Local government authorities raised income from rates by 8.3%, or NZ$85.1 million, in the September quarter to NZ$1.113 billion from the same quarter a year ago, figures released by Statistics New Zealand show.
In contrast, the consumers price index rose 1.5% in the quarter from a year earlier, according to the Reserve Bank of New Zealand. Non-tradable inflation rose 2.5% over the same period.
These figures come after the new Auckland Super City Council voted to start its latest six-month rate setting process at 4.9% in the 2011/12, according to Radio NZ.
The 8.3% rise in rates income came as total local authority operating income rose 5.5% in the September 2010 quarter from the September 2009 quarter to NZ$1.684 billion.
Seasonally adjusted figures show total operating income fell 2% to NZ$1.721 billion in the September quarter from the June quarter. Investment income fell 61% over the quarter, although Stats NZ warned this included dividends, which were not seasonally adjusted and could be both variable and irregular, resulting in volatile percentage changes.
Seasonally adjusted total operating expenditure of NZ$1.791 billion during the quarter meant local authorities posted a seasonally adjusted operating deficit of NZ$69.8 million in the September quarter from a NZ$19.7 million deficit in the June quarter.
Seasonally adjusted operating expenditure was up 3.7% from a year ago
Unadjusted figures show a deficit of NZ$71.4 million in the September quarter, down from NZ$102.6 million the same quarter a year ago.
Hide disappointed "as a ratepayer"
Meanwhile this afternoon in Parliament, Minister for Local Government Rodney Hide said as an Auckland ratepayer he was disappointed by the council's vote to look to increase rates by 4.9% in the 2011/12 year.
"It’s up to the council not the Minister of Local Government to set the rates," Hide said in response to a comparison of the rates vote to a 3.9% increase flagged in an earlier Auckland planning document he wrote.
The Auditor-General yesterday released her own report on Hide's Auckland planning document, saying:
The planning document shows the indicative trends for rates and borrowings, subject to decisions of the Auckland Council. Rates are forecast to increase by 3.9% in 2011/12, the first year for which Auckland Council will set the rates. This compares with an overall average increase of 6% that the former councils were forecasting for that year in the long-term plans.
In my audit opinion, I highlighted the significant assumption disclosed in the planning document about efficiency savings of $47.7 million annually from 2011/12. The 3.9% rates increase assumes their realisation, although the sources and timing of these savings were yet to be identified in detail at the time of finalising the planning document.
In response to figures today showing local authority rates income up 8.3% from a year ago, and whether this meant his reforms had not worked, Hide said, "We’ve only just passed the legislation, they’ll kick in next time".
Key says it's better than earlier estimates
Prime Minister John Key said the planned 4.9% increase was better than some of the earlier estimates he had been given, "but we are always conscious of rate hikes because New Zealanders are struggling at the moment and that’s the message we’ve given to Auckland Council, as we have to others".
It was now up to the council to set the rates, Key said.
Goff sure Len Brown doing what he can
Meanwhile Labour leader Phil Goff said it was clear what had been promised with the Super City amalgamation hadn't come to pass.
"What’s really disturbing about Auckland is that the latest survey by the Auckland Chamber of Commerce shows the lowest level of business confidence in more than a decade. This country’s economy has stalled and that’s hurting Auckland," Goff said.
Len Brown voted for the 4.9% increase...he’s in the Labour party
"He has picked up a situation of huge debts and huge expenditure commitments. He’s kept that down I’m sure as much as possible. It’s still very high given the pressures on families," Goff said.
"Everybody would rather have seen that been much less. But the transitional costs imposed by the National government and Rodney Hide have been very high on Auckland," he said.
(Updates adds Hide, Key and Goff comments, link to Radio NZ on Auckland rates, income, expenditure, deficit figures)