The Invercargill City Council’s submission to the proposed local government reforms was discussed at a council meeting late last month.
One of the proposals — to introduce rates capping of between 2% and 4% depending on the inflationary and growth environment relevant to each council — was described as problematic and councillors questioned how funding shortfalls for a range of matters would be met.
During the discussion of the proposal to introduce a rates cap, Cr Grant Dermody said the government’s attempt to take a "scalpel" to cut local government costs was more like using a "rusty pocket knife".
He had no confidence in trying to work with the government or responding to "the methodology they’ve imposed".
Chief executive Michael Day said the rates cap was nationally set — not locally or regionally.
It was based on a Reserve Bank target that had never been achieved, which was "problematic", Mr Day said.
Invercargill Mayor Tom Campbell said the rates cap was based on a complicated formula that was not easy to use.
The council’s submission had not said it was either for or against the rates cap, but it needed more information in order to understand how the formula worked, Mr Campbell said.
In the submission, the council noted there was a range of council spending which would not be able to take place under the new system.
For example, the council would be unable to continue to fund the regional development agency, Great South, and funding for community development would be prevented, as would funding for the preservation of heritage buildings.
Cr Alex Crackett said she would like the government to explain how the funding shortfall for organisations such as Great South would be met.
"If we can’t fund these services that we’re providing for our community at the moment, we’ve got a whole lot of establishments that will go backwards."
At present, the government was encouraging regional development, she said.
"If we no longer have a regional economic development agency, how are we expected to still do that?"
