LGNZ applauds increased borrowing capacity for some councils

After years of pushing for changes to the Local Government Funding Agency’s (LGFA) borrowing limits, LGNZ is praising the announcement of increased borrowing capacity for high-growth councils.

This change is one of the funding and financing tools that councils have been calling for, with LGNZ today releasing a funding and financing toolkit that sets out these tools in detail.

LGNZ President Sam Broughton says the increased borrowing capacity is an example of how current funding levers can be changed to make it easier and more efficient for councils to deliver.

“We know that not every funding tool works for all councils equally. This borrowing capacity move gives metros and high-growth councils like Hamilton and Tauranga greater flexibility to deliver the infrastructure that communities need.

“We are also wanting the Government to look at other tools, such as GST sharing on residential new builds, so councils have a range of levers to pull that suit their local context,” says Sam Broughton.

LGNZ Metro sector chair and Hamilton City Mayor Paula Southgate says the infrastructure that councils make decisions on now will benefit many future generations.

“Having the ability to spread the costs over the lifetime of the infrastructure gives us greater ability to invest in the roads, bridges and other core infrastructure that our cities and regions need to keep the country moving,” says Mayor Paula Southgate.

“The increased headroom offers some councils greater flexibility in how they structure debt to reduce the impact on ratepayers."