Media Release

For immediate release Wednesday 20 March 2024

Kawerau District Council choose transitional option to prepare an annual plan for 2024-2025 and propose 15.1% rates increase

At an extra ordinary meeting today, Wednesday March 20, Council agreed to proceed with the transitional option of preparing an annual plan for the coming 2024-2025 year.

This means Kawerau will prepare a long-term plan over a nine-year term from 2025 to 2034.

Mayor Faylene Tunui believes the council’s decision to continue with the option of an enhanced annual plan provides the district with the lowest risk option after the new coalition government enacted the Water Services Acts Repeal Act 2024 in February. This legislative change will replace the former Three Waters’ reform legislation with what will be known as the Local Water Done Well legislation.

“This legislative change may have a significant impact on our council’s financial preparations for water services in the long term. Our council believes taking this approach ensures a prudent, low-risk approach for the district especially as the signal is that there are likely to be more legislative changes which could impact years 2026 onwards.”

“Having considered the options available, Kawerau District Council agreed to prepare an annual plan for the 2024-2025 year and then a nine-year long term plan for 2025-2034. This will ensure there is increased certainty for the planning and financial budgeting and impacts on levels of service arising out of the new water services’ legislation.”

It was a unanimous vote for the transitional option to proceed with:

• An annual plan 2024-2025
• An annual plan consultation document and engagement process with our Kawerau community
• A nine-year long term plan for the period of 2025-2034 completed in 2025
• The next long term plan would be completed in a two-year period for 2027-2037 to enable Kawerau to get back into the long term planning cycle

“As we have done in the past, we will consult and engage with the community about the 2024-2025 annual plan, major capital projects and levels of service which all impact on rates,” Mayor Tunui said.

At the extra ordinary meeting, Kawerau District Council also resolved to adopt the proposed budget for the coming year, which comprises an overall rates increase of 15.1 percent that maintains services at the current levels.

The increases for properties will vary depending on the individual value of residential, commercial and industrial properties. To smooth the rates increase, council proposed increasing the uniform annual general charge (UAGC) from $850 to $950 in 2024-2025. 

The significant drivers for the proposed 15.1 percent rates increase overall include:

• Increasing personnel costs due to inflationary costs and the tight labour market. Additional staff are budgeted for within governance support, engineering, policy planning, solid waste and finance administration.
• Depreciation expenditure of $4,345,100 for the coming year is an increase of $371,890 on last year. Council plans to prudently increase the levels of depreciation funded for strategic assets to 70 percent in 2024-2025. 
• Increasing finance costs on the loans to fund the drinking water pipe replacements of $217,500.
• Council plans to borrow another $2m in 2024-2025 to fund the next planned stage of the drinking water pipe replacements giving a total debt of $6m by June 2025.
• Higher inflationary pressures and resource availability driving higher operational costs across water maintenance, refuse cartage and disposal, insurance, civil defence costs, election expenses and electricity.
• Reduction of government subsidies to fund the spatial plan development costs contributes an additional $120,000 along with a reduction of interest income.

Council will adopt the draft consultation document on Wednesday, April 10, with community consultation starting on Friday April 12. This will include a series of stakeholder and public meetings. 

Mayor Tunui encourages people to have their say.

“We wish to ensure that people have the opportunity to ask questions, raise concerns and make suggestions about particular areas of service or operations.”

A hearing for submitters to talk to elected members will be held on Wednesday, May 22.

Submissions to the annual plan 2024-2025 will be open from Friday, April 12 until Tuesday, May 14, 2024.

The annual plan 2024-2025 will be adopted at a council meeting on Wednesday, June 26.

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For more information, please contact Kawerau District Council’s communication and engagement manager on 027 464 3785.