Mayor welcomes report into local government finances

December 15th, 2015
[TDC press release]

Tasman Mayor Richard Kempthorne has welcomed a new report commissioned by Local Government New Zealand (LGNZ) that reveals councils are in good financial health.

Mr Kempthorne said the findings emphasised that local councils across New Zealand are being responsible with ratepayers' money.

"The results are an accurate reflection of the situation at Tasman District Council, where our focus on sound financial management has allowed us to reduce predicted debt levels and means we are now looking at being able to limit rate increases in 2016 to much less than we expected."

The report, "A snapshot of local government's financial health: a sector in good shape", prepared by the Local Government Funding Agency, reported that councils' finances are in good shape, with debt levels that fall below those estimated in 2012 Long Term Plans.

Credit ratings also continue to be strong, with more councils now rated by accredited rating agencies.

Tasman's Long Term Plan 2 would have seen net debt peak in 2022 at $293 million. Its updated Long Term Plan 2 reduced this to see net debt peak at $198 million in 2018-19. However, a strong financial performance over the past year means the Council is now forecasting an even lower 10-year debt peak of $186 million in 2018-19.

Tasman's average rate increase over the 10-year LTP period, of 2.62 per cent, is also much lower than the national average increase of 4.6 per cent.

The Council's long term credit rating issued by Standard and Poor's remains at AA-, with a stable outlook. LGNZ commissioned the high-level analysis after the release this year of councils' annual reports and publication of 2015-25 Long Term Plans.

Mr Kempthorne said ratepayers could take confidence from the report.

"It's helpful for an organisation outside of individual councils to do this kind of analysis to give ratepayers an impartial view of their representatives' financial management.

"We know we've been working hard and achieving the results the community asked of us, but a report like this adds weight to the information we present in our annual reports and plans."

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