27 Apr 2016

Mayoral hopeful has big plans but little detail

5:48 am on 27 April 2016

The National Party-aligned Auckland Future ticket, and the independent mayoral candidate Vic Crone's joint Fiscal Responsibility Pledge, sells the message of lower rate rises and smaller council budgets.

Auckland Future's Denise Krum, left, and mayoral candidate Vic Crone launching the join Fiscal Responsibility Pledge.

Auckland Future's Denise Krum, left, and mayoral candidate Vic Crone launching the join Fiscal Responsibility Pledge. Photo: RNZ / Todd Niall

The average residential rate rise would be capped at 2 percent in each of the three years next term, $500 million extra would be cut from council budgets over eight years, and staff numbers would be frozen.

In an interview with Ms Crone and Auckland Future's candidate and sitting councillor Denise Krum, the pair couldn't say much more about what the pledge will mean.

Take the 2 percent residential rates cap, how much less revenue would that bring in than the currently proposed 4 percent averages?

Ms Crone couldn't give a figure, it "would depend", it would "not be significant", and "would not impede the ability to invest".

The real answer, based on council data, is that about $20m less would flow into council coffers each year.

The pair repeatedly talked about the certainty the pledge would give residents.

Leading mayoral contenders, from left, Victoria Crone, Mark Thomas and Phil Goff on stage together for the first time.

Leading mayoral contenders, from left, Victoria Crone, Mark Thomas and Phil Goff on stage together for the first time. Photo: RNZ / Todd Niall

So what about the other components of household's rates bills, such as the $114 flat Transport Levy introduced last year, would that remain?

They would "review it", and "not in the first two years". In fact the levy has only two more years to run, having been introduced as an interim measure ahead of new transport funding sources still to be discussed with the government.

What about the contentious Uniform Annual Charge?

The UAGC makes up a portion of household's total rates set as a flat fee of $397. Some centre-right councillors want a higher flat charge, which would lower the proportion of rates determined by property value, and bump up rates for lower-value properties.

Ms Crone and Auckland Future are waiting to see what people say on the issue in consultation for this year's annual budget. So would they be bound by the outcome of that consultation? "No."

Victoria Crone

Victoria Crone Photo: Supplied

The other key headline pledge is a commitment over eight years to trim the council group budget by $500m, over and above a savings programme being currently driven by the council.

Where would the savings come from? "Back office," said Ms Crone. No services would be cut. The half billion dollars would be cut from how the council runs itself.

The Fiscal Pledge is a significant step in this year's election campaign. It strongly signals the thinking not only of a mayoral candidate, but the political ticket she is aligned with.

However voters will need and deserve more detail over the next months before deciding it's merits.

It's not the first fiscal policy to be released. Centre-right leaning Mark Thomas plans to offer Aucklanders the "option" of a rates freeze. This would cut council revenue by $50m plus. Other choices would be a 2 percent or 4 percent average rates rise.

No candidate has yet properly detailed how their headline figures can become reality.

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