Responding to Hamilton City Council's proposed increase of 25.5% for the 2024/25 financial year, and subsequent 14.1% rate hikes for the following four years, Taxpayers’ Union Head of Campaigns, Callum Purves, said:

“While Hamilton City Council might be trying hard to sell the idea that there is no other choice when it comes to funding its water infrastructure, it’s evident that the financial crisis it now finds itself in has been driven by years of wasteful spending.

“Just last year, our 2023 Ratepayers Report revealed the Council had spent over $315m on contractors and consultants – more than three times that of Auckland Council – and pays nearly a quarter of its staff salaries over $100,000. It’s that there is still plenty of fat the Council could trim to allow investment in vital infrastructure while protecting ratepayers from eye-watering rate hikes.

“Double-digit rate hikes have become a worrying trend across New Zealand’s local councils and now you’d be hard-pressed to find any council with a rate increase below the level of inflation. It’s high time our local authorities start cutting back on the nice-to-haves and stop expecting ratepayers to keep bailing them out."

The Taxpayers’ Union is slamming Selwyn District Council for proposing a 16% rate hike in the first stage of a cumulative 45.89% rates hike over three years.

“Yet again we are seeing a council completely fail to be prudent with its spending proposals, and is now asking its already-burdened ratepayers for an extra arm and a leg to bail them out,” Taxpayers’ Union Campaigns Manager, Connor Molloy, says.

“From a council that just last year was able to keep its rates increase under the level of inflation to now looking at dropping double-digit rate hikes for the next three successive years is an unacceptable turn of events that has blind-sided Selwyn’s ratepayers.

“The council should be tightening their belt like households all across the district are forced to do when costs rise. This includes trimming the fat in the Council’s back office bureaucracy, letting go of gold-plated vanity projects and seriously considering the sale of under-utilised or unnecessary assets.”

Despite the national health and financial emergency, most councils are still planning to hike rates - some up to nine or ten percent. Louis interviews Hutt City Councillor Chris Milne & Christchurch City Councillor Sam MacDonald on their response to our campaign calling for a nationwide rates freeze and ways councils can save money.

You can support our campaign calling for a naitonwide rates freeze at www.ratesfreeze.nz. The dashboard referred to in the podcast is available at www.taxpayers.org.nz/rates_dashboard

You can subscribe to Taxpayer Talk via Apple Podcasts, Spotify, Google Podcasts and all good podcast apps.

Local Government New Zealand, is spending considerable ratepayer money on a campaign promoting local income taxes, regional fuel taxes and regional GST-style regimes to increase the tax burden of local councils. LGNZ today launched a review document on various options for new taxes. You can download the paper here.

This diagram illiterates well the growth of local government (source):

New Zealand’s average rates bill has doubled in the last 20 years, tracking at twice the rate of inflation.

Instead of focusing on the quality of councils' spending decisions, LGNZ appear to be using ratepayer money on studies and propaganda promoting new taxes. We have long been concerned that LGNZ too often represents the interests of councils, rather than those paying the councils' bills! Nowhere in the discussion paper for example, do we see a disciplined analysis of why local government spending is out of control.

We've also been alerted to emails where LGNZ spin doctors are sending  draft opinion pieces to local mayors so that they can 'leverage local media' and promote these new taxes. 

"Trust us we're politicians"

In the LGNZ press release, the lobby group's President, Laurence Yule, says that:

“The goal is not to increase the overall tax burden for New Zealand, but rather to determine whether a different mix of funding options for local government might deliver better outcomes for the country.”

Mr Yule is telling the public that the goal isn’t to increase the overall tax burden while at the same time releasing a report that isn't on ways to save money, but on ways to tax more.

Former North Shore City Councillor, North Shore City Council David Thornton writes:

LGNZ Review is about more money for more spending

Few ratepayers object to the principal that all citizens should contribute to the cost of running their communities, and that those contributions should be within the ratepayers’ ability to pay.

The Local Government New Zealand funding review revisits many of the issues raised in the Independent Rates Review of 2007 and repeats some of the same conclusions reached then.

The difference between the two reports is that the 2007 review was looking for alternatives to rates, while this new report is aimed at raising new funds in addition to rates.

In other words LGNZ, on behalf of all councils, wants to spend more, and needs more money to feed those expansive ambitions.

We agree. The Taxpayers' Union isn't against new taxes per say. Our view is that new taxes should replace old ones (i.e. an equal decrease to compensate). In the case of local government though, LGNZ's efforts are so the local government spending binge can continue...

Poll: Should councils be given new powers to impose local GST, fuel and income taxes?

Vote by clicking here. 

Yesterday the Taxpayers’ Union  announced the winner of its competition for the Aucklander with the highest percentage increase in rates and user-charges.

The winner is Mrs Glenys Smith of Howick, whose rates have more than doubled since 2003.

Mrs Smith is a classic example of an Auckland householder paying more but getting less. In 2003 Mrs Smith’s rates were $1,371 in 2003. They are now more than double, up to nearly $3,100 for 2013/2014.

Mrs Smith also pointed out in her entry that, “When the wastewater charges were taken off the rates, the rates didn’t go down to compensate!”

Mrs Smith wins a KraftMaster petrol lawnmower (perfect for mowing the berms).

The other winner is Mr Colin Shearer of Sunnyhills. Though Mr Shearer didn’t provide the required user charge details to qualify for the lawnmower, his un-capped rates increase was the highest we received. As a discretionary prize, the Taxpayers’ Union is giving Mr Shearer a weed-wacker.

