Council updates  |  23 Feb 2023

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As the city navigates a complex economic environment, Councillors are meeting to finalise Christchurch City Council’s draft budget for the coming year.

On Tuesday 28 February Councillors will meet to approve the Draft Annual Plan 2023/24, which outlines what the Council will spend on projects and day-to-day services over the next financial year and how it will pay for them.

The plan proposes a 5.58% rates increase across all ratepayers, and 5.68% for the average household. 

 The main proposals

5.58%

Overall average rates increase across all properties. This is slightly higher than the 5.42% in the LTP.

5.68%

Average proposed rates increase for a typical household.

$585.2 million

Operational spend. This is $48.4 million more than what was in the LTP. This is spending on the day-to-day services the Council provides. The increase is mainly due to higher inflation and higher insurance and electricity costs.

$615.4 million

Capital spend invested into the city. This is spending on the construction of facilities and infrastructure, and is $137.3 million less than what was in the LTP as updated by the FY23 Annual Plan.

$233 million

Borrowing for the capital programme is $179 million less than planned in the LTP.

Chief Executive Dawn Baxendale says the Council is facing the same problems every other organisation in the world is facing to one degree or another.

“We’re all very familiar with the forces that are playing out across New Zealand and worldwide. We’re planning ahead in an environment with rising interest rates, inflation, supply issues, a tight labour market and geopolitical instability.

“These are all reasons, but not excuses. Over the last few months my staff, alongside our new elected Council, have pulled out all the stops to keep this year’s proposed rates increase well below the general 7% inflation rate we’re seeing across New Zealand,” Mrs Baxendale says.

The proposed rates increase is significantly lower than the 14.6% presented to Councillors in late 2022.

“Importantly, we’ve done this without compromising the services and facilities enjoyed by all our residents, investment in our city’s future, or keeping our Council agile so we can respond quickly to external influences, whatever they may be.”

Keeping the proposed overall rates increase to 5.58% has been achieved through a mix of approaches:

  • A range of one-off savings, including leaving some staff vacancies unfilled for 2023/24 and revisiting some of the cost-saving measures Councillors first considered when developing our Long Term Plan 2021–31.
  • Keeping the Council’s programme of capital works focused on what’s actually achievable right now, and avoiding charging rates for projects that aren’t realistically able to be delivered until future years.

“It doesn’t leave us as many rabbits to pull out of the hat in future years as we’d like, but our communities are feeling financial pressure right now, and we need to act right now,” Mrs Baxendale says.

Rates increases for households will also be affected by the rates revaluation, which saw new capital values released in February, and a significant increase among residential properties.

“I want to remind everyone that the revaluation has no impact on the Council’s overall rates revenue, but it does affect how this is shared out between property owners,” Mrs Baxendale says.

“Because the value of residential properties has risen further than the value of business properties, our Draft Annual Plan also proposes a change to the business differential we charge business ratepayers, to help us keep the proportions the same as previous years.

“The details of all our proposals will be available when the Draft Annual Plan 2023/24 goes out for public feedback next month.”

If approved, the Draft Annual Plan 2023/24 will go out for consultation on Friday 10 March to Monday 10 April, where all residents can have their say on the Council’s proposals.