KEY POINTS:
The Auckland City Council has given the go-ahead for water bills to rise 5.1 per cent before it has finished consulting ratepayers on the price rise.
In an extraordinary move, the council-owned water company, Metrowater, yesterday announced the increase from July.
Only on Wednesday, the council was telling ratepayers it was their last chance to send feedback on the water price rise in this year's budget.
Mayor John Banks and his deputy, David Hay, yesterday shrugged off the timing of the announcement and the message it sent to ratepayers about public consultation.
Mr Banks said the council had to maintain the integrity of the consultation process and if ratepayers wanted an alternative "we will have to listen".
Ratepayers are being consulted on more than a water price rise. They are being asked if the council should continue with the policy of taking "charitable payments" from Metrowater to hold down rates.
The policy is largely responsible for a 25.7 per cent rise in water bills in the past two years and the coming year.
Mr Banks told voters at last October's local body elections that the policy of "water price gouging" was unethical and had to stop and accused the then mayor, Dick Hubbard, of "stealing water profits".
In a perfect world the policy would have gone by lunchtime, but he had not been able to convince his Citizens & Ratepayers allies to overturn it.
An immediate end to the water policy would lead to substantial cuts in expenditure and/or borrowings and/or rates increases, he said.
Mr Hay, who says he opposes the water policy but, like Mr Banks, has voted to continue it, said the consultation process had not been turned into a sham by the announcement.
The council told Metrowater of its proposal for a 5.1 per cent price rise to enable the water company to advise customers well in advance of the rise.
He said from feedback so far there was no groundswell to abolish the water policy and increase rates. If ratepayers did want an end to the policy the implementation of the price rise would be cancelled.
An immediate end to the water policy would lead to a further rates increase of 6.6 per cent on top of the proposed 5.1 per cent increase, but that would be offset by an 11.9 per cent drop in water prices.
Metrowater chairman Ross Keenan said the council had not approved the company's statement of intent, which sets out the level of charitable payments to the council, but had approved the price rise.
Mr Keenan said the increase was mostly because of $14 million in higher costs from the region's water wholesaler, Watercare, to fund new investment to meet the needs of a growing population.
The income stream for the charitable payments was largely built into the previous two years' price rises.
