Frustration over FENZ review
A government review of the way Fire and Emergency New Zealand (FENZ) is funded has sparked frustration.
FENZ was formed in 2017, bringing together urban and rural fire services along with paid and volunteer firefighters. It is funded by a levy on property insurance.
However, that means of funding is under review, and one of the options for households and businesses is a change to a propertybased levy that could be collected by councils.
Tasman District mayor Tim King, who was one of two Local Government New Zealand representatives on a working party that considered the establishment of FENZ, described the review as ‘‘a classic example of the frustration of process’’.
‘‘FENZ was created with the support of local government specifically because that removed cost from local government, so local government support was largely predicated on the fact that it removed cost they were already funding – in our case, $400,000 a year of rural fire costs and administrating etc,’’ King told a Tasman District Council meeting in December.
The ‘‘sales pitch’’ from the Department of Internal Affairs at the time was that the new entity would be self-funding through the insurance levy, King said.
‘‘Local government said, ‘Yep, we’d like that – one thing taken off our plate and provided through a different funding model’. So to see it come back, and suggest going back to a property-based system collected by council, is far from ideal.’’
Given all the other challenges local government faced, ‘‘that is one we could really do without’’, the mayor said.
Council chief executive Janine Dowding said this week that if a property-based levy collected by councils was adopted, there were likely to be ‘‘significant technical issues’’ to resolve in order to carry out that work.
‘‘We would need to develop and deploy new software solutions to separate this billing, collection and debt recovery from property owners from the usual council rating activity,’’ Dowding said.
‘‘This will take time, and is likely to be expensive. There’ll also be extra staff costs associated in administering it.’’
The council was preparing a submission on the funding review, and would be ‘‘making the point that these costs should not be met by ratepayers’’, Dowding said.
Another potential source of funding outlined in the review consultation document is a ‘‘local authority contribution’’.
‘‘Local authorities could provide some support to reflect Fire and Emergency’s wider benefits for local communities,’’ the document says. ‘‘This could be an in-kind contribution (eg collecting the levy on Fire and Emergency’s behalf or providing the data if a property-based approach is preferred).’’
In a supplementary paper, prepared for the December council meeting, Dowding says ratepayers already fund the provision of water for firefighting capability. ‘‘That has a significant infrastructure cost, and its use is not charged to FENZ.’’
The Insurance Council of New Zealand wants change, saying the levy to fund FENZ is imposed on people who take out insurance only.
‘‘This is a grossly unfair tax that penalises people who try to do the right thing to protect their assets, lumping them with the cost of running FENZ while also supporting access to emergency services for those who choose not to insure,’’ council chief executive Tim Grafton said last year.
February 5 is the deadline for submissions on the review.