Forecasted Rates Increase Revised Down

In response to the severe global economic crisis, Auckland City Council is looking at a number of ways to further reduce the forecasted rate increase in advance of its budget meeting in early March.

Deputy Mayor, David Hay says a range of cost saving measures mean that the proposed rates increase for the next financial year can be held at 2 per cent, which is even lower than the council’s forecasted rate of inflation which has been revised since December to 2.5 per cent.

“We made a commitment to ratepayers to keep any rates increases to the level of council’s inflation or below and we are on track to deliver that again,” said Mr Hay.

“We are very aware of the strain on household budgets and people's ability to pay their rates bills so we have worked hard to find savings in the budget.

“By making rates more affordable for people, we are taking a lead in these difficult times to help the economy adjust and maximise the city’s, and the country’s ability to navigate the economic downturn.

At a budget direction setting meeting at the end of last year, the council’s rate of inflation, and therefore the proposed rates increase, was forecasted at 5 per cent.

The rapid economic deterioration has had a significant impact on the council’s operations and because of this the council has revised its forecasted rate of inflation to 2.5 per cent.

“As a result of the economic situation some of our costs have gone down and we are passing these savings on to ratepayers.

“In addition we have agreed with the chief executive that there be no additional budget put aside for staff salary increases in the next financial year.”

Auckland city’s Mayor, John Banks says, “We will also continue to aggressively look for savings in other operating costs like contractor and supplier expenses

“Despite the reduced rates increase, we will maintain the largest ever capital investment in the city next year.”

The combined committees of council will meet on 4 March to discuss the proposed budget and policies for the draft 10-year plan. This will include formal consideration of the revised council’s rate of inflation. The plan will be available in April 2009 for a month long public consultation, before the council adopts the final 10-year plan in June.

ENDS

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