It comes as no surprise that the Government has felt it necessary to propose rates capping. Rates rose steeply across the country, and our district was no exception. Our last three annual increases starting in 2023 tell the story: 11.6%, then 13.2%, then 7.7%, a cumulative rise of 36% in just three years. That was not sustainable, and ratepayers made rates the central issue of last year’s election. Those of us elected heard that message clearly
The turnaround came with the current 2026/27 Annual Plan, where we delivered an average rates increase of just 3.97%, making us one of only nine councils in the country to come in under 4% when the national average was 6.9%. Restraint is achievable, but it takes real discipline to sustain.
Here is the reality we are managing. Council looks after $2.4 billion in public assets. Roads, water pipes, parks and community buildings do not maintain themselves, and deferring any maintenance work only shifts a bigger bill onto future ratepayers. We maintain 505 kilometres of local roads, 200 of them unsealed. We welcome around two million visitors a year, and on peak summer days our population multiplies more than four times over from its 32,000 base. That surge strains our infrastructure and our staff, and impacts ratepayers’ pockets long after the visitors go home.
A rates cap will significantly restrain what Council can do, unless we do things differently. As we look ahead, core spending, existing borrowing and contractual commitments will absorb most of our rates revenue. In practice, Council will need to find equal savings before taking on any new project. We can no longer simply add to the list.
That means wherever possible shifting costs away from being ratepayer funded to being paid for by the user. This shifts more of the cost onto those who use our facilities but pay no rates here. Millions of visitors enjoy our roads, toilets, car parks and boat ramps, yet 28,000 ratepayers fund infrastructure sized for a population many times larger. User pays means visitors contributing fairly to the services they enjoy. It also means a culture where we treat every dollar Council spends as if it came from our own pocket, because it does.
User pays is one lever. Doing things at better scale is another, and how Council manages water is ready for that shift. Amalgamating water and wastewater services with neighbouring councils is not about gold plating or giving away local control. Communities keep a real say. It is about sharing scale, expertise and overheads to deliver reliable services at a lower cost than any of us could manage alone.
Keeping rates affordable matters. So does making sure we do not save money today by leaving far greater costs for our children and grandchildren to deal with tomorrow.
That is the balance Council must get right.
Tourism Levy Funding is Welcome – but Doesn’t Address the Full Issue
Mayor of Thames Coromandel District Council, Peter Revell, says it’s great to see recognition of the impact of high visitor numbers: direct funding to councils is something local government has sought for years.
But he says the current proposal risks disadvantaging visitor destinations with relatively few medium-to-large accommodation providers: Only data from accommodation providers with six units or more will be used to assess visitor bed-nights.
Peter Revell says the level of funding wouldn’t reflect the true number of international visitors to the district because it wouldn’t include stays in Air B n Bs.
“The funding is great news for places like Rotorua with lots of hotels, but Thames Coromandel is a different type of destination. It’s ironic because one of the reasons people like coming here is that we offer a laid-back lifestyle, not glitzy hotels”.
Being driving distance from cruise ship ports in Tauranga and Auckland means Thames Coromandel has a further disadvantage: Busloads of passengers flock to iconic spots like Cathedral Cove but return to the ship to sleep.
Thames Coromandel’s potential share of the levy isn’t listed in the funding policy document, but Deputy Mayor John Grant has run the figures. His analysis shows that, with a 1.36% share of the national pot, the district would get just $1.17 million in the first year (2027/28), and a total of $5.22 million over four years.
Peter Revell is asking National to consider a comprehensive plan to ensure equitable support for councils. Two practical changes would be to include stays with small commercial providers (like Book-a-Bach and Air B n B), and to bolster the pool by extending the levy to Australian visitors. He would also like to see recognition of the disproportionate effect of high tourist numbers on smaller centres.
“Per head of population, visitor infrastructure costs Thames-Coromandel ratepayers far more than it costs ratepayers in Auckland or Queenstown.”
