News and Views

Farmers ready to take councils to task

Federated Farmers is gearing up to assist members and farmers with local authorities starting to reveal their Long Term Plans and budgets.

In the next two months, the Federation will make 68 submissions across the country and has prepared a policy guide to help its 24 provinces navigate council plans with particular focus on rates.

“Our members and farmers pay a lot of money in rates, which can be among their highest overheads. Councils set up their rating policies in their Long Term Plans, which can have a huge cash effect on farm businesses, and are consulted on every three years,” says Katie Milne, Federated Farmers National President.

2018 was especially significant as local government faces big challenges on funding infrastructure, both in response to major population growth and in some cases decline.

“Farmers are already paying big rates for essential items like the local road network, and are wondering what councils will come up with this time round.

“We want to make sure that any new projects are both justified, and funded appropriately. Ideally, we would also like to see councils disclosing the beneficiaries of their spending and making charges or rating proportionate to that benefit received,” says Katie.

The Federation had noticed a disturbing trend in regard to Long Term Plans that had already gone out for consultation.

“While its early days, with a dozen or so Long Term Plans out for consultation, we’re seeing some significant rate increases for farmers, such as the 23.5% increase on rural communities proposed by Manawatu District Council, and an overall rate increase of 12% for Bay of Plenty Regional Council ratepayers.”

Federated Farmers is also worried about the cost of the role local government plays outside of core services, such as tourism promotion and economic development.

“We’ve worked hard for a fairer system of funding these activities; supporting the Government’s Tourism Infrastructure Growth Fund in recent years – and that helps councils with tourism impacts.

“Take Queenstown Lakes District, where there are roughly 34 visitors for each local during peak periods. Under the current range of funding tools, councils can only rate the locals to fund the infrastructure those visitors are relying on.

“These councils need some assistance in meeting the costs of local infrastructure and services driven by the proportion of visitors, rather than just increasing the local rates bills annually.

“That’s not to say councils can’t do better themselves. I would like to see some change to council funding methods in districts like Ruapehu, where farmers feel they are propping up the tourism programme,” says Katie.

Katie believes 2018’s Long Term Plans will again highlight that council ratepayer bases are at their limits of affordability.

“The high cost of local government rates to farming will in particular increase the pressure already on government to revise how local government is funded, assisting ratepayers and councils with a share of GST revenue, to reduce the effect of property value rates.”

Source: Federated Farmers

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