Claims that councillors have been delving into the bowels of the Tauranga City Council budgets to scrape together savings to reduce rates are being rubbished by Councillor Murray Guy.

Tauranga City Councillor Murray Guy says the real cause of savings to reduce the rates rise is through a deferment of debt repayments.

When the rates were struck it was said the reason the rates increase is 11.4 per cent instead of about 17 per cent is because of $33 million in savings on capital works.

It's a claim that is mischievous and misleading to the general public, says Murray.

'The council, to try and regain some credibility in the eyes of the ratepayer, reduced the rate demand significantly by one method and one method only,” says Murray.

'It took five minutes, the decision to not repay $6.2 million in debt – that's an actual cash outlay.

'We chose to reduce the rating requirement by $6.2 million; we just chose to defer those debt repayments.”

Every $900,000 represents about one per cent in rates, says Murray.

'Take off 6.2 million, divide by 0.9 and you have got essentially the reduced rating requirement from 17.6 down to about 11.4,” says Murray.

'That's where the reduced rating requirement came from.”

When the council collects less in rates, it has to reduce its planned expenditure, says Murray.

'A lot of that $33 million is work which is deferred, and not necessarily a rating expense, like the Waiari water supply – that sort of stuff, and we did it with the Southern Pipeline, we pushed it out.

'There were some very minor areas where elected members went through the budget taking out a swing or a swimming pool, but the majority of those millions were deferred capital works.

'The only significant saving in the rates requirement is the debt payments.

'That is really smoke and mirrors. In real terms it wasn't a saving – just pushed out from a tidal wave.”

Editor's Note: Murray's stance on the cause of the rates' reduced rise is a continuation of his views aired at the start of the year. Read the SunLive article dated January 27, 2011, here.