Evidence Supports ACT Opposition to Local Body Amendment Bill

A growing gap between local authority rates revenue and expenditure shows why opponents to the Local Body Amendment Bill are justified in fearing the "powers of general competence" the Local Government Bill will give councils, ACT New Zealand Deputy Leader Ken Shirley said today.

"ACT analysis of official statistics show that local bodies are already building up reserves for major investment.

"Although local authority expenditure has risen in excess of inflation (up 14.1 percent in four years), rates revenue has risen even faster (up 19.4 percent).

"The result is a stockpile of ratepayer cash in local body coffers. The gap between expenditure and income has more than doubled since 1998, from $135m to $335m.

"What this means is that local authorities - which spend a billion dollars every quarter - have a ready supply of cash to involve themselves in any kind of business, whether it competes with ratepayers or not. And once this Government's new legislation is enacted, councils around the country will have the ability to do just that.

"The fact that eight percent of rates aren't currently spent shows local authorities are already gearing up for their frightening new powers," Mr Shirley said.

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