Brown pointed out during the debate today that \u201cactually a lot of work\u201d was done to get to the 7.9% rise, especially considering the added pressure of the fuel crisis.<\/p>\n
\u201cIt\u2019s easy to say \u2018woe is me\u2019. We\u2019ve got this railway. If you don\u2019t pay for it this year, you\u2019re just going to pay for it next year,\u201d he said.<\/p>\n
\u201cThe CRL budget was out of control before I arrived. We\u2019ve got this down to nought plus a railway. It\u2019s easy to say how terrible things are … as if we didn\u2019t know.\u201d<\/p>\n
Rising fuel costs are estimated to have increased the council\u2019s operating costs for 2026\/2027 by at least $25m, although the figure might be $50m or more if fuel prices increase further.<\/p>\n
The mayor took aim at Gillon\u2019s amended 5.9% rates rise proposal, describing it as \u201cmore showmanship\u201d.<\/p>\n
\u201cWe should be responsive to change, not responsive to sloganeering.<\/p>\n
\u201cYou might have said you ought to make the railway a hell of a lot cheaper, but you didn\u2019t.\u201d<\/p>\n
Auckland councillors interrogated the detail of Gillon\u2019s amendment to raise operational savings to $166m, inclduing options of \u201cdelaying the strategy of fully funding depreciation by one year\u201d and \u201cdeferring the $7 million major events funding shortfall\u201d.<\/p>\n
In order to fund these savings, Gillon\u2019s amendment requested Auckland Council chief executive Phil Wilson reported back on several options.<\/p>\n
These included a freeze on filling non-essential staff vacancies for one year, non-essential travelling, advertising, subscriptions and ceremonies.<\/p>\n
Other cost-saving options included capping external consultancy and professional services, ceasing the food scraps collection and lowering or removing the Green Star certification requirement on new builds, which aims to minimise energy and water consumption.<\/p>\n
\u201cI think 7.9% is too high when you consider the cost increases everywhere at the moment, and lots of households are really struggling,\u201d Gillon told the Herald yesterday.<\/p>\n
\u201cIt\u2019s difficult just to make ends meet so now\u2019s not a good time to be increasing rates by the biggest increase that the Super City has had.\u201d<\/p>\n
Councillor Richard Hills today pointed out Gillion\u2019s suggestion that deferring the $7m major events funding shortfall would mean there would be no ASB Classic, Auckland Fashion Week, Auckland Writers Festival, Auckland Marathon and the New Zealand Warriors would not be playing on Anzac Day.<\/p>\n
Hills said Christchurch would be \u201clicking their lips\u201d at the prospect of luring the All Blacks away from games in Auckland without that Major Events Fund.<\/p>\n
Auckland Council chief executive Phil Wilson (left) and Auckland Mayor Wayne Brown ahead of the 2026\/2027 rates vote. Photo \/ Dean Purcell<\/p>\n
Brown said he knew Gillion\u2019s amendment was made with \u201cgood intentions\u201d but \u201cthe road to Purgatory is paved with them\u201d.<\/p>\n
Brown pointed out that one of Gillion\u2019s suggestions, that there be a freeze on hiring non-essential staff, was already in place.<\/p>\n
The mayor also took issue with the fact Gillon\u2019s amendment didn\u2019t take aim at local board funding, which he described as \u201cone of the most bloated parts of our organisation, who have never been under an intensive review\u201d.<\/p>\n
Brown said on Monday new inflation forecasts and global fuel pressures \u201cadded a massive $213m risk to our budget\u201d.<\/p>\n
\u201cWithout our $106m savings plan, that volatility could have forced a 15% rates hike on Aucklanders. Instead of taking the easy way out and passing that straight on to ratepayers, we are choosing strict discipline and internal savings.\u201d<\/p>\n
Deputy Mayor Desley Simpson said Gillion\u2019s amendment, backed by councillor Bo Burns, should have been \u201cgiven more slack\u201d and in fairness she said they had done well, given they were \u201cnew to the town hall table\u201d.<\/p>\n
Simpson said she would like to see a lower hike than the proposed 7.9% but she didn\u2019t think it could go as low as 5.9%.<\/p>\n
\u201cWhat this amendment does is it adds another $60 million … which means we\u2019re well staring down the barrel of well in excess a quarter of a billion dollars, a bit over $270 million [in budget risk] in one year. Now that\u2019s the figure we\u2019re trying to achieve in a whole term.<\/p>\n
\u201cWe\u2019re also at risk of going down on our credit rating. Any basis point added to our borrowing will be passed through to higher costs for us. Now we are already on a negative watch.<\/p>\n
