What does it mean when politicians say rates increases will only be at the rate of inflation?

When the “Super City” was formed in Auckland we were told by the politicians that there would be huge savings to be had as result of amalgamation.

Most of us thought that would mean rates reductions. We were all wrong.

Then the citizens of Auckland elected Len Brown who proceeded to tell us all that average rates increases were at the rate of inflation, or a small percentage above. We foolishly re-elected him in 2013 and he proceeded to ratchet rates up even higher once the 10% legislative cap was removed. The last rates increase was described as an average of 9.9%.

But what does that mean in reality?

A reader emailed me. He is superbly well qualified to perform the necessary calculations, but has requested that his name be withheld.

Cam

The reason for this note is that I was doing the home office expense analysis for my tax return and I thought you might be interested in the Auckland City rates component on our home: ?

  • Rates 2009 (including ARC): $4,324;
  • Rates 2016: $6,894.

That?s a nominal increase of 59% (44% inflation-adjusted) or 6.9% a year compound. ?Inflation over the period was 11% or 1.5% a year compound.

I hadn?t noticed a commensurate increase in service (the reverse actually) but it is time these numpties were held to account. ?I do not think any of the current crop of mayoral nominees has the cajones to make the needed difference.

Basically politicians use weasel words to lie to you…to make you think that things aren’t that bad.

A near 60% increase in rates for this person isn’t out of the ordinary in Auckland, and some areas have had even higher increases.

We should not be voting for any politician unless they agree to rates reductions. Enough is enough.

We simply do not have any time left for politicians who talk in corporate weasel words and want to have constant “conversations” about issues.

We are done talking. It is time for actions.

 

– tipline

 

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