Taranaki councils delay works to squash rates rises

New Plymouth and South Taranaki councils are looking to cut rates increases, largely by delaying spending on basic infrastructure.

Both councils will set Annual Plan budgets soon, and staff have set out options to meet councillors’ expectations of more frugal plans.

New Plymouth District Council meets on Wednesday to consider a 2026-27 budget that trims a further $10.8 million from capital spending on infrastructure and community facilities.

Already in February New Plymouth councillors had cut $15 million from capital spending including stormwater and sewer pipes.

The reduced spend matched what staff said NPDC could realistically achieve, with managers conceding the council lacked capacity to deliver a planned $150 million programme.

More delays to infrastructure work are needed to meet Mayor Max Brough's rates promise

New mayor Max Brough’s campaign promise of a rates rise below five percent was met under February’s across-the-board cuts.

But in a report for Wednesday’s meeting, staff say it would be “prudent” to further reduce next year’s capital budget to $123.5 million – an 18 percent cut to initial planned spending.

The council will have to cut further: the report advises “the 4.9 percent rates increase requires an additional $500,000 of as yet to be identified reductions … during the 2026-27 financial year.”

Election opponents had warned Brough’s rates target would mean deep cuts to works and services, greater debt, or both.

The report says adjusting for February’s cuts to future capital spending already meant less work than expected would be done this year.

“Further, increasing global geopolitical uncertainty has resulted in increasing fuel costs along with associated inflation and supply chain disruption risks,” the finance and planning team advised.

South Taranaki District Council staff are also recommending spending less on capital works as the council finalises its 2026-27 budget.

STDC’s long-term plan predicted a rates increase of 6.2 percent, but initial budgets in February showed that had increased to 7.2 percent.

Councillors said that wasn’t good enough given cost-of-living pressures and affordability for ratepayers, telling staff to come back with rates rise under 6 percent.

As in New Plymouth, the officers’ report proposes to “reprioritise the capital works programme to align with previous achievements.”

“Council officers have reviewed the three waters’ capital works programme to assess whether it is realistic and deliverable within current organisational capacity and resourcing constraints.”

The scale of reduction isn’t specified but the report suggests capital expenditure of $16 million “with a number of projects proposed to be re-phased into future years rather than removed altogether.”

Proposals to achieve a 5.97 percent rates rise also include holding back on funding depreciation.

The report says higher non-funded depreciation would see less money available to keep assets up to scratch, so STDC risks borrowing more to cover gaps.

Officers recommend the council “mitigate this risk and avoid a prolonged impact” by increasing depreciation funding in future.

Once New Plymouth and South Taranaki councillors have considered the recommendations, staff will draw up final budgets to be agreed or adjusted before the end of June.

nā Craig Ashworth craig@tekorimako.co.nz

LDR is local body journalism hosted by Te Korimako o Taranaki and funded by Te Reo Irirangi o Aotearoa and Irirangi te Motu