\u201cI like some of your suggestions … we\u2019ve already started looking at them,\u201d she said, adding that this has been directed on to staff in the search to make the original $106m operational savings part of the 7.9% rise.<\/p>\n
Simpson said that, sadly, she couldn\u2019t support the amendment \u201cbecause the underlying factor is you\u2019re adding $60 million to the already $213 million that we\u2019re finding\u201d and the \u201cmagnitude\u201d of that budget risk was unacceptable.<\/p>\n
Councillor Bo Burns, who seconded Gillon\u2019s amendment pointed out that in reality the 7.9% rates increase was only the average and that many Aucklanders will face an \u201ceffective\u201d rates hike between 12-15%.<\/p>\n
Councillor Shane Henderson also said he could not support the amendment because it would likely lead to a credit downgrade from delaying the strategy of fully funding depreciation by one year.<\/p>\n
Earlier today during question time, Hills asked about the impact of a possible downgrade in Auckland Council\u2019s credit rating, due to rating agencies\u2019 concern about the Government\u2019s rates cap, and other factors including the fuel crisis.<\/p>\n
Hills asked if this would mean some of the proposed rates increase could just go to meet increased interest, via the ratings agencies, on the council\u2019s billions of dollars of debt.<\/p>\n
Tucker accepted this possibility, saying it \u201cwould aggressively increase\u201d costs of $5-$10m \u201cas we price debt\u201d.<\/p>\n
Yet eight councillors supported Gillon\u2019s ammendment.<\/p>\n
One of those was John Watson, who said it was misleading to define today\u2019s 7.9% rates increase as \u201ca one-off\u201d, pointing out rates increase are a consistent trend in Auckland. Many of his constituents had faced a 10-20% rates increase in the last year, he said. <\/p>\n
\u201cThat\u2019s baked in now … and we just give the tired all excuses \u2018oh it could be worse\u2019,\u201d Watson said of the continual rates rises.<\/p>\n
\u201cYou have to ask where does it all end?\u201d he said. \u201cThere are a lot of people out there who are not going to be able to pay those rates.\u201d<\/p>\n
Councillor Mike Lee also supported the 5.9% ammendment and said the continual rates increases were always justified by an \u201cexternal crisis\u201d such as Covid, floods and now the fuel crisis.<\/p>\n
\u201cIt\u2019s never about us,\u201d Lee said, referring to the council.<\/p>\n
The Waitemat\u0101 Ward councillor said the council should look at home for savings, saying there were three internal council finance departments.<\/p>\n
Councillor Christine Fletcher said she was regularly accosted by people in the shopping centre saying they have no further money to give to the council.<\/p>\n
\u201cIt is not business as usual,\u201d Fletcher said, accusing the governing body of sitting in an \u201civory tower\u201d.<\/p>\n
\u201cAll of us are feeling a little fearful about the future right now,\u201d she said.<\/p>\n
\u201cI do think [the] council are tone deaf on this issue.\u201d<\/p>\n
Brown\u2019s draft proposal of a 7.9% rates increase was announced on December 1, directly after Prime Minister Christopher Luxon confirmed the Government would introduce a rates cap of 2% to 4% from January 2027.<\/p>\n
Auckland Council\u2019s Long-Term Plan 2024-2034 (LTP) aimed to reset the council\u2019s financial position after a period of higher inflation, costly storm events and the completion of the CRL.<\/p>\n
The LTP had projected a rates increase for 2026\/2027 of about 11% might be required to fund the $235m annual operating and ownership costs of the CRL.<\/p>\n
However, the LTP set an additional savings target of $106m for 2026\/2027 to achieve a planned rates increase of 7.9%.<\/p>\n
General rates are based on the capital value of a property and fund a range of services available to all Aucklanders, including libraries, pools, parks, roads, footpaths, stormwater services and public transport.<\/p>\n
For the average-value residential property in Auckland, the 7.9% rates increase will equate to $320 a year, or $6.16 a week.<\/p>\n
Voting in favour of the 7.9% rates rise were Brown, Simpson and the following councillors: Andy Baker, Josephine Bartley, Julie Fairey, Alf Filipaina, Lotu Fuli, Shane Henderson, Hills, Daniel Newman, Sarah Paterson-Hamlin and Greg Sayers.<\/p>\n
Councillors who opposed it: Bo Burns, Christine Fletcher, John Gillon, Mike Lee, Ken Turner, John Watson and Maurice Williamson.<\/p>\n