KEY POINTS:
Auckland City ratepayers will pay large water bills this year to help Mayor John Banks' council hold general rates to 5.1 per cent, the council's rate of inflation.
Mr Banks and Citizens & Ratepayers councillors are adding to the 19.6 per cent rise in water bills over the past two years with another hike of 5.1 per cent.
The combined increase of 25.7 per cent will allow the council to take a "charitable payment" of $21.8 million from the council-owned water company, Metrowater, for general council spending.
City Vision leader Richard Northey told yesterday's budget meeting that Mr Banks and C&R were using Metrowater as a "cash cow" to subsidise other council spending.
He unsuccessfully tried to cap water rates at the current level to phase out the charitable payments in about two years.
Instead, C&R, whose election policy was to keep water rates "as low as possible", voted to keep water rates at the council rate of inflation.
This would see charitable payments phased out over five years.
"We are committed to removing charitable payments, but in a way that balances the burden on ratepayers and water users," said C&R leader David Hay.
Mr Banks, who only a few months ago was telling voters the practice of "water price gouging" was unethical and had to stop, said stopping the charitable payments now would lead to a further rates rise of 6.6 per cent. That would be "very hurtful" at a difficult time for ratepayers.
But independent councillor Mark Donnelly said any rates rise would be offset by cheaper water rates, which would drop by 11.9 per cent if the payments were stopped immediately.
Mr Donnelly believed ratepayers would support higher rates to get rid of the "mess" of charitable payments.
Ratepayers will be consulted next month on an immediate end to the water policy, but without the support of Mr Banks and C&R.
Mr Banks' council has managed to reduce this year's forecast rates increase of 10.2 per cent to 5.1 per cent by taking a water payment and deferring a number of capital projects.
Household ratepayers face an overall 5.8 per cent rise in rates as the council continues a programme of reducing higher rates paid by businesses.
For most households, the rates increase will be $82. This is made up of a $23 increase in the fixed rubbish charge to $222 and a $59 increase in the uniform annual general charge to $154. This has the effect of a higher percentage increase for low- and medium-value properties and a smaller increase for high-value properties.
Despite cuts and deferrals, the council still plans to spend $405 million on capital works this year, including $36 million towards the Auckland Art Gallery revamp, $15 million developing parks, reserves and open space and $6.2 million on the "central connector" busway from Britomart to Newmarket.
City Vision councillors went on the warpath at the number of cuts to social programmes, including a $50,000 homeless action plan, $50,000 positive ageing plan and spending $67,000 to help migrants settle in Auckland City.
Mr Northey said the proposed cuts were mostly in the community services and arts and inappropriate for maintaining a good city.
