“At this time of uncertainty, we must balance the requirement for councils to exercise fiscal responsibility with the
need to continue to invest in key infrastructure projects,” says Property Council New Zealand chief executive Leonie
“Ratepayers face an uncertain immediate future, and local government must adapt by minimising rate increases wherever
possible. However, it is also critical to our economy that key infrastructure projects continue to progress in order to
maintain the workforce that will be needed long after COVID-19 has left the headlines.
“The local government Annual Plan process of setting rates for the 2020/21 Financial Year is now underway. With many
proposed rates increases exceeding 5% and some in excess of 10%, the draft Annual Plans need to be adjusted to a level
that is fiscally responsible - ideally at the rate of inflation - leading into a predicted global recession.
“Initially we expect local government will focus on maintaining essential services such as core infrastructure upgrades
to water services and roads during the lockdown. However, we ask that councils be prepared to kick start projects once
the restrictions are eased. This includes identifying and supporting private sector programmes and projects that can be
“If we have learnt anything from past economic recessions, it’s that they do end, and history proves that having a
mobile workforce ready to capitalise on opportunities for rebounded growth is an important part of recovery. We saw this
after the stock market crash of 1987 and after the GFC in 2008 – keeping people in work is key to recovery,” says
“We urge local government to consider this balance carefully as they propose increases to rates across the country. This
is a time to focus on needs not wants so that we are prepared for both recession and recovery in equal measure.”
The Property Council encourages local authorities to think outside the box when it comes to funding mechanisms, with the
opportunity for rates relief or rebate options such as waving late payment fees and allowing delayed rates instalments
to be considered.
“This will provide property owners with the ability to provide rent relief to their tenants, says Freeman. “The property
industry is willing to take the lead in supporting businesses in these tough times however local authorities need to
“In the meantime, councils can leverage central government’s depreciation policy, allowing owners of commercial
properties the ability to once again depreciate those assets. Local government will be in a better position to reassess
rates and spending on non-essential assets at next year’s 2021-2031 Long Term Plan.
“We welcome further discussion and collaboration with the Government and local authorities as we continue to work
together to find a solution that is fair, consistent and supports our communities as the situation unfolds.”