Aucklanders face 5 percent rates hike next year as Goff releases Recovery Budget proposal

Aucklanders are facing a one-off 5 percent rates increase to maintain infrastructure investment, says Mayor Phil Goff.
Aucklanders are facing a one-off 5 percent rates increase to maintain infrastructure investment, says Mayor Phil Goff. Photo credit: RNZ

Aucklanders are looking at a one-off rates hike of 5 percent next year as the council announces a multi-billion-dollar investment to accelerate the city's COVID-19 recovery.

Billions of dollars will be invested in environmental and water infrastructure, transport, parks and community facilities under Auckland Mayor Phil Goff's proposed 10-year Recovery Budget, released on Tuesday.

Goff said if adopted, the proposal would mark the single largest infrastructure package in Auckland's history - injecting an extra $5.6 million into transport, housing and the environment to take the total investment to $31.8 billion.

The investment would accelerate the Super City's recovery from COVID-19 by creating jobs and stimulating the economy, the mayor added.

"This will help Auckland and New Zealand pull out of the COVID-19 crisis while addressing transport and traffic congestion, sustaining and enhancing the environment, improving water quality and the resilience of our water supply, building more infrastructure for housing and tackling the threats posed by climate change."

The proposal also confirmed a one-off 5 percent hike in the average general rates for next year to help fund the proposed budget.

The long-term annual average general rates increase will remain at 3.5 percent.

"Without this increase, we would not be able to bring forward hundreds of millions of dollars of capital investment that was delayed by revenue reduction caused by COVID," Goff said.

"This amounts to an extra 73 cents a week next year for the average-value property compared to the planned 3.5 percent rise."

Goff acknowledged that although some might be unhappy with the increase, he believes the council has found "the right middle ground" which does not overburden the ratepayers, but ensures progress can be made. 

He noted that 46 percent of more than 4000 participants in the council's Colmar Brunton survey supported the budget measures, while 37 percent opposed the rates increase.

"It is unusual for people to support increased rates, but I think they were aware of the impact of COVID-19 on our finances and the fact that other growth cities in New Zealand were putting up much greater increases, some in double figures," Goff said.

The council's proposal package would add a further $152 million over a 10-year period to reduce greenhouse gas emissions and to adapt to the impact of climate change, Goff said, with independent polling and council consultation demonstrating strong public support for the increased investment.

The council is also proposing to increase capital investment by 21 percent over the previous budget, with an additional $4 million allocated for water, wastewater and stormwater, and a $900 million boost for parks and community facilities.

"Funding for capital projects is increased by $900 million in the first three years to maintain our pipeline of planned work and bring forward important infrastructure projects that will stimulate recovery from the economic downturn," Goff said.

Some of the additional money would be allocated to Auckland Transport in an effort to encourage residents to shift to public transport and reduce emissions. Further investment in research, recycling centres and turning Queen St into a zero emissions zone has also been outlined.

It follows on from Auckland Council's emergency budget in July 2020, during which the  council voted in favour of raising rates by 3.5 percent in an attempt to plug the gaping financial hole caused by the pandemic and restrictive lockdown.

At this time, submissions from residents had overwhelmingly called for just a 2.5 percent increase, with nearly one in 10 even asking for a rates cut. Less than a third backed a 3.5 percent increase. 

Read Goff's full proposal on the Auckland Council website here.