21.4% interest rate increase proposed; reflection of ‘sustainability of financing’

Gore District Council is proposing a rate hike of more than 20% as it is weighed down by rising costs and interest rates.

Councilors discussed the draft annual plan report, written by interim chief executive Stephen Parry, during a full council meeting yesterday.

In the report, Mr Parry outlined eight areas where costs had risen, including insurance, council building maintenance, depreciation and road maintenance.

Initially, after all council budgets were submitted to chief executive Lornae Straith, the rate increase would have been 40%, but Ms Straith “worked diligently to reduce the rate increase to 31.7%”, Mr Parry said.

Further cost savings resulted in the current proposed increase of 21.4%.

In his report, Mr Parry said this budget was the “most challenging” he had faced in his time at the council.

“These proposed rate increases are anomalous and a reflection of, I believe, a deeper problem: the sustainability of local government funding.”

The public would be able to submit comments on the draft annual plan, Mr Parry said.

Gore District Mayor Ben Bell said the council had fallen on hard times since the election.

“I think the hardest thing is to implement a rate increase that we all know, as taxpayers, that the community simply cannot afford, and that’s very difficult because we have to keep this council going.”

During the discussion, Cr. Stewart MacDonell said that while the rate hike this year might be necessary, the council needed to look at other ways to reduce its debt.

“We might get away without too much blood on the carpet with a 21.4% rate hike this year, but if we go back for a second round we’ll be in trouble.”

One possible source of revenue was the sale of some of the 95 buildings the council owned in the city, he said.

Registrations open on Monday and close on May 17.

[email protected]