Concern at DCC’s debt and rates rise

GREY Power Otago’s president says a dramatic escalation in the Dunedin City Council’s budgeted debt is horrifying and a proposed rates increase of 9.8% is appalling.

If city councillors do not make serious adjustments to the council’s planned programme, residents on fixed incomes would get the message they should ‘‘get the hell out of Dunedin’’, president Jo Millar said.

A few city councillors said yesterday they were worried about planned rates rises and projected debt, but most stayed quiet before 10year plan discussions which start in earnest today.

Councillors will have to decide whether they promote the full

budgeted programme — including $1.5 billion of capital spending that would force up debt by about $560 million by 2031 — or make cuts before proceeding with public consultation.

Economist Cameron Bagrie said councils were in an awkward position.

Investment in infrastructure was essential, but debt metrics had to be within reasonable bounds and councils had to make sure they got value out of their spending.

‘‘They’ve got huge deferred infrastructure liabilities that need addressing.’’

The Dunedin City Council has budgeted on a rates rise of 9.8% in the first year of the plan and then an average increase of 5.68% in years two to 10.

Debt could skyrocket

$869 million by 2031.

However, councillors would adjust the programme after public feedback.

Much of the budgeted capital spending is not new.

About $950.5 million is for what the council calls renewals, $487.5 million is for new capital and $77.4 million is for growth expenditure on water, wastewater and stormwater systems.

Mrs Millar did not want councillors to be under the impression residents would be relaxed about debt and rates figures she found startling.

Residents also faced price hikes from the council’s energy company Aurora, she pointed out.

Amid economic fallout from Covid19, the council should cut its cloth to suit, she said.

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