After a marathon 10-hour meeting of Auckland Council’s Emergency Committee, Councillors yesterday agreed on the key priorities needed to guide the regional response to COVID-19 and its impact on the economy.
“Councillors were unanimous yesterday that the council needs to take decisive steps to reduce the pressure on residents and businesses facing economic hardship, while ensuring we can protect and maintain the essential services Aucklanders rely on,” said Mayor Phil Goff.
“I think Aucklanders want their council to understand the hardships that some people will be facing and show compassion and flexibility around that. There will be a range of measures to target support through deferral and postponement of rates for those facing genuine hardship and unable to pay their rates in the current circumstances.
“With a substantial reduction in non-rates revenue caused by the recession, some projects and services will need to be cut or postponed to reduce expenditure. Already many temp or contracted staff have been given notice.
“But Aucklanders will want us to continue to provide core services that the city needs, and which make our city a great place to live. Aucklanders will also want us to partner with the government to invest in the construction of vital infrastructure that the city needs, and which will contribute a stimulus to growth and jobs to assist our recovery.
“Auckland Council will consult with the public on a rate increase of 2.5 or 3.5 per cent. For the average ratepayer, a 2.5 per cent increase would be equivalent to an extra $1.35 per week, while a 3.5 per cent increase would be $1.83 per week.
“The Emergency Committee looked at all options for rate increases and the impact different levels of rate increase, including a zero per cent increase, would have on the ability of the council to provide services for Aucklanders and to invest in infrastructure for jobs.
“There will be a new round of consultation with Aucklanders providing a clear explanation of what each rating option would mean for council services and infrastructure and we will be providing robust information as part of the consultation document to ensure that picture is very clear,” he said.
The Emergency Committee has agreed a suite of measures to immediately offer some support to all ratepayers, including businesses, facing hardship due to the crisis:
- Waiving the APTR payment from 1 April to 30 June (2020) for all accommodation and tourism businesses
- Offering all ratepayers experiencing financial hardship the opportunity to defer payment of their fourth quarter rates instalments.
As part of the public consultation, Aucklanders will be asked if they support options including:
- A recommendation brought by the Mayor for both a 2.5 per cent and 3.5 per cent rate rise to be considered, with information included outlining the potential impact of both those options.
- A broadening of the council’s rates postponement policy to include businesses experiencing financial hardship.
- Suspension of the Accommodation Provider Targeted Rate, and the expenditure that it would fund, until 31 March 2021.
Mayor Phil Goff said, “The measures we agreed yesterday add to the strong financial support programmes already announced by central government. These changes will help to reduce the financial strain many Aucklanders are under as a result of the COVID-19 induced recession.
“Businesses in the accommodation and tourism industries are under particular pressure, so we are waiving the fourth quarter instalment of the APTR to provide some relief.
“All businesses and residents facing financial hardship will be able to request deferring their fourth quarter rates payments until the due date of the first rates instalment for the next rating year (31 August 2020) without penalties.
“Our priority is to look at what we can do in the area of rates to support those Aucklanders under real strain; acting to protect and maintain the key services Aucklanders rely on; ensuring we play our role in partnering with the government on the projects needed to kickstart economic recovery and employment, and taking a long-term view of the budget to ensure we can meet the short-medium term financial challenges posed by COVID-19 while continuing to invest in our region’s future.”
The Emergency Committee also requested staff to undertake further analysis of the impact different rates increases between 0 and 3.5 per cent would have on council services and business activity in Auckland. This analysis will help inform the public consultation process.
Finance and Performance Committee Chair, Councillor Desley Simpson said, “I believe that it is really important for Aucklanders to understand what services they might lose if we went for an even lower rates rise which is why this will be clearly outlined in the consultation document.
"We need to ensure our residential and business ratepayers are supported if they need assistance but at the same time keep key council services funded and operational. We know that not all ratepayers will be in a position to pay their rates during this financial hardship and that will impact on our income.”
"This is an emergency budget for extraordinary times."
Download the COVID-19 Financial Update here.