Gore... We have a big financial problem
“We are still running a deficit, putting off essential maintenance and not saving enough for asset replacement, and we simply can no longer operate this way.”
Get each Southland Tribune edition sent to your email inbox.
ANALYSIS: It’s hard to dodge the bleak financial position Gore finds itself in. We might as well rip the band-aid off here and delve into it.
The Gore District has a population of just 13,000, with about 6000 rating units for the Gore District Council to tap into.
The formula doesn’t stack up. The revenue streams are limited, but Gore still has the costs many larger councils have.
Gore Mayor Ben Bell isn’t sugar-coating Gore’s financial situation saying they face some tough decisions about the Gore District’s future.
“I’ll be honest, last year’s (21%) rate increase was hard. Hard for us to front, but even harder for our community to absorb. And yet, sadly, that still isn’t enough,” Bell said.
“We are still running a deficit, putting off essential maintenance and not saving enough for asset replacement, and we simply can no longer operate this way.”
Bell said the draft 2025-2034 Long-Term Plan has laid out some hard facts.
The Gore council needs to invest $183m over the next nine years just to keep what Gore already has.
“Bridges are becoming unsafe, and our water networks are aging, these problems won’t solve themselves. We have some difficult conversations to have.”
To cover its current operating costs the Gore District Council would need to hike rates up by 24.25% for 2026.
That comes after the 21% increase for the current year.
Not surprisingly those at the Gore District Council have deemed that “unacceptable for our community”.
Gore is proposing to fund the District Plan costs, some IT system upgrades, and other operational expenses through debt.
This will slice the 2026 rate rise from 24.5% down to 9.9%.
However, increased debt hardly feels like a welcomed silver bullet to sort Gore’s long-term financial pickle.
Under that proposal, the Gore District Council’s debt level will increase from $70.7m in 2026 to $124.9m in 2034.
That’s hardly sustainable, is it?
Sections of the Gore public have become increasingly angry at proposed rate rises and the general state of the Gore District Council’s finances.
Elected members are becoming increasingly frustrated by the public angst that is bubbling within the community.
But Cr Andrew Fraser said there has been no wasteful spending or glorious perks thrown about, which the council has been accused of.
“If you are going to say to stop perks, please actually tell me what they are because I must have missed that email,” Cr Fraser said.
“We have had an upturn in staff abuse in this place, which is unacceptable. I wish I hadn’t read recent Facebook comments - people need to take a hard look at themselves.”
Councillors point out that 88% of the Gore District Council’s expenses are legislated. In short, they are costs handed down by Central Government.
Cr Bronwyn Reid said the Gore public need to realise the council only had just over 10% headroom to work with when trying to reduce its spending.
“There hasn’t been any willy-nilly spending,” she stressed.
Cr Neville Phillips said it was time to push back on Central Government on the back of the financial hurt that Gore - and Local Government in general - has found itself dealing with.
“We’ve got to start lobbying Central Government to stop telling us that we need to do this, and we need to do that.
“Wholey heck, where does it stop with Central Government. They are the ones that are killing Local Government and are killing our poor ratepayers financially.
“They are the ones handing down 88% of our expenditure,” Cr Phillips said.
Cr Paul McPhail said he and other councillors know how much financial hurt there is in the community.
“People are coming to me about businesses all the time, and there is a lot of hurt out there. There is no money, so we’ve got to be aware of every dollar we spend.
“If we have to sell the family jewels, or whatever we have to do, we have got to do our best.”
Cr Stewart McDonnell believed the Gore District Council should sell assets to ease pressure on the council and in turn its ratepayers.
“It is my preferred option to sell assets, underutilised or redundant. We are currently sitting on a lot of assets; the golf driving range, Matai Ridge, which we are trying to sell.
“But there are several other sections in Gore and Mataura that could go on the market,” McDonnell said.
“Selling assets has many beneficial effects for the council, it creates cash to repay this huge debt of $60m we are sitting on.
“Capital repayments also reduce the interest costs, the sale of land to residents allows us to charge rates which gives us income, the council has no maintenance costs and no staff time.”
Another option to reduce costs is to cut various Gore events, which may be another tough setback for some in the community who enjoy those events.
The council is currently in the midst of gathering feedback on what they believe the Gore District Council should do.
Deputy Mayor Keith Hovell said it was time the public had its say, but they needed meaningful feedback.
“This is the stage where the public needs to be making some positive contributions as to the way we operate.
“It is all well and good to say the council has too many staff, the council is spending too much money on cars and the rest of it.
“The bottom line though is it simply isn’t the fact.”
Cr Richard McPhail also urged the wider community to offer up some “positive” advice for the council.
“It’s time that the majority that has been silent actually come forward and start talking about what they want in this community.
“And the minority that is very, very loud actually look at being positive, or give us some proactive information around how we can proceed forward with this,” Cr Richard McPhail said.
The Gore District Council is seeking feedback on its proposed 2025-34 Long-term Plan which went out for consultation on Wednesday, April 2. Consultation closes at 5pm on May 2.
For a full list of consultation times and to read the document visit goredc.govt.nz/ltp25 before they are put up for adoption at a Council meeting scheduled for 24 June.
Last year when the 21.4% increase was announced, many rate payers called for the Council to go back and rework the budgets, but that did not happen. The council has been working on this LTP for 4 years, Councillors have had a number of workshops behind closed doors, we don't know how many. Nine months of this financial year had gone by and the silence of the proposed 24.5% rate increases until the end of March was unacceptable. It is clear most Councillors don't uphold the value of openness and transparency one of the hall marks of good local governance. They only have themselves to blame for the anger and division in the community.