Track Dunedin City Council rate increases over the past 15
years and a pattern emerges.
As expected, most increases outstrip inflation levels.
Councils have complained about being saddled with more
responsibilities, major infrastructure upgrades have been
required and it is the nature of local government to spend
more and more. Empires built on other people's money will
expand without assiduous and active watchdogs.
But less obvious is the effect of elections.
Every three years the mayor and the councillors go before the
electorate and each election year they seem to try that much
harder to subdue spending increases.
In the in-between years, they appear to be influenced more by
the special interest groups and managers who press, through
the annual plan and through public submissions, for their
"worthy" causes and their "essential" spending.
The system itself these days means that councillors and
mayors without sufficient fortitude will concede to the
pressures.
Since 1997, the city rates increases (with election years in
italics) have been 4.9%, 2.5%, 5.7%, 5.1%, 2.9%, 1.9%, 2.9%,
2.8%, 8.5%, 5.5%, 6.4%, 10.4%, 7%, with a proposed rise this
year of 5.2% and for next year of 8.9%.
The local body elections are in October so it should not
surprise that the current proposed increase has been trimmed,
while the post-election prospects for ratepayer purses are
bleak.
While councillors might claim to have had little room to
manoeuvre today, it will be especially tough for the next
council in 2011.
Over these 15 years, the average rates increase after an
election is 7.08%, in election year the average is 3.96%, and
the figure for the middle year is 5.08%. The one exception to
the post-election spike was in the 2002-03 year, when the
rates rose by their smallest amount over this period, 1.9%.
One way to cushion and postpone rates increases is through
borrowing, and this helped ameliorate the increase for
several years. But interest on such debts must be paid and
pay-day is arriving fast.
In order to improve the look of the figures, councillors are
also trimming depreciation allowances, but the inflow of
depreciation money will be essential for paying for services
in the future, such as the huge amount needed for water-pipe
replacement.
And the scale of rate increases would have been even worse if
it was not for the hefty hikes in the amounts extracted in
the form of "dividends" from the council-owned companies.
Finance from the Waipori fund from the sale of the Waipori
power stations and additional "user pays" income has also
helped curb increases.
Councillors clearly are looking towards the elections already
and they must be aware of the unprecedented level of disquiet
about the rates rises and spiralling debt they have overseen.
Most, including those who are now trying to distance
themselves from the extra commitments and singular spending
programme of recent years, must take their share of the
responsibility.
Few have displayed the vigour required to curb a burgeoning
bureaucracy, or the courage to say "no" while bearing in mind
the city's demographic.
They should all remember, nevertheless, that the public does
not desire to be represented by men and women who are
bitterly negative.
The results of the last elections indicated that.
Many voters recognise that Dunedin cannot stagnate and that a
judicious and strictly limited choice of big projects was,
and is, reasonable and even necessary for the city's growth
and vibrancy - and that will mean rate rises ahead of
inflation.
At the same time, voters expect a frugal council to
efficiently keep to its core functions, with minimal spending
in discretionary areas.
It is here that councillors, once again, have failed to be
prepared to say "no".
In the months leading to the poll later this year, voters who
are worried about the state of the city's finances - as they
should be - should focus on the election of a leadership that
recognises these facts while also being positive about what
the city has to offer.
It is possible for a council to be dynamic and uplifting
without relying on the crutch of big spending, and it is
possible to oppose "thinking big" without destructive
cynicism.
Dunedin is a small city perfectly placed to make the fullest
advantage of its extraordinary location and amenities (and
the new stadium will, for better and worse, be part of that).
But Dunedin cannot supply all the facilities and services of
a bigger centre, and its mayor and councillors - as well the
voters - will have to recognise that hard fact.
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