20 p.c. rate rise saved by new tax

Press, Volume CXI, Issue 32639, 22 June 1971, Page 18

20 p.c. rate rise saved by new tax

If it had not been for the petroleum tax, the Christchurch City Council would have had to increase the amount it sought from the ratepayers by about 20 per cent, Cr H. P. Smith, the chairman of the finance committee, said last evening when he introduced the estimates.

“There is food for thought in this, particularly by those who opposed the tax or wanted it delayed,” he said. “Twenty per cent is a substantial increase, and the simple fact is that it has been avoided by the petroleum tax being available.”

Some persons had said there was undue haste in introducing the tax. If early action had not been taken only 5/6ths of the tax would have been available this year. The council’s wages and salaries bill was estimated at $3.463m out of a total expenditure on rating accounts of $6.361m, Cr Smith continued.

“So long as wages and salaries continue to rise rates must rise unless some other source of income is provided for local bodies or they are able to achieve a reduction in expenditure,” he said. “The petroleum tax does not appear to be a sufficiently large source of income to meet all rising costs.” In following the Public Service rates of pay the council paid its employees well, an din some cases very well, Cr Smith said. Local bodies could not expect to carry on watching costs mounting every year and crying for some source of additional revenue without taking a good look at their own work to see where costs could be reduced.

“This does not mean that local bodies should be thinking of dismissing staff, but I think we all have a duty to examine the activities of our

staff and ourselves to see whether some economies may not be effected.” DATA RECORDING

He wondered whether the “voluminous recording of data” was worth what it cost With a staff of 1067, excluding the M.E.D., 12 minutes extra productivity a day would equal 1067 man hours, which on a conservative estimate would represent $75,000 a year. Ruling rate surveys should be regarded as a maximum for council employees' remuneration. The Government received back by tax a not inconsiderate part of any wage or salary increases it gave or which resulted in other wage and salary increases. This situation, unhappily, did not apply to local bodies. There was never enough money to do all the things the council would like to do, and there would always be a problem of what part of the council’s revenue should go to purely functional items such as roadmaking, street maintenance and the like, and what parts should go to providing greater amenities for the people themselves at a cultural level. There would be an election in October, and it might be that some of those seeking office would be bold enough to suggest that rates were too high and that they had the means of reducing them, Cr Smith continued. If there was anyone present at the council who could offer a suggestion to reduce the rates substantially his comments would be welcomed.

Cr Smith emphasised that whatever increase there was in over-all rates it was not applicable to the council. The Fire Board’s rate was the

same as last year, even though it had a considerably greater levy, because it rated on the value of improvements and the levy was spread over a greater number of improvements.

Cr R. H. Stillwell would pay the council 1 cent more on his Selwyn Street home, but he would be paying the ad hoc bodies another $4.79.

The petroleum tax did not go far enough to help local bodies, Cr N. G. Pickering said. The Government should set up a local body finance corporation to make advances at a rate of interest to cover administration costs.

Cr Pickering reiterated his opposition to Mona Vale, which he said had shown a loss of $14,000 last year and for which a loss of $13,000 was budgeted this year. Unless something drastic happened Mona Vale was going to be an increasing drag on the ratepayers of the city and Riccarton Borough. Would Cr Pickering seriously think of selling Mona Vale? Cr B. J. Britten asked. Yes, unless it could be made payable or land could be sold off to help, Cr Pickering replied. OTHER PROJECTS To be logical, Cr Pickering should extend his argument to many-other projects which did not show a profit, and thus were a charge on the ratepayers, Cr E. B. E. Taylor said.

The petroleum tax did not go far enough, Cr R. M. Macfarlane said. There were still people getting the benefits of the city without making any contribution to rates. There must be some further means of reaching them for a contribution. Because of the set-up in Christchurch where drainage and transport were administered by ad hoc boards, those boards received no benefit from the petroleum tax, Cr Macfarlane said. In other centres where the special functions were administered by one body ratepayers there gained more from the tax.

“Bickering Pickering, we’ll call him,” Cr G. D. Hattaway said. “You have opposed practically everything that has been done in the last three years. You are opposing this beautiful gem of a park. We have estimates of $3.7m, but Cr Pickering spends practically all his time talking about $6500 we are proposing to spend on a park.” Some thought should be given by the Government to rates being a deductible item for income tax, Cr H. G. Hay said. Businesses received this, and also petroleum tax became an expense that was deductible. LIBRARY FUND

Cr Hay drew attention to a new item in the library estimates—s2ooo towards a rebuilding fund. This was a small beginning but it recognised that there was a need for a new library, and the amount could be of some help in the future when drawings were contemplated.

"Why Cr Pickering picks on this this piece of public reserve (Mona Vale) for his theme song year after year I don’t know,” Cr Smith said in his reply. “There would be just as much logic in his saying look at the money the Botanic Gardens costs, or how much it costs to keep the river banks mown.” The estimate for Mona Vale was .00185 per cent of the

council’s total expenditure, or 1 per cent of the reserve vote.