Source: Taxpayers Union
2020 Ratepayers’ Report released, methodology explained
The New Zealand Taxpayers’ Union, in partnership with the Auckland Ratepayers’ Alliance, has today published the 2020 edition of Ratepayers’ Report – online local government league tables – at www.ratepayersreport.nz.
With these league tables, New Zealanders can easily compare their local council’s performance and financial position for 2018/19 against others.
Setting out more than two thousand data points, the Ratepayers’ Report provides transparency for ratepayers, and rates figures are presented on a per-household basis to ensure fair comparisons between councils. The league tables rank councils on metrics including average residential rates, staffing costs, and council liabilities among others.
Taxpayers’ Union Campaign Manager Louis Houlbrooke says, “Every dollar spent by a local council was earned by a hard-working ratepayer. Ratepayers’ Report allows ratepayers to understand if they could be getting a better deal. The league tables reveal huge disparities between councils in terms of how much they take in rates, how much they owe in liabilities, and how much they spend on salaries. The league tables suggest there is major scope for councils to find efficiencies to reduce the burden on ratepayers.”
Carterton District Council now ranks highest for average residential rates at $3,472, just pipping Auckland Council at $3,469.
The lowest average residential rates in New Zealand are levied by the Central Otago District Council at $1,444.
Christchurch City Council continues to have the highest liabilities per household compared to any other council ($27,510) – up from last year. Auckland Council follows in second place, with liabilities per household of $25,372 – another significant increase from last year.
The average liabilities per household of all councils is $6,144.
There are were 2,831 staff paid salaries greater than $100,000 at Auckland Council and its CCOs.
The least efficient council in terms of staffing is Waitomo District Council, with a staff member for every 20 households. The most efficient is Thames-Coromandel District Council, with a staff member for every 128 households.
Only four Councils meet the full criteria for prudent Audit and Risk Committees. Western Bay of Plenty District Council failed to have a separate Audit and Risk Committee while Grey District Council didn’t have one at all, which is considered basic financial prudence.
All figures are based on the 2018/19 financial year, and therefore do not reflect changes in council positions caused by COVID-19 and the ensuing 2020 budgets.
Highest and lowest council rates in New Zealand revealed
The New Zealand Taxpayers’ Union’s 2020 Ratepayers’ Report reveals the highest and lowest average council rates in the country. The league tables are available at www.ratepayersreport.nz.
Taxpayers’ Union spokesperson Louis Houlbrooke says: “The key attraction of Ratepayers’ Report has always been the league table for average residential rates, which uses a standardised formula to include all residential rates, local taxes, and levies.”
“This year’s table has a new champion of high rates, knocking Auckland Council and Kaipara District Council off the top. Carterton District Council has moved up the rankings from third last year to take out the title of the highest-rating council in 2020, charging $3,472 on average for residential rates.”
“However, our largest city continues to loom large in second place, with Auckland Council charging an average rates bill of $3,469 – only just below Carterton, and well ahead of Christchurch ($2,588).”
“On the other end of the table, Central Otago District Council is now officially the lowest-rating council. Central Otago charges less than half what Carterton and Auckland do.”
“The average residential rate nationwide is $2,445 – an increase of $84 from the previous year. Councils are extracting even more rates, taxes and levies from the average ratepayer, but the range of different rates levels in the league table demonstrates that high rates need not be an inevitability. High-rating councils should take notes on how others are able to run tighter ships.”
Highest average residential rates:
Carterton District Council: $3,472
Auckland Council: $3,472
Tasman District Council: $3,186
Western Bay of Plenty District Council: $3,168
South Wairarapa District Council: $3,151
Lowest average residential rates:
Central Otago District Council: $1,444
Grey District Council: $1,739
Mackenzie District Council: $1,884
Southland District Council: $1,914
Otorohanga District Council: $1,919
Data for the report was compiled by the Taxpayers’ Union and was supplied to all councils for review (and any necessary correction) prior to publication.
Ratepayers’ Report facilitates straightforward comparison of average residential rates via a formula first used by Napier City Council which allows for an ‘apples to apples’ comparison of average residential rates and charges, based on each council’s definition of a residential rating unit. Only Kaipara District Council was unwilling to provide the Taxpayers’ Union with the necessary rates information, while Wellington City Council did not respond to our request.
