Whakatāne District Council has indicated large rates increases may be difficult to avoid due to the impacts of significant operating and infrastructure costs, coupled with the limitations to how councils are funded.
Council Elected Members discussed the importance of being up front with communities about the likely increases the Whakatāne District is facing through the Long Term Plan budgeting process.
Mayor Dr Victor Luca says initial budget scenarios which address the funding gap left by record-high cost escalations, high interest rates and rising compliance and insurance costs, along with the programme of work required to keep the district thriving, came out at 34.7 percent average rates increase.
“We know this figure is staggering, so we’ve revised these initial scenarios to consider phasing options that could spread the impact over time and we’re thinking hard about what we need to deliver. This has brought us down to a 27.8 percent average rates increase and I emphasise we still have some way to go before we can deliver our draft budget and options for consultation in March 2024.”
Mayor Luca says early budget iterations for Council’s work programme for the next 10 years have been hard to stomach.
“A lot of our focus has been on understanding where the funding pressures are coming from, what the district really needs going forward, and when it needs it.
“Councils throughout New Zealand are in the same boat and while that doesn’t make it any easier for us, it highlights how challenging the financial climate is and the issues we’re facing as a result.
“People often tell us to ‘stick to our knitting’ and ‘just focus on the basics’. “I’ve said that myself while at the same time being mindful that Council provides more than 40 different services and facilities, and without them we would see impacts on the vibrancy and wellbeing of our communities.”
“What’s a ‘nice-to-have’ for one is often a ‘must-have’ for another,” says Mayor Luca.
“It’s possible we may need to pause on some projects, or postpone others, while we work hard to close the funding gap.”
“We’re looking at all options available for mitigating or reducing the cost impacts for our ratepayers, which is a very challenging task, and it’s important to note this may result in some reduction to the levels of service we currently provide.”
“We’ve also requested information on what options and services are available for ratepayers who will find these increases untenable.”
Council Elected Members agreed this was a hard message to share with communities in the lead up to the holidays, however it’s the responsible thing to do and it’s important to be transparent about the process and associated challenges in the coming months.
Council will continue to work on the draft proposed Long Term Plan 2024-34 and will seek feedback on this through a formal consultation process beginning in March 2024. Several opportunities will be available for people to have their say, and for Council elected members to consider as they work to finalise the plan by 30 June 2024.