23 Jun 2016

Christchurch rates to rise

12:08 pm on 23 June 2016

Rates for Christchurch residents will rise by 4.9 percent in the coming financial year, after the council voted in favour of the increase today.

Christchurch City Council

Christchurch City Council Photo: 123rf.com

The rise is one of a raft of measures passed today as part of the council's annual plan.

The rates rise is less than the 7 percent originally proposed last year, as part of the long term plan.

The budget also places on hold further asset sales, which were not due to resume until the following financial year, and have been scaled back from $750 million to $600 million.

A small group protested planned asset sales by the Christchurch City Council at its meeting today.

A small group protested planned asset sales by the Christchurch City Council at its meeting today. Photo: RNZ / Conan Young

'Great for Christchurch' savings start to bite

The council is starting to feel the strain from cost-cutting measures, an update to councillors has revealed.

The 'Great for Christchurch' initiative was launched at the beginning of 2015 and aims to find savings of $43 million over a three-year period.

The council is struggling to meet the cost of the post-earthquake rebuild and has been forced to increase rates and sell non-strategic assets to balance its books.

The 'Great for Christchurch' programme is looking for savings in procurement, middle and back office activities and through the increased use of information technology, but as the council report made clear, this has its limits.

It said the programme was on track to achieve its target of $6m in savings in its first year but "the cumulative impact of operational budget reductions is starting to strain our delivery capacity".

"Unless carefully managed, [this] will ultimately constrain opportunities for improved services," it said.

Although services had not suffered, the report said it was a risk because of cost pressures "through inflation, wage increases, and population-driven service demands".

The report warned it was often not possible to "continually change" and asked for a period of consolidation before the council re-launched "the next transformational change initiative".

The programme was running alongside another cost-cutting initiative called 'Fit for the Future' looking at staffing and management which aimed to save $3.8million over three years.

The council was also in the process of getting valuations done on 160,000 properties so it could set the following year's rates.

Residents said it was naive to rely on people's honesty for the valuations.

Vote to end homelessness

Meanwhile, the council also voted in favour of eliminating homelessness as part of its draft housing policy, which will now be released for public feedback.

However, the goal would not be supported with any extra money at this stage.

The city was struggling to provide enough housing after much of its stock of affordable accommodation was damaged beyond repair by the earthquakes.

Families have been living in garages or cars.

The document said that while rents had reduced thanks to the rising number of replacement houses being built, many were still falling between the cracks.

A staff report said that if the housing policy was adopted, funding of up to $500,000 could be made available in next year's budget to help people into accommodation through working with the social housing sector.