Five Wellington City Council myths and misconceptions
Wednesday, 1 January 2025
Charge the central government rates
Charging central government rates is often held up as the magic bullet to Wellington’s rates crisis but, while this would put more money in council coffers, it is not the fix for the capital some make out.
Data supplied by the Wellington City Council under the Local Government Official Information and Meetings Act shows the city has 655 rates-exempt publicly owned properties but 438 are actually council-owned properties and the council does not, for obvious reasons, charge itself.
Almost three-quarters of the remaining properties are owned by the Ministry of Education and appear to be all schools – an exemption that applies to all schools regardless of where they are.
By the time other across-New Zealand exemptions are taken out for the likes of hospitals, NZ Transport Agency Waka Kotahi, KiwiRail, Department of Conservation, and regional council land there are just 22 remaining rates-exempt parcels and some of those are multiple titles for the same property.
Council acting chief executive Andrea Reeves said most government departments leased rather than owned buildings and those buildings did not get the exemption.
In some respects Wellington got off lightly as places such as the South Island West Coast had swathes of Department of Conservation land which was not rated, Reeves said.
The remaining properties include two Oranga Tamariki suburban properties, two Kāinga Ora suburban properties, what appears to be a Kingston preschool, an empty Crown lot in Johnsonville and a precipitous section on the road up Wrights Hill in Karori.
The only notable central city rates-free parcels are Parliament and a Bowen St building, the Victoria University law school, the Pukeahu National War Memorial, and the Heritage New Zealand Pouhere Taonga base on Boulcott St. While Parliament does not pay rates it does pay a levy for a new sewage sludge treatment plant. The $71.4 million property will pay a $8203 sludge levy this year.
It all means that charging the government rates will mean more money for all councils, but Wellington is not hugely disadvantaged by being the base of government … and also benefits by having well-paid public servant jobs.
As councillor Tim Brown points out, there are other ways the Government could help councils, such as sharing GST.
A record investment in pipes
After a nightmare summer of 2023-2024 where leaks and a dry season saw taps almost run dry, the council has been crowing about its “record” investment in pipes as it foisted a fourth eye-watering rates increase on residents.
While it is true that the planned spend on pipes in the now-started decade is huge, it is important to note that most of this spending is planned in later years. This means future councils will have to vote on what is actually spent on the pipes.
Water utility Wellington Water has said the length of Wellington City pipes it has funding to replace this financial year is just 520 metres. Wellington Water has recommended replacing 40km of pipes every year for 30 years.
Overpaid and under-worked
It is often muttered than our elected local government officials are overpaid and under-worked.
In fact, the Wellington mayor earns $189,799 a year, the deputy mayor earns $131,366, those chairing committees earn $120,666, and councillors with no extra responsibilities earn $109,178.
It is fair to say you won’t see them in the lines at the food bank but the pay is not that high given the relentless pressure, public criticism, and lack of job security (they effectively have to re-apply every three years).
To put it in perspective with other public servants, outgoing council chief executive Barbara McKerrow had an annual salary above $500,000, Prime Minister Christopher Luxon earns $484,200 and Labour leader Chris Hipkins earns $298,000.
This week Seek.co.nz has a job advertisement for a manager at disabled people’s organisation People First NZ Ngā Tāngata Tuatahi paying up to $167,000 (more than the deputy mayor but just less than the mayor). A strategy implementation director at Worksafe is being advertised with pay up to $360,148.
In terms of workload, it is true that at least one councillor has a second job but, for most, this is their only job and – if done properly – the workload is sizeable. Agendas and reports can reach hundreds of pages and there can be numerous in a single week.
But it is also true that the last council meeting of the year was December 17 and they won’t meet again until February 12, making for a longer summer break than school students. (Most though do reply to media queries over the break).
Rates going up with property value
Every few years the council re-evaluates property values and, like clockwork, each time people see their new value and think their rates are going to soar.
Yes, they are going to soar but not because your property value is increasing. They go up because of higher council spending.
If all property values increase by an average of, say 20%, the total amount of rates the council takes across the city stays the same (or rises with spending), meaning the only way your rates will increase due to property values is if they go up more than the average.
Equally, when the new rates valuations soon come out, many will see their values drop but don’t pop the champagne. For the same reasons, rates will go up this year and every year for the next nine.
Where’s the bus?
Bus running late? You are right to blame the council …. just get the right council.
It is the Greater Wellington Regional Council that runs the buses and fixed a broken bus system.
The Wellington City Council has some indirect input to buses. For example, council road works or road changes that slow traffic will also slow buses.
Historically, the city council has provided the bus shelters though the regional council is now doing some. The city council can put bus stops, and lanes, where it wants but it is the regional council that decides if it will use them.
What this means in effect is the two councils work together on them.