Operational spending funds the day-to-day expenses, including the cost of delivering the services provided by the Council, and is primarily funded through rates. It therefore has a direct impact on the level of rates we set.

Operational expenditure for 2025/26 is projected to be $17.5 million higher than forecasted in the LTP. This increase reflects factors such as higher inflation and other external cost pressures, including the proposed Crown-imposed levies and the need to address nationally driven District Plan changes.

While we have had some costs reduce, such as a $9.2 million reduction in insurance costs, other costs have increased since the LTP. These include:

• An additional $4.8 million to extend the use of the Burwood Landfill. However, this will be fully recovered from waste charges.

• An additional $4.1 million in costs for water services maintenance.

• An additional $2.1 million for proposed Water Services Authority and Commerce Commission levies relating to the regulation of water services.

• An additional $1.1 million to manage the large number of District Plan Changes the Council is required to address.

• An additional $75,000 for a feasibility assessment for a skate park upgrade, including a potential vert ramp at Washington Skatepark or an alternative venue, giving us the potential to host national or international skate events.

• An additional $1.1 million to meet higher digital licensing and contract costs over and above inflation.

• An additional $3.7 million to meet staff costs that cannot be covered by capital projects.

• An additional $8.0 million in staff salaries and wages costs due to pay equity, living wage and contract settlement adjustments, partially offset by increased revenue and other budget reductions.

• An additional $6.5 million to cover higher than expected inflation costs.

You can find more information about these proposed changes to our spending from page 8 in the Draft Annual Plan