Rates increases for individual councils (28/3/2012)
This page is a historic record.
It contains links to old and/or superseded documents for reference purposes only.
When first published, the booklet Better Local Government contained a table (at pages 14 and 15) showing the average rates increase 2002-10 for each council. This data became missorted in the production of the tables resulting in incorrect data being shown for many councils. This error has now been corrected.
Is the reported figure of an average 7 per cent increase in rates nationally correct?
Yes. In 2001/02 total rates income for all councils was reported by Statistics NZ as $2.300 billion. In 2009/10 reported rates income by Statistics NZ was $4.154 billion. This requires an average annual increase of 7.7 per cent in council rates income, and all figures have been rounded down so that there can be no suggestion of overstating the level of increase.
How has the data now been calculated?
All data has been taken from Statistics New Zealand Local Authority Financial Statistics: Year ended June 2010. This data can be accessed at:
The Department has taken the reported rate income for each council for the 2001/02 financial year (the last financial year for which rates were set before the Local Government Act 2002 took effect) and the reported rates income for each council for the 2009/10 financial year (the last financial year for which Statistics NZ has reported data).
It has calculated the average increase as the percentage increase in rates income that would be needed each year to increase the rates income from the reported figure for 2001/02 to the reported figure for 2009/10. It has rounded this figure down to the nearest whole number, for example a council with an average annual increase of 6.7 per cent each year has been rounded down to 6 per cent.
How has the Department dealt with boundary changes for local authorities?
During this period the Banks Peninsula District Council merged with the Christchurch City Council and the Auckland Council was created from eight previous local authorities.
The Department has combined the reported data for the Banks Peninsula District Council with the reported data of the Christchurch City Council in doing its calculations, for Christchurch City Council.
The Department has combined the reported data for the eight previous Auckland Councils into one – the table noted for Auckland that this is the sum of the former councils’ rates.
Are there other issues with the data?
Until recently there has been no standard definition of rates income for financial reporting purposes. The instructions for the local authority financial statistics ask councils not to include metered water income with rates income in their return to Statistics NZ. This means that for many councils the rates income reported by Statistics NZ may differ from the rates income reported in their annual reports. In addition there may be minor differences in the way councils report rates penalties and rates remissions. However, Statistics NZ is the only agency that collects a set of nationally comparable financial data for local government.
Does this mean that all ratepayers have had a rates increase similar to that shown in the table?
No, rates increases for individual properties will vary because of changes in property values over time. Many local authorities focus on the effect of their rates increase on an average ratepayer. Because they will also obtain additional rates from properties that have been newly developed or subdivided, the increase in income for each council will, in many cases, be a little greater than the increase for the average ratepayer.
How was local government debt calculated?
Total debt at 30 June 2010 was extracted directly from the Local Authority Financial Statistics. This data includes the “Term Debt” (from Non-current Liabilities) and “Current Debt” (from Current Liabilities) portions from the Statement of Financial Position.
Debt per capita was calculated using the debt figure above, together with the population figure for 2010 from the Statistics New Zealand estimates of sub-national population (30 June 2010). These population figures were also used for rates per capita.
The percentage change in debt for the period 2002-2010 was calculated by taking the difference between the 30 June 2010 figure, and that for 30 June 2002. This data also came from the Local Authority Financial Statistics.
Were there any errors in this data?
The figures for total local authority debt were correct. Total debt at 30 June 2002 was $1.980 billion and total debt at 30 June 2010 was $7.017 billion. This results in an overall change in debt for local authorities in New Zealand of 254 per cent over this period.
Data used in the original table for the Christchurch City Council did not include debt for the Banks Peninsula District Council (which existed up to 2004/05, but not in 2009/10). For consistency with the rates calculations the Banks Peninsula District Council data has been combined with the Christchurch City Council data. The consequence is that the increase in debt for Christchurch City Council has been revised from 199 per cent to 183 per cent.
At times, Statistics New Zealand updates their population estimates. Reviewing the data using the 30 June 2011 population estimates as part of this exercise, identified a change in the estimated population for Hamilton City Council for 2010. Consequently the Department has updated the debt per capita figure for that council from $2,184 to $2,179.
