First look at Wellington's next rates rise: 9.4% but prone to change
Tuesday, 16 December 2025
The Wellington City Council has given an early look at what next year’s rates increase will be – notwithstanding the wrangling set to change the figure in the months ahead.
Council chief financial officer Andrea Reeves told a council workshop on Tuesday the council’s existing long-term plan would have seen a 12.7% increase halfway through 2026 but new cost pressures that had arrived since the long-term plan was done would have made it closer to 18.8%. Through various savings, that figure was now 9.4%.
But that was just a “starting point” with work still to come.
In reality, Wellington households will next year get a rates decrease of about 29% as a new water entity, Tiaki Wai, is taking over the running of pipes and will directly bill households for water from June.
But, for the purpose of Tuesday’s information session, that component was included in the figures as a measure of affordability for residents.
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The Government recently revealed plans for council rates capping that would eventually make councils only raise rates by between 2% and 4%.
Wellington City last year signed off an 18.5% average rates increase following three years of average increases of 12.8%, 8.8% then 12.3%.
The large increases were partly caused by a glut of big costs to the council including a cost blow out on the Town Hall strengthening and a major project to fix the central library.
But the biggest shock to rates was the realisation that pipes had been underfunded for decades and were now at breaking point — to the extent that Wellington taps almost ran dry two summers ago.
The council strategy to reduce the 2026 increase from as much as 18.8% was through “savings and mitigations” and underfunding depreciation ‒ the mechanism which the council uses to factor in the eventual cost of replacing ageing assets.
The most high-profile recent cost savings was the council putting a pause on the Golden Mile rejuvenation for a review of costs and assumptions.
The recent mayoral race saw all the main mayoral candidates, including elected mayor Andrew Little, pledging to keep a tight rein on council spending.