Media statement
Friday, April 27, 2012

Auckland Businesses Shouldering Unfair Rates Burden

Though Auckland is a world class city for livability, the business environment is being short changed, the Employers and Manufacturers Association (EMA) told the hearing on Auckland Council's long term plan today.

EMA said the Council's plan to charge Auckland businesses $150 million more than if there were no differential demonstrates the issue.

"Business ratepayers are being called on to shoulder an unfair share of the city's rates and future debt repayments," said EMA's Peter Atkinson.

"The business rate planned means businesses will pay 2.63 times more than other ratepayers, or $150 million a year more than if there were no differential imposed.

"Auckland now sets its rates based on the capital value of property but other cities that do the same, such as Tauranga, do not also penalize their businesses with a rates differential," Mr Atkinson said.

"Tauranga is a stand out city for growth.

"As a result of the penalty Auckland's businesses will pay the lion's share of the city's debt over the next 10 years which is set to nearly triple from $2.9 billion to $8.4 billion.

"This is not a recipe for making Auckland business friendly. The Council is planning to hamstring our businesses and job opportunities.

"It would be far better to increase the Uniform Annual General Charge (UAGC) from $350 to $650.

"The average UAGC across Auckland's previous eight councils used to be 18 per cent of rates but now its being reduced to 12 per cent.

"We have said for years the UAGC should be the maximum allowed by law which is 30 per cent, but as an interim measure we would be pleased to see it increased to $650 per property, which would be 23 per cent.

Other matters raised were:

* Objection to waste water differential

* Planning for business land inadequate

* Performance measures recommended

Mr Atkinson said business strongly objects to Council setting a waste water differential against business. Its totally arbitrary and unjustified, he said.

"Charging everyone the same rate, by the amount they send down the drain is the only fair method," he said.

"The Council's proposals for providing business land fall far short of the ideal. The target of building 75 per cent of all new housing and business within the existing 'metropolitan urban limit' (MUL) is neither achievable nor desirable.

"The proposed provision of land available for business will only be enough for five years of development, nowhere near enough for a 10-year plan.

"To help improve Council governance we suggest the Council establish performance measures such as surveys of public opinion to show the levels of satisfaction with Local Board and Council decision making."

ENDS

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