This is a story about the NPDC Debt. We’d heard the debt levels were pretty high - but even we were surprised.

We recently featured on the front page of the Daily News with closing comments about reducing debt at the NPDC.

We’ve also recently emailed you about the situation with Debt at the Waitaki Council in the South Island, where their debt has grown substantially in the last few years – in a similar way to our own region.

We enquired into the levels of Debt at the NPDC late last year and got a reply just in time for Xmas, which was not a good time to mention it to anyone.

We’d heard the debt levels were pretty high at the NPDC, but even we were surprised what level of Debt this council has managed to amass.

We thought maybe we should get local people together in a meeting to gently introduce the debt situation, but we can’t fit over 46,000 ratepayers in to one meeting. We think a lot of people who live in New Plymouth will want to know how much debt the NPDC has taken on, and is still planning to take on.

So, after a bit of debating, we decided we’d just put the information out there, and suggest how we all move forward knowing what is going on.

We expect people are going to be pretty unhappy with the debt situation, as we were, but we just remind you how important it is to think carefully about which of the current elected officials you vote for again.

And we ask you to help us by telling as many New Plymouth ratepayers and renters as possible what has been going on at the NPDC, so we as a community can bring about a change.

 

So what is the situation with the NPDC Debt ?

Do people remember New Plymouth has had this PIF fund (Perpetual Investment Fund).

• This was created in 2004 with about $260 million from the sale of the council’s share in Powerco. The purpose of the PIF was to offset how much ratepayers pay in rates and keep rates rises down.

• In 2017 the New Plymouth PIF Guardians Limited was set up as a Council Controlled Organisation.

• The PIF is currently valued at $376 million and it offset the total rates by $11.4 million in the 2023/2024 financial year.

• When this PIF Fund was set up in 2004 the NPDC debt levels were very low (as were most councils around the country). Our City had a $260 million buffer to protect ratepayers rates rises and to offset costs to run the city.

Fast forward to late 2024, bearing in mind Neil Holdom, our current Mayor, was voted in in 2016, and

What is the current level of Debt at the NPDC ?

• We now owe a whopping $364 Million Dollars !! – ($364,581,849.00 to be exact).

• We have borrowed slightly less than the value of our TOTAL PIF Fund.

We did some rough calculations –

• If interest rates to pay this back were 5% (and we know the current interest rates are higher than that)
• For the length of each loan owing late in 2024, to pay the interest and the loan itself back, we as a community now owe a staggering - $434 million +

• As ratepayers we thought we had the security of a large fund to protect our rates increases, yet now we find the value of that fund is less than the interest and principal amount owed with the current debt levels.

• And, these debt levels are set to rise considerably from the current Long Term Plan nice to haves plus capital projects.

We have around 46,500 ratepayers  (from residential, business and agribusiness).

All this current debt, many millions in forecasted debt still to come, AND, the NPDC still have regular shortfalls, and they still want to borrow more and more.

What on earth are the people running this city thinking ?

 

What is this debt doing to the NPDC Financial Ratings ?

A number of councils have had warnings written about their financial status according to Standard and Poor’s. This company assess the economic viability of organisations – including NZ Councils.  

New Plymouth is one of the 19 NZ Councils who has warnings that if certain financial situations were to occur then their rating will be FURTHER downgraded.

Standard & Poor’s Website heading for NPDC (as at April 2024):

• New Plymouth District Council 'AA+/A-1+' Ratings Affirmed;
• OUTLOOK NEGATIVE

(The S&P website link is attached at the bottom of this story for people who like the detail.)

 

Recently we wrote about the Sports Hub where 91% of people through the submission process said they were happy to do the Hub project - IF THERE WAS NO, OR A SMALL, INCREASE IN THEIR RATES.

How would the NPDC think a $434 Million+ Debt (interest and principal) would not increase people’s rates ?

It is important to remember a few of the current Councillors have been trying NOT to borrow every last cent available.

It’s important for people to understand which of the current councillors HAVE been voting to keep constantly borrowing more and more, and which ones HAVEN’T. We hope to help you with that as we get closer to the election.

So, we are guessing a whole lot of people in New Plymouth will not be happy reading this and seeing what debt has been created at our council. And, how much more debt is still to come.

 

What can we do ? What can you do ?

• Vote in 2025.
• Vote differently this time. Do not assume because you recognise the name of the candidate they have your best interests at heart.
• Encourage people who have given up - to vote.
• Understand what is going on and help others to understand what is going on.
• We are going to do our best to help you with different people to consider voting for.

 

The political system in NZ doesn’t leave a lot of room for the average everyday person to make a difference.

The only way we get to make a difference is WHEN WE VOTE.

So let’s get organised as a community and VOTE WELL this year.

Let’s make sure that in 2025 OUR VOTES COUNT.

P.S

To help others understand what is going on, and to help us get our name out there to reach more people, we’ve attached a flyer about us and how to follow us or join our e-mail list.

Please print this off, or take a photo of it, and share it with people.

If the boss is happy put it on the lunch table at work, show people at the gym, mention us at social gatherings and hobby groups, that type of thing.

A lot of people are talking about what they are not happy with at the NPDC, if you hear those conversations, tell people about us and the ways to support us and to keep informed.