Mr Shearer’s uncapped rates increase is 34.2 per cent, from the 2011/2012 base year. That means that his rates will be over a third higher, in less than four years.

While Len Brown is hiding behind the ‘average’ figure of 2.5 per cent, this is merely an attempt to disguise just how much extra some Auckland households are paying. As the entries show, many Aucklanders are paying much more, while the Council is reducing services such as berm mowing.

The report of the Auditor-General’s inquiry into the EcoCare wastewater project was released on Tuesday. It revealed serious failures in the management of the project, and strongly criticises Audit NZ. Inaccurate record keeping, mismanagement of the project, lack of financial advice and expertise, and reliance on private partnerships saw a huge budget blowout, with costs exceeding over $63m. For example, the effluent disposal bill alone increased from $361,000 to $14m.

How did the Council pay for this budget blowout? By raising rates for Mangawhai residents. The annual cost to ratepayers was a consideration in assessing the affordability of the project. However, the summary of the report reveals that the Council in fact decided to “increase the number of estimated ratepayers that would be covered by the scheme and contribute to funding it”. This is a fundamental flaw, and the Auditor-General concluded that this decision was not based on an adequate account of predicted growth in the area. This, as well as the undisclosed liabilities are precisely the things Audit NZ should have picked up on.

Overall the report suggests Audit NZ was failing audit 101

The Auditor-General's office (which includes Audit NZ) is supposed to provide assurance that government departments are performing as they should. The report details that:

• audit quality of the project was varied;
• the quality of documentation for some audit files were inadequate, especially those explaining why judgments were reached;
• there was a failure to reassess the project between 2006-2009 despite significant changes that could have been an audit risk; and
• the auditor’s reliance on information from Kaipara District Council’s management (which, from our examples above, were also clearly inadequate).

Joel Cayford has written a blog post evaluating the report. He’s gone a step further than the Taxpayers’ Union, and believes that an unreserved apology does not cut it, concluding that the Auditor-General's 'head is on the block'. 

Many audit failures internationally have led to large payouts by audit companies and their insurers to shareholders. Here, the tab was left with Kaipara ratepayers. The report does not address what we think the issue is: redress for the Kaipara ratepayers who paid the bill.

Entries close tomorrow for our competition for the householder who can provide evidence of the highest percentage increase in Auckland Council rates and user-charges.  The prize is a lawnmower - just perfect for mowing those berms.

At the same time the Auckland Council is reducing services, a quick flick through the 50 or so entries we've have in so far, show many rates and user charge increases well over the 10% "cap".

The terms and conditions are available here.

Please scan and email your entries to [email protected] as any sent by post will no longer arrive in time.

We've been looking into the claims by Auckland Council politicians relating to promises of a 'living wage' for Auckland Council employees.

An Auckland Council internal report obtained by the Taxpayers’ Union raises questions about the potential for job losses and casts the $3.75m price-tag for the policy into doubt. 

The Council’s report explains that the living wage is ‘not an effective, general tool for alleviating poverty’ and that ‘large proportions of minimum wage workers do not live in poor households.’

When you put aside the political rhetoric, the economic impact of the living wage policy will be disastrous for low-skilled Council workers, diversity and ratepayers according the Council’s own analysis.

If the Council’s aim is to reduce poverty, the report suggests that living wages for Council employees is not the way to do it.  According to the report, workers aged 15 - 24, women and ethnic minorities are over-represented in the category of people not earning more than $18.40 per hour. Artificially inflating Council wages may see less of these groups gaining future employment with the Council as competition for these positions increase.

In addition to increased competition for Council positions, the report indicates the potential for job losses and shows that workers may see overtime slashed.

The living wage policy will not only burden Aucklanders with higher rates, it also threatens Council workers with the prospect of job losses.  The true cost of the living wage policy may be much higher than the $3.75m quoted in the media.  For example, the Council’s analysis only considers workers within a 10% wage differential.  It has not factored in the potential for a domino effect of wage increases emanating from the introduction of the living wage.

We've uploaded the full report here.

The Taxpayers’ Union this afternoon announced that it is offering a lawn mower to the householder who can provide evidence of the highest Auckland Council percentage increase in rates and user-charges.

We understand that some Auckland residents have suffered cumulative rate increases of over 30 per cent in the last few years.  At the same time the Auckland Council is reducing services such as berm mowing.

We are worried that while Len Brown is hiding behind the ‘average’ figure of 2.5 per cent, this is merely an attempt to disguise just how much extra some Auckland households are paying.  It ignores, for example, increased user charges.

The proposed rate increase is almost double the rate of inflation.  Aucklanders should be expecting more, not less, services from their Council.

Our press release is available here.  

COMPETITION TERMS: 

The New Zealand Taxpayers’ Union Incorporated seeks rates and user-charge invoices for Council services showing the total uncapped percentage increase in rates and user-charges since the 2011/2012 baseline.  The resident who provides the largest percentage increase for the same property, as determined by the Taxpayers’ Union, will win.

Documentation must be sent to the Taxpayers’ Union, PO Box 10518, The Terrace, Wellington.  To be eligible, entries must be received before 5pm Friday 29 November 2013.

Entrants are only eligible to win the prize if they include their contact email and phone number on the documentation entered, are willing to certify the accuracy of the documentation provided and are willing to have their name publicly disclosed.

Please contact the Taxpayers’ Union (via [email protected]) if you require further information.

The winner will receive a CraftMaster Petrol Lawnmower model KM375PM, or similar.

The Taxpayers’ Union decision on entitlement to the prize is final.

UPDATE: Please scan and email your entries to [email protected] as any sent by post will no longer arrive in time.