Rates rise will be lower, but method criticised as ‘misleading’
Thursday, 13 February 2025
Christchurch residents are facing a lower rates increase, but the way the council will achieve this has been slammed as “misleading” and conveniently timed in an election year.
The council is now proposing a 7.58% rates increase from July 1 in its draft annual plan: a 1.35% reduction from the figure councillors met to discuss on Wednesday.
The reduction was not the result of budget cuts, but by councillors finding a way to delay increases for another year.
Staff advised against the move - put forward by Cr Sam MacDonald - because it meant rates would need to increase by 10.4% in the 2026/27 financial year instead of below 9%. However, many councillors argued their constituents were hurting now.
“At the moment our ratepayers are suffering,” said Cr Kelly Barber. “Next year is another year. Let’s deal with the problem of next year, next year.”
Some 1.04% of the reduction comes from the $8 million of forecast surplus from the current financial year, which most councillors agreed to push into the following year.
However, councillors were divided on using an additional $2.65m to reduce rates instead of paying down debt, as initially proposed. The move passed 9:8, which resulted in a rates reduction of 0.32% in the coming financial year, but had the consequence of a 0.34% increase the year after.
These and other decisions made on Wednesday took the budget from being unbalanced by $48m to $60m.
Cr Melanie Coker criticised her colleagues for making the balance worse.
“That means our income won’t be enough to meet our expenses next year. It does mean we can decrease rates during an election year knowing full well that the following year we’ll need to ask the public to pay that back,” she said.
“In my view that is poor leadership, poor financial management and essentially we’re misleading the public.”
Deputy mayor Pauline Cotter said using the surplus on rates instead of debt reduction made her uncomfortable, as well as having an unbalanced budget, but she supported the draft plan and was hopeful the economy would improve in the next year.
“This is a good year to be easing financial pressure on people,” she said.
Cr James Gough, acknowledging the now-10.4% proposed rates increase in 2026/27, hoped it would put more pressure on council to work harder at finding savings in the next annual plan.
Cr Sam MacDonald did not directly respond to Coker’s criticism but repeated what many councillors said, which was that the Wednesday meeting had ultimately been constructive.
“There isn’t a household in the city at the moment that has a balanced budget,” he said.
Cr Jake McLellan said he shared concerns about people struggling, but said “let’s be honest, we haven’t made any true savings today.”
He said the only vote they made on Wednesday which could result in savings was one which asked the chief executive Mary Richardson “to go away and find some”.
Mayor Phil Mauger did not participate in the debate.
Councillors Coker, Tyla Harrison-Hunt, Andrei Moore and Yani Johanson voted against the draft plan, with each criticising council for delaying problems.
Members of the public will be asked to suggest ways to save money during the public consultation period, from February 26 until March 28.
Councillors will vote on a final plan by June 30.
The draft annual plan has been in the works since August 2024, not long after the council set a 10 year budget.
While the long term plan looks across a decade of council spending, an annual plan is a chance to tweak the budget of one financial year based on changing circumstances, like fluctuations in inflation forecasts.
The council is proposing to spend $1.68 billion in the next financial year, half of which is funded through rates. Almost half of the total spend is earmarked for three waters and transport infrastructure - 28% and 17% respectively.