John Milford writes in Stuff:
On Wednesday, the Wellington City Council will vote to votes on adopting the Long Term Plan (LTP) and the numbers tell a story that every Wellington ratepayer should be worried about.
It projects that in the next 10 years total rates will jump by 62 per cent – from a total rate take of $241.4 million to $393.4 million.
That’s an increase of $152 million in 10 years, and that’s massive in anyone’s language, but especially for those who have to pay it. Add to this the increase in the council’s total borrowings, projected to grow from $404.1 million to $806.5 million.
This is nearly a 100 per cent increase in debt.
The chamber’s members are concerned at what they are seeing in these numbers.
Let’s not forget that Wellington’s business community pays 46 per cent of the rates while only making up just 21 per cent of the rateable property.
Our business rates differential is higher than both Auckland and Christchurch.
While the LTP proposes to increase rates by an ‘average’ of 3.1 per cent a year over the 10 years, it also proposes a further 0.8 per cent for an invest-to-grow programme, taking rates rises to an ‘average’ of 3.9 per cent. The council justifies this as a trade-off because it will invest in projects to expand the city’s economy and grow the rating base. We note that the 3.9 per cent is the ‘average’ increase, the actual increase being considerably higher. For next year the total rate take will jump
11.86.6 per cent – around an additional 5 per cent for the owner of a house at the median value, and around 6.7 per cent for a suburban commercial property.
With inflation at 0.1% this is way too big an increase.
I think we should have a law that requires a referendum to approve any rates increase which is greater than say the increase in population and inflation.