15 Sep 2015

Legal action possible over late Chch ratepayers

6:37 pm on 15 September 2015

Christchurch City Council is considering taking legal action against people who owe nearly $15 million in unpaid rates.

In June the council voted to raise rates over the next four years by more than 27 percent to pay for a $1.2 billion budget shortfall as the city struggles to pay for the post-quake rebuild.

14,534 people are behind rates payments to the tune of nearly $15 million, 500 people owe $20 or less.

Christchurch City Council

Christchurch City Council Photo: SUPPLIED

A council spokesman said it is working to obtain the money by serving formal demands on the mortgagee.

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"If there is no mortgage on the property in question, or the mortgagee refuses to pay the rates arrears, then the council would have to go through the courts."

Christchurch budget services chairperson Don Johnson said when some people buy a home they do not factor in the costs of rates.

He said the budgeting service has seen a huge increase in clients, with over 400 people seeking advice last year.

"The rates increases are making a huge dent in the average household, you can help it by paying monthly, but in most cases that is still over $200 a month.

"The people that I deal with are average families and they haven't done anything wrong, but they are cutting down on things like food just to pay their bills," Mr Johnson said.

Councillor Jamie Gough said the council needed to consider asset sales and other ways to cover the shortfall, rather than putting the burden on ratepayers

"It's beyond a joke at this stage, this new class of the working poor is emerging those who have worked hard their whole lives brought a house and now can not afford to pay their bills, it is the new normal and it's not fun.

"There are assistant packages available but at the end of the day that is pretty much like rearranging the deck chairs on the Titanic, it doesn't work for people. They're in a dire situation, the rates increases we have had are financially unsustainable," Mr Gough said.

Mr Gough said the council needed to take a good hard look at rate increases and figure out what to do differently, because the current increases are not working for people.

Businessman and financial lender Adrian Sisson said Christchurch rates have been increasing beyond inflation for the last 20 years.

"I started making submissions to the council about rates 30 years ago when my elderly mother was spending 10 to 15 percent of her income on rates.

"Even now elderly people are not getting out of bed because they can't afford heating, they are paying over $200 a month on rates and then another $200, $300 on their powerbills, it's just not adding up," Mr Sisson said.

Mr Sisson said the Council needed to take a step back and prioritise what was necessary for Christchurch, before increasing rates further.