New Zealand Parliamentary Debate

Local Government (Rating Cap) Amendment Bill [4474]

proposals in these plans, they have had far more opportunity to make their views known than ever before.

Mr Hide's old, recycled bill will ride roughshod over this process by imposing an externally mandated cap. That will mean that if a local community wants its council to do something, and it requires the raising of rates beyond inflation plus 2 percent, the council will be able to do so if-and only if-the Minister of Local Government agrees. In short, any future Minister who does not believe in local people setting the priorities and magnitude of their council's work and rating system, or who sees a potential political gain, will be given the power to overrule the local process created under the 2002 legislation. Our communities deserve better than to be a political football.

I draw the attention of the House to the report of the Joint Central Government/ Local Authority Funding Project Team published late in August. It concluded that there is a degree of catch-up needed in infrastructure, roads, water supply, sewerage, and stormwater disposal schemes-not frills, but the infrastructure a growing economy needs. No one wants to see our roading network clog up, to have people drink substandard water, or to see poorly treated sewage tipped into our waterways. One of the root causes of this infrastructural deficit is the very kind of Luddite thinking that drives this bill, that rates must not increase faster than the rate of inflation. For this reason, essential maintenance was deferred, projects were put off, and renewal work went undone because depreciation was not funded-or not sufficiently funded-let alone adequate provision made for what was often highly desirable or even essential qualitative service facility developments.

This bill overlooks the fact that New Zealanders as a society expect higher environmental standards than they did 10 years ago. Upgrades and clean-ups are in progress all around the country. This ill-considered, regressive bill would choke this activity. Our scenic lakes would remain choked with agricultural nutrients, waterways would be polluted with motorway run-off, and sewerage and stormwater systems in some provincial centres would mingle in a heavy storm. Infrastructural catch-up in meeting society's aspirations of improved environmental standards and community services all comes at a cost that is often greater than the inflation plus 2 percent that this bill would allow.

For many communities, the choice is not between more or less, it is between more now and even more later. Like us, the local councillors' ultimate accountability rests with the voters at the ballot box. A local council that puts rates up without demonstrating value for money and without winning the support of its constituents is likely to find itself involuntarily retired.

So the Government will not be supporting the bill. Of course, the Government is concerned about the impact that rising rates have on those ratepayers on low or fixed incomes. That is why the 2005 Budget signalled the Government's intention to make significant changes to the qualifying thresholds and level of assistance available under the rates rebate scheme. Those changes took effect on 1 July and up to 300, 000 lower income New Zealanders are now likely to be eligible for a rates rebate of up to 500. Those members genuinely concerned for those on low or fixed incomes would do well to remember that this initiative alone is a far better avenue for addressing these concerns than this ideological, ill-thought-out bill. So we do not support the bill; it should not go past the first reading.

JOHN CARTER( National-Northland):

Ratepayers across this country are hurting, newly-weds in their first homes are hurting, businesses across this country are hurting, and elderly people-particularly those on fixed incomes-are hurting. The reason why they are hurting is that they are being loaded with rates charges that they cannot meet. Across this nation, there is a growing wave of ratepayer revolt that will