Hospital hit by an ‘exorbitant’ rates hike
One of the country’s largest private hospitals says its future operation could be severely impacted if a plan to hike its rates by 676 per cent goes through.
Braemar Hospital faces a $355,400 rates hike over five years, according to the Hamilton City Council’s proposed long-term plan, chief executive Paul Bennett said.
Compounding the impact of a city-wide rates increase is the council’s proposal to speed up the transition from a land value to capital value rating system.
‘‘The rates increase the council is proposing can’t be justified and there’s no way anyone can budget for that sort of increase,’’ Bennett said.
‘‘What it means for us is that we will have to forgo buying something in the future, whether it’s medical equipment or a building project.’’
Braemar’s annual rates bill was $52,550 in 2014/15 and it is forecast to lift to $407,986 by 2019/20 - a hike of 676 per cent.
Braemar Hospital is on the corner of Kahikatea Dr and Ohaupo Rd and carries out 10,000 surgical and medical procedures a year.
The hospital is operated by the Braemar Hospital Charitable Trust. All surpluses are invested back in to the hospital or used for charitable works.
Bennett said the trust will struggle to absorb the increased rates bill due to the fact a lot of the hospital’s procedures were carried out on fixed fee basis.
‘‘We don’t have the ability to pass on the extra costs to our patients and nor should we be expected to,’’ he said.
‘‘We get a number of patients who come from the Hamilton region anyway. If we did pass on the cost to patients that would mean they were paying for what is a council problem.’’
Council staff have said driving the need for the major rates hike is higher-than-expected population growth, increasing council compliance costs, and an underinvestment in council assets during the past six years.
The council has proposed two years of 9.5 per cent - on average - increases. Bennett urged the council to cap increases and decreases to avoid extreme rate hikes.
‘‘If the council is proposing a rates increase for us of such magnitude then there must be a whole bunch of rates decreases that they are proposing as well if it all adds up to an average rate increase of 9.5 per cent. Rates increases need to be fair and equitable to all ratepayers and a rates increase of 676 per cent in five years is not acceptable, it’s exorbitant.’’