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.

Councils often overlook the fact that most ratepayers accept their individual responsibility to contribute towards the cost of providing essential services – but it is the way in which that cost is spread which raises the anger of many ratepayers.

The incidence of rates changes every three years with revaluation, as Auckland ratepayers are currently finding out, and there is both anger and frustration at the apparent inequity of the current rating system.

The second cause of anger is the expenditure pattern of councils, especially when new projects are proposed which councils proclaim as having the full support of ratepayers, without any proof of such support.

One classic and topical example of that is the proposal to start building the Central Rail Link in Auckland without full funding in place, and without a supporting business case.

The LGNZ report claims that the need for more funding options stems from ratepayers and others ‘demanding’ new and improved services and projects – but public opinion suggests that local government gets involved in too much non-essential activity at times when financial restraint is called for.

The report also fails to acknowledge that some councils actually reduce maintenance on core infrastructure in order to fund new ‘desirable’ projects and services “in response to community demands”.

No review of funding can be carried to a logical and acceptable conclusion without a review of all council spending.

ENDS

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