12 per cent in the same period, with consequent growth in the rating base, but Local Government NZ had no figures on how much.
Federated Farmers local government spokesperson Katie Milne says the ongoing trend of rates to rapidly out-pace inflation is greatly resented by farmers, for whom council bills can be a significant component of their farm costs.
“But that’s matched by our submissions and lobbying on council costs, and the tendency of some councils to get carried away with growth plans and ‘extras’ with not enough recognition of the impact on the ordinary people and businesses footing the bill,” Katie says.
The level of concern in the rural sector about council costs and activities could well be the reason why rural and provincial voter turnouts in the October elections were significantly higher than in metro centres. Rural voting around New Zealand was an average of 49 per cent, while the metro average was 41 per cent.
While a number of councils have reined in spending, Katie says Federated Farmers wages an ongoing battle with councils in many districts about rates burden unfairness, such as when revaluations push up rural property values.
Other councils put up the rates to fund ‘growth initiatives’ and tourism but overlook the fact that farmer businesses are also significant employers and drivers of district wealth, and it may be just as pertinent to progress to keep their rates bills down, Katie says.