PM warns council bosses against costly rate rises

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Prime Minister John Key has urged the country’s local Government leaders to think carefully about “unaffordable” rate rises. 

Key addressed more than 500 delegates at the two-day Local Government New Zealand conference at Queenstown’s Millennium Hotel this morning about the importance of the relationship between central and local Governments. 

Central Government has tightened its belt due to the global financial crisis and he says local government needs to do the same.
 
“Times are tough and ratepayers just can’t endure unaffordable rate rises.
 
“We aren’t telling you how to do your jobs, but we would urge you to think carefully about the capacity of your communities during these difficult financial times,” Key says. 

“I know it’s not easy, and it’s tempting to think your council is an exception or faces special circumstances, but we all have to face up to making difficult choices.” 

New Zealand’s 78 councils manage $100 billion worth of assets and spends $7.5 billion of public money each year.
 
Key says just like central Government, councils have a role to play in creating an environment that is beneficial to sustained economic growth.
 
“We may not always agree, but being able to discuss our differences in a constructive way is the sign of a healthy relationship.”
 
He told the leaders that their job is not an easy one and they face high expectations from their communities and individuals. 

“Ratepayers and taxpayers alike require assurance that money is spent wisely, and on the services that matter to them.”
 
The Prime Minister says Government will not force any amalgamations but urged local government leaders to consider healthy community debate over whether or not it is a good move. 

“I don’t want to force change but it’s fair to say we’d like to see amalgamations if it makes sense.
 
“I think you will see with proposals we are putting forward more amalgamations driven by local communities and that’s really our preferred position.” 

Key used Auckland Council as an example of an amalgamation that has gone well.
 
The local body amalgamations are under a Bill currently before Parliament.