Average rates hike put at $200

Len Brown sprang a surprise on councillors yesterday by announcing a special "transport levy" that equates to an extra 4 per cent on rates from July. Photo / Jason Oxenham

Mayor’s budget includes surprise transport levy that will see households pay an extra 4%

The average Auckland family will have to find an extra $200 a year from July to pay for Mayor Len Brown's latest budget plan.

Mr Brown sprang a surprise on councillors yesterday by announcing a special "transport levy" that equates to an extra 4 per cent on rates from July. The levy is $99 for households and $159 for businesses.

It is on top of an overall rates increase of 2.5 per cent, which is down from the previous figure of 3.5 per cent.

Details of the combined rates rise and levy were not distributed at yesterday's council meeting but Labour councillor Ross Clow calculated an average rates bill of $3000 would rise by $200.

He wondered why the council consulted residents on a rates rise of about 5 per cent and was now seeking an increase of 6.5 per cent - a jump of 25 per cent.

Residential rates are higher than business rates this year because of revaluations and a lowering of business rates.

Mr Brown has introduced the transport levy to replace a motorway toll or fuel tax, which the Government does not support, would require legislation and take years to put in place.

"I am basically delivering exactly what Aucklanders said they wanted. Sort transport out and we will pay for it," Mr Brown said.

The transport budget was slashed to fit within an original 2.5 per cent rates envelope and accommodate the $2.5 billion city rail link.

Mr Brown said the three-year "short-term" levy would fund about $500 million of extra transport projects, including a massive lift in cycling and fast-forward plans for a northwestern busway and busway to Orewa.

The latest budget plan received a mixed reaction, with Generation Zero spokesman Dr Sudhvir Singh calling it an opportunity to prioritise essential public transport, walking and cycling projects.

Chamber of Commerce chief Michael Barnett said the levy was pragmatic, but using ratepayers to fund it was a lazy way to raise money.

"The last thing Auckland needs is for the interim levy - really a targeted rate - to become a permanent fixture," he said.

Automobile Association spokesman Barney Irvine said the council needed a plan to deliver improvements and congestion relief and then look at how to fund it, not the other way round.

He said the starting point should be a transport accord between the council and the Government.

Transport Minister Simon Bridges said the Government did not believe the council had an optimal transport plan for the medium and long term.

"We are not going to be putting in place funding tools where we don't think there is a good plan and at the moment we just don't see that in terms of congestion and public transport," he said.

He would engage with Mr Brown over the next year or so to come up with a plan that would satisfy the Government.