By Rhea Dasent, senior policy advisor for Federated Farmers
Federated Farmers has a long history of submitting on Wairoa rates, so our ears pricked up when we saw the current Wairoa Rates Review.
We were especially interested to read in the Council’s own words “This proposal would simplify the rating system and transfer rates from the residential and commercial sectors to the rural and forestry sectors.”
Ultimately, Federated Farmers shares the same goals as the Council: Good quality local government services; a district we can be proud of; affordability for ratepayers; and equity between ratepayers.
We understand that the Council has four proposed changes to the rating system to achieve these goals. But the proposals will increase rates for farmers, which exacerbates inequity between ratepayers instead of narrowing it, and exacerbates unaffordability for a sector of ratepayers, being farmers.
Feds thinks that equity is better provided when there is a direct link between what services you use, what benefits you receive, and how much you pay.
Services such as reticulated sewage and tap water should be user-pays by ratepayers who are actually connected to these networks. This is why Federated Famers opposes the Councils idea to make 10% of reticulated services funded by the general rate.
There should be no need for the general public to pay for a farmer’s own septic tank, and likewise farmers should not have to pay towards town sewage systems.
Affordability can be achieved by innovative use of the rating mechanism toolbox for the benefit of all ratepayers. Flat fees can help immensely with affordability.
The current Recreation rate based on land value will have a farm with a $1.5m land value paying $360 per year for parks, and a house in Wairoa town with a land value of $38,000 paying $212.
If this was changed to a flat fee then both would pay only $138 (total cost of parks and reserves $998,893 divided by 7,207 rateable units in the district).
We liked the Council’s aims to simplify rates and make them more affordable, but the proposals don’t quite achieve these. We hope that the Council takes another look at rates and checks out the alternative ideas we gave them in our submission.