Auckland City's Low Rates Increase Congratulated

Media statement Monday, June 9th, 2003

Auckland City congratulated for low rates rise; rates differential disappoints

Auckland's rates increase of 2.5% is one of the lowest seen by the Employers & Manufacturers Association (Northern) this year and business is pleased to see costs being held, especially on top of last year's 1.1% rates rise, the EMA said when presenting its submission to Council this morning.

But operating costs have risen significantly and if it were not for $10 million more income from investments, Council would probably have had to raise rates further.

Every year EMA analyses the Draft Annual Plans of 12 city and regional councils from Rotorua to Whangarei on the same basis.

In particular, the association opposes the practice of requiring business property owners to subsidise residential ratepayers on the misguided basis that business make greater use of Council services and have a greater ability to pay than residential ratepayers.

"Neither point is economically valid and most councils acknowledge this and are phasing them down, said Alasdair Thompson, EMA's chief executive.

"Hence business is disappointed Auckland City is planning to increase its business differential from 196% to 247%," Mr Thompson said.

"We can't find any good reason in the plan for retaining the differential let alone increasing it.

"It's against the trend elsewhere in New Zealand and in conflict with its own policy to reduce it. Business in Auckland already pays about 53% of Auckland's rates.

"We congratulate the Council on the low rates increase, its debt reduction programme, and its ambition to build a substantial convention centre.

"To achieve a better balance between rates charges and the benefits derived from them we also urge councils to make full use of Uniform Annual Charges (UAC's) and Uniform Annual General Charges (UAGC's). Auckland is not using its UAGC to the maximum extent possible and we urge it to do so."

Comments: Alasdair Thompson tel 09 367 0911 (b)

09 303 3951 (h)

0274 982 024

NB: About 1990 businesses and other organisations in Auckland City are members of the Employers & Manufacturers Association (Northern), about 27 per cent of the association's total membership. Together, EMA's Auckland members employ 115,000 staff and have a combined payroll of $4.6 billion a year.

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