Someone's got to sort this mess out
Source 19 June 2025 PDF Local Government Minister Simon Watts is “working at pace” on a rates cap model, revealing to the The Post/Infrastructure NZ Local Government Forum there are concerns about the “degree of rate increases that we’re seeing”. Watts was asked by The Post national affairs editor Andrea Vance if he had given […]
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Local Government New Zealand recently estimated an extra $11 billion is needed over the next seven years to meet unexpected cost increases. The credit rating agency S&P Global has downgraded 18 councils and three council-controlled organisations, and given negative outlooks to three more councils.
The auditor-general reported in February that inflation has driven up the costs of construction, insurance and debt servicing. This is putting pressure on operational expenses and capital improvements at the same time as demand for council services is increasing.
Continue ReadingTo react to this fiscal crunch by cutting public spending – both capital investment and current – is the wrong approach macroeconomically. It risks making the problem worse: depressing growth further, and reducing tax revenues and hence the resources available to improve public services. The economy will not sufficiently grow while people sit for months on NHS waiting lists unable to work; while children from poorer backgrounds are held back from achieving their full potential at school; and while the housing market is so dysfunctional that lack of affordability prevents people taking up economic opportunities.
There are other options available.
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