MEDIA RELEASE

Budget 2008: More rates rises inevitable

For immediate release on 22 May 2008

“The lack of Government attention to local government funding and infrastructure pressures will inevitably lead to more rates raises,” Local Government New Zealand ‘s President Basil Morrison said after today’s Budget announcement.

“This Budget offers little for our member councils. We acknowledge there are some increases in funding for local government and we are pleased to see the Rates Rebate Scheme has been adjusted for inflation; however, these changes are only minor, compared to the challenges faced by our communities.

“The Government instigated the Independent Inquiry into Local Government Rates because of concerns from citizens at the level of recent rate increases.  This Report identified infrastructure as the largest driver of rates rises and advocated significant additional funding to local government to meet communities’ needs and requirements for infrastructure.

“We have seen local government costs rise significantly since 2002. This has been because of increasingly stringent regulations imposed by Government, increases in the construction index and rising community expectations. These factors have added significantly to the rising costs of maintaining and developing a national network of local infrastructure.  The inevitable end result has been the kind of rates rises we have been seeing recently.

“We are very disappointed that there has not been more progress, particularly as the Government comes to the end of its third term. The ongoing issue of local government funding is one that we will be raising with all political parties ahead of this year’s general elections”, said Mr Morrison.

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