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Why Councils Need to Live Within Their Means

Councils must get back to basics, live within their means, and treat ratepayer money with the same care that families apply to their own budgets. Because, if they do not, the pressure on communities will only grow and confidence in local government will continue to erode.

Photo by Towfiqu barbhuiya / Unsplash

Table of Contents

Steve Gibson
Hastings District Councillor

Across New Zealand, councils are drifting away from a simple principle that every household understands. You cannot spend more than you earn and expect it to end well. In Hastings, where I serve as a councillor, we are seeing this play out in real time.

Our council has approved a draft annual plan with a 9.1 per cent increase in spending. That is roughly three times inflation. At the same time, ratepayers are being asked to accept higher rates while the council borrows $4.8 million just to fund day-to-day operations.

That should ring alarm bells for anyone who manages a budget, whether it is a household, a farm or a business.

Borrowing to build long-term infrastructure is one thing. Borrowing to keep the lights on is something else entirely. It is a sign that spending has got ahead of reality.

I stood against this approach and put forward an alternative that proves there is another way. My proposal holds rates to around inflation, removes borrowing for operational costs and refocuses council on its core responsibilities. It does this not through reckless cuts, but by making practical choices about what is essential and what is not.

Non-core activities are scaled back or paused. That includes areas like the art gallery and the Waiaroha water museum. Parks and reserves are maintained in a more cost-effective way. Library services continue, but with reduced hours that reflect financial reality. We also look hard at staffing in non-core areas and make better use of existing buildings rather than expanding costs.

The outcome is a balanced budget. No operational borrowing. No kicking the can down the road. This is not extreme: it is simply disciplined.

But there is another issue that ratepayers are increasingly questioning. While costs continue to rise, councils are spending time and energy on matters that many see as ideological rather than essential.

In Hastings, we have seen controversy around a walk on the flag exhibit at the art gallery, something many in the community found deeply offensive. At the same time, governance structures are shifting, with unelected mana whenua representatives and appointed experts taking positions alongside or instead of elected councillors on major entities like water services.

Whether one supports those moves or not, the concern is this: Are councils losing focus on their core job?

Ratepayers expect roads maintained, water delivered, waste managed and essential services run efficiently. That is the contract.

My experience in Hastings is not unique. It is a snapshot of a wider problem across the country.

Councils must get back to basics, live within their means, and treat ratepayer money with the same care that families apply to their own budgets.

Because, if they do not, the pressure on communities will only grow and confidence in local government will continue to erode.

Councils need to decide who they serve. Theories and trends, or the ratepayers who fund them.

It is time to get back to basics.

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