Ruapehu Mayor Weston Kirton has welcomed the Government’s decision to require councils to keep annual rates increases within a target range of 2 to 4 percent.
"Rates are already too high for many people, and with water costs under the new water entity with Whanganui forecast to increase significantly in coming years they need to come down,” he said.
Councils will be required to consider the target range when preparing their new Long-Term Plans from 1 July 2027, with the rates cap taking full effect from 1 July 2029.
“Now that the Government has confirmed both the target range and the timeframe; councils know what they must work within and when they need to achieve it.
Although some in local government have highlighted the potential negative consequences of rates capping, we cannot simply keep raising rates on communities that are already struggling."
Mayor Kirton said that while councils had been given the 2027/28 and 2028/29 financial years to transition to the new target range, he wanted Ruapehu District Council to achieve it sooner.
“I accept that reducing expenditure while managing ongoing cost pressures will not be easy, but I am confident we can work with the community to achieve the target range ahead of the 1 July 2029 deadline.”
Mayor Kirton said Council had already begun examining what services it could afford to provide in a rates-capped environment.
“With costs continuing to rise and Council set to lose its water services income, we simply will not be able to maintain every service at its current level under a 4 percent rates cap.
In preparation for our new 2027–2037 Long-Term Plan, we surveyed our communities to understand which services they value most, where they believe savings could be made and what trade-offs they may be prepared to consider.”
Council is now costing a range of service-level options informed by that feedback.
Later this year, these options will be presented to the community to help confirm the service levels to be included in the 2027–2037 Long-Term Plan.
Mayor Kirton said the Government had indicated that councils facing funding shortfalls should consider greater use of user-pays charges.
“People may need to consider whether they would prefer increases in some fees and charges, or targeted rates for particular services, as a trade-off for keeping general rates lower or maintaining a valued service.
We need to strike the right balance between keeping rates affordable and continuing to provide the services our communities genuinely value,” he said.
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