Belt-tightening will follow rates rises
There’s a new annual ritual in my money life: Trimming the household budget to absorb another grotesque Auckland Council rates rise.
For those who read this column around the rest of the country, the spectacle of Auckland Council’s rates rapacity must make them shake their heads in disbelief, though it is not the only council shocking its householders with rates hikes.
Pity those poor Aucklanders. Expensive housing, endless gridlock and last week an average 9.9 per cent residential rates rise.
And on top of it all, they voted in their increasingly angry-sounding mayor on promises of reasonable rates rises.
Many householders, like me (especially those of us who doubt our city’s CBD-focused strategy), would consider a 9.9 per cent rates rise as having dodged a bullet. The average in my ward is over 14 per cent.
Aucklanders’ rates rises are on top of big rises last year and the year before that.
Last year, I was so angry, I rebelled. I didn’t go on a rates strike as that would have been illegal. Instead, I gave up snacking. I reckoned I was blowing $10 to $15 a week on snacks. So I stopped.
Bad luck to the dairy near work but I was determined that the council wasn’t going to slow the rate at which I prospered.
I’ve got a bigger task ahead of me this year. In a few weeks, my next rates rise notice will come. It won’t be less than $500. Obviously, people’s wages can’t keep up with rises like that.
The council is literally stripping out a greater and greater proportion of household incomes each year. So what will I give up this year? Beer? Unrealistic, I’m afraid, though I reckon I spend a grand or so on beer a year. It’s easily done. A six-pack of Macs each week will set you back about $750 at supermarket prices on its own.
We could cut back on the insurance. It’s time I shopped around to see if I can trim that bill.
Books. That’s a good place to save. I like to support my local bookshop, Time Out in Mt Eden. I may have to curtail that. I don’t drink cafe coffee so no savings to be made there. I cycle to work and our household only runs one car so there are no more savings to be had on that front.
We could stop making voluntary school donations. Realistically, even though I know others who can afford to pay don’t, we still will.
All over the city households will have to trim. Those squeaking by on low incomes and NZ Super will struggle.
Some people will cut their KiwiSaver contributions, some their snacking. Some will eat out less, some buy more supermarket home branded food. Some will make their clothes last longer, some their shoes. Some will turn down the heating, some skip the dentist for another year.
Auckland Council’s 10-year plan says its rates take is going to increase from $1.57 billion in 2015/16 to $2.38b in 2024/25. The march of the rates rises will continue, though exactly what next year’s rates rises will be will not be known until mid-July.