2013 Tauranga Election
The following information provided by John Robson for the 2013 Tauranga Election.
Tauranga: The City of Debt
Tauranga has a total debt of over $400million - or $10,000 per ratepayer.
Standard & Poors describes Tauranga as having a "very high debt burden", while Larry Mitchell, who produces the annual Local Government League Table, describes our debt as "ultra" high - both see the debt as unsustainable.
And don't believe the excuse that the debt is a product of growth - other, faster growing, local authorities do not have our debt levels.
At the moment, 25% of your rates goes straight to the banks to service the debt.
Now not all debt is bad - but good debt provides a return greater than the cost.
The classic example is a mortgage where the interest you pay means that you don't have to pay rent, you may get a capital gain, and you get security.
The issue with the Council debt is that too much of it is bad debt - it does not provide a return above its cost.
So we are paying interest but rather than getting 'wealthier', we are just getting more indebted.
And we are only surviving by cutting back - letting Matua flood, abandoning the people of Papamoa to tsunami, and breaking our promises to the people of Greerton.
And our Councillors - they are praying that interest rates stay at their current historical lows.
But interest rates are forecast to increase, and when they do, TCC will have no alternative but to significantly increase your rates and slash services.
We need to turn the debt situation round fast - and that process starts with understanding the cause of the problem - which can accurately be described as "poor leadership".
- To see how much debt we have, go to: http://www.tauranga.govt.nz/council-documents-reports/councils-lead-documents/annual-reports/annual-report-2012.aspx