This formula was also used to ascertain non-residential average rates for the first time. A number of councils were unable or unwilling to provide us with this information.
For non-rates figures (i.e. liabilities, personnel costs) we have this year assessed council data using Stats NZ’s 2018 census, with some councils opting to replace this with a more recent figure. We have done this because councils have different definitions of what constitutes a residential ratepayer or ‘rating unit’.
What is the purpose of Ratepayers’ Report?
Ratepayers’ Report provides accountability and transparency to New Zealand ratepayers by allowing them to compare their local territorial authority with others around the country.
Where was the data sourced?
The Taxpayers’ Union compiled the data in Ratepayers’ Report after reviewing each council’s annual report for the year ending June 30, 2019.
Other figures were mostly obtained under the Local Government Official Information and Meetings Act, and cover the 2018/19 financial year.
The data has been sent to each individual authority for their review and error checking prior to public launch.
Population and household data is from Stats NZ.
Where did the group finance figures come from?
They are taken from each Council’s annual report. They are council figures, plus all those of subsidiary council-controlled organisations.
Which councils are assessed in Ratepayers’ Report?
Of New Zealand’s 67 territorial authorities, 66 are examined in Ratepayers’ Report. That includes all city, district, and unitary councils, with the exclusion of the Chatham Islands Council (due to concerns surrounding that Council’s workload pressure and unique position).
What about regional councils?
While we anticipate including regional councils in future editions of the Report, the data we have on their average residential rates bills is at this stage incomplete. Our research suggests that regional councils charge anywhere from $42 to $553 per residential ratepayer on top of the bill charged by territorial authorities. Gaps in the data and different definitions for residential ratepayers dictate that these figures should be considered as supporting evidence, rather than determinative.
Is this the first Ratepayers’ Report?
No. Ratepayers’ Report was first published in 2014 jointly by the Taxpayers’ Union and Fairfax Media (now Stuff). The Taxpayers’ Union have since published updated versions in 2017, 2018 and 2019. This is the fifth edition.
How are the councils grouped?
Unitary authorities – the 5 territorial authorities which also carry out the functions of a regional authority are grouped.Metropolitan – the 5 large councils with a population of over 120,000.City – 6 smaller metropolitan councils with populations between 40,000 and 120,000.Provincial – the largest group, 27 non-metropolitan councils with population over 20,000.Rural – the remaining 23 councils.
How was the average rates calculated?
Calculating an ‘apples to apples’ figure for residential rates is difficult because councils use various mixes of rates, levies, and user charges. Our approach is based on work by Napier City Council to find an average residential rate. The methodology councils were asked to use to calculate the figures disclosed in Ratepayers’ Report is available here.
The report also included average non-residential rates for the first time this year using the same methodology.
While we think this approach is useful and fair, the average residential and non-residential rate figure should be a guide only.
Unitary authorities (Auckland Council, Nelson City Council, Gisborne, Tasman, and Marlborough District Councils) perform the functions of a regional council and therefore can be expected to have higher rates than other territorial authorities.
Were councils consulted in the process?
Yes. Every council was sent a draft version of their respective data to review.
Can the results of the 2020 report be compared to the 2019 edition?
All non-rates figures (i.e. liabilities, staff) were assessed using council data from Stats NZ’s 2018 census figures, with some councils opting to replace this with a more up to date figure. We have done this because councils have different definitions of what constitutes a residential ratepayer or ‘rating unit’.
The methodology means that the per-household figures can be compared with the 2019 report, but not with the 2018 report which used a per-ratepayer figure (aside from the average rates metric which has remained consistent).
What are the potential limitations of Ratepayers’ Report?
Queenstown-Lakes, Taupo, and Thames-Coromandel District Councils have previously objected to the use of Stats NZ’s household figures, as these tend to exclude properties left empty, i.e. baches. As a result, per-household figures for these districts may be somewhat inflated. This does not affect the rates figures, which are based on rating units.
Empty or undeveloped sections are counted as rating units. This means the average residential rates figure for a territory with a high proportion of undeveloped sections, such as Wairoa District Council, may appear relatively low while the actual level of rates levied on an average Wairoa homeowner is likely to be higher.