Rising fuel costs are expected to hit Ashburton ratepayers, pushing the signalled rates rise out from 8.71% to 9.57%.
The changes were revealed at the activity briefing meeting on Wednesday.
Ashburton Mayor Liz McMillan later clarified that at Annual Plan workshops on April 29 and May 6, the council considered how the rising cost of fuel and electricity could impact the budget and “where these would be most acutely felt”.
“To minimise the impact, councillors reduced the draft budgets for a range of operating and personnel costs.
“However, even after those savings, higher fuel and electricity costs are still looking to have impacted the draft budget by 0.83% with a draft average increase, including water now sitting at 9.57%.”
The finance report to the activity briefing noted “further savings have been confirmed through council workshops in response to cost pressures associated with the Iran war”.
A revised Annual Plan is being prepared to be presented to council for sign-off on June 30.
Councillor Deb Gilkison asked if the result of the “savings” would be a reduction in service.
Financial performance manager Gordon Cruickshank said the council has worked to make savings in other areas to try to reduce the overall cost increases.
“Unfortunately, it has meant the rates increase is slightly increased.”
Gilkison followed up, wondering “why does it take a war for the council to analyse their costs in this way?”
Cruickshank said cost pressures had been a focus throughout the budget process.
“We just wanted to make sure if we were increasing costs due to the cost associated with the Iran War, we could look at the community and say we have reviewed everything again.”
The council’s budget process began in January at an initial starting point of 10.4%.
The councillors settled on a draft with an 8.71% rates increase in mid-March, opting not to consult on the plans.
That increase was split between 3.75% for three waters services and 4.96% for everything else.
That forced the council to reconsider its annual plan to factor in the impact of fuel cost increases.
Those conversations have taken place, out of public view, and resulted in the increase now being 9.57%.
The only change that has been released is the reduced costs of the new road for the second bridge project.
The council had budgeted a $20m loan, but that figure has been reduced to 16m in 2026/27, with the total cost estimated to
Council is budgeting for the cost of the connecting road to be $19.7m and has $16m tagged for the project in its Annual Plan 2026-27.
The lower loan amount will reduce the amount of debt the council needs to cover.
“Reducing the bridge's connecting road loan budget by $4m results in a $76,000 cash saving in the annual plan 2026/27.
“This saving will be distributed to the roading budget,” McMillan said.
Rising fuel prices are also hitting Waimakariri District Council as it finalises its annual plan, while Christchurch City Council has made savings as its fuel bill rises.
