For those struggling, the rates rise is a big hit

Monday, 13 February 2023

How are council rates calculated?

Dave Armstrong is a playwright and satirist based in Wellington.

OPINION: Last week you could see many Wellingtonians out walking and cycling, enjoying the beautiful weather. However, every now and again, you would see them surreptitiously look up to the heavens – checking that everything was alright. But it wasn’t, and during the week something much heavier than expected came crashing down onto their heads. I’m talking, of course, about this year’s rates rise, which is predicted to be 12.8%.

Earlier in the week, mayor Tory Whanau correctly explained that there have been decades of under-investment in Wellington’s key infrastructure areas such as water and housing. Last December, the mayor asked for an in-depth review of all council spending, which could not immediately identify a single item that could be cut. Those damn turkeys never vote for Christmas.

What a tribute to former mayor Andy Foster and his supposedly dysfunctional council that not one cent of their plan was deemed cuttable by council! That’s what I call a zero-waste strategy.

Later in the week, however, we learned that a ‘business as usual’ annual plan would have meant a 17% increase, so the good news is that it could have been even worse than the proposed 12.8%.

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Wellington mayor Tory Whanau has confirmed her council is looking at a 12.8% rates rise.

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Councillor Nicola Young has suggested council look at the economic development agency WellingtonNZ for possible savings.

Nevertheless, for those struggling to make ends meet, and for those with the rateable value of their property well above the market value, the rates rise is a big hit. Yet we only need to see a 15kg streetlight lying on the ground to know of the parlous state of much of our infrastructure.

Councillors unanimously agree that spending more on water infrastructure is essential. But are there other areas where savings could be made? It’s all very well to talk about ‘wasteful spending’, but we need to know details. The only councillors to have publicly suggested spending cuts are Ray Chung and Nicola Young. One of their targets is cycleways.

Dave Armstrong: “My biggest worry is that if cuts are made, they will be on physical infrastructure and not areas – especially management and communications – which could do with a look.”

At present, $14 million is budgeted for cycleways this year and next year $30 million. And the council expects central government to fund more than half of this. It’s a drop in the ocean. Despite the commotion that accompanied new lanes in Newtown, they make cycling safer and popular. Do we really want to limit what has now become the fastest way around the inner city even for slow old guys like me?

Chung makes the point that over 90% of Wellington cycle accidents happen at intersections. So why have cycleways? Because it’s the lack of protected lanes that stops potential cyclists getting on their bike in the first place, thereby increasing car congestion.

Nicola Young also suggested looking at WellingtonNZ for possible savings. For those of us who remember the days of WellingtonNZ (formerly WREDA) splurging on $150 bottles of wine to entertain local MPs, this is a good call. There is some great work done by parts of WellingtonNZ – I’m thinking tourism and film liaison – but there is also money spent that is neither contestable nor transparent. We don’t know where the money goes, and because of so-called ‘commercial sensitivity’ we must take WellingtonNZ’s word that it’s well spent.

Some councillors have been calling for a good look into WellingtonNZ for years – given the council funds about 80% of it – but it needs to be led by a mayor with both the courage and the ability to effect real change. So far that hasn’t happened.

I also think some other of our other council-controlled organisations(CCOs) could save money. Despite the high cost of venues being the number one bugbear of many local artists, Venues Wellington seems top-heavy with well-paid staff. Trying to hire a council venue for less than market rates if you’re a small Wellington cultural organisation seems as difficult as ever. Some arts practitioners even talk about having to apply for a council grant to offset the high cost of using a council venue. Why not just give them a discount?

When the Tākina convention centre opens, will it be so expensive to hire that only overseas corporates can book it, or will local organisations get a healthy discount? I fondly recall when schools could hold prizegivings at Wellington Town Hall, and it didn’t break the bank.

My biggest worry is that if cuts are made, they will be on physical infrastructure and not areas – especially management and communications – which could do with a look. But I can’t do my usual moan about the high number of council communications staff as they are not a single entity but spread throughout the organisation.

The comms staff who run the council Twitter account do a great job in replying to many complaints, but in other areas I’m not so sure. Just last week we were informed that there was only a ‘very small bad batch’ of streetlights likely to fall onto the ground. We later learned from a transport and infrastructure manager that the number was about 1000.

Using that sort of comms spin logic, a 12.8% rates increase is a ‘very small’ number indeed.