Agency gives council big tick
Porirua City Council has been given one of the highest credit ratings in the country, but don’t expect rates to go down.
In recently released figures, the council has been assigned a higher-thananticipated AA long-term rating and an A-1+ short-term rating by credit rating agency Standard and Poor’s.
The ratings put Porirua City Council alongside Hutt City and Wellington, and above Kapiti Coast District Council.
Porirua council chief executive Gary Simpson said the news showed the council was managing its finances extremely well, despite pressure to pay for the Transmission Gully link roads and other projects.
‘‘We anticipated an AA- rating, so it’s very pleasing to have a AA. It reflects an independent view of our financial position,’’ Simpson said.
‘‘Part of our financial strategy has been to manage debt at the lowest possible cost.’’
Simpson said the new rating would enable the council to fund on borrowings at a lower cost.
This will give the council an extra $600,000, which has been factored into the recently adopted annual plan.
However, Standard and Poor’s did mark Porirua City Council down on its operating deficit and under- performance on fees and charges.
Porirua mayor Nick Leggett said the new rating was about confidence.
‘‘What this tells us is that the council is well managed and we are making prudent decisions in terms of how we are managing the assets in our city.
‘‘It’s a confidence booster and we will take on board the suggestions from Standard and Poor’s as we develop our long-term plan very soon,’’ he said.
Leggett said rates would not go down, but people in Porirua should be assured that the level of service for rates was high.
‘‘At the end of the day, it’s important that people think they are getting proper service for what they pay. That’s what counts to me.
‘‘There will always be those out there who want to scare people about how their council is run, but Standard and Poor’s looks at a lot of different organisations and entities and it has said things look pretty good in Porirua.’’
He said Porirua would benefit from an interest rates reduction when the council went to the market to fund its capital programme.