Sam Warren: Taxpayers' Union Local Government Spokesperson speaks out as councils chase up unpaid rates through mortgages

Councils are taking millions of dollars of unpaid rates through people's mortgages. 

A little-known clause of the Local Government Act gives councils the power to force banks or finance companies to cover unpaid rates. 

It's used as a last resort after exhausting all other avenues to getting rates paid.

Taxpayers' Union Local Government Spokesperson, Sam Warren, says it wouldn't be needed as much if there was more sensible spending. 

"I want to see a lot more done by councils to rein in that spending and get rates down as low as possible so this doesn't happen." 

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Episode Transcript

Speaker 1 (00:00):
Did you know that councils can recover your unpaid rates
if you choose not to pay them by tapping into
your mortgage. It turns out millions of dollars in unpaid
council rates were taken directly from property owners mortgages last year.
Sam Warren is the local government spokesperson for the Taxpayers
Union and with US. Hey, Sam, can you hear me? Sam?

Speaker 2 (00:20):
I can can you hear me?

Speaker 1 (00:21):
Yeah? I can hear you. Now did you know that
they could do this?

Speaker 2 (00:24):
Look, it's a new piece of legislation to me, and
it's actually quite a little known. It's under the Local
Government Ratings Act where they can basically extract your mortgage
or you know, arrears. Sorry, your rates are reared through
your mortgage and not many people know that, but I
think All Can Council, for example, used it eight thousand
times last year alone. So there you go.

Speaker 1 (00:44):
How do you feel about it?

Speaker 2 (00:46):
Look, I mean a little split sometimes. I mean they
need their rates paid. But look, I think the biggest
issue for us is that it's happening in the first place.
Rates last year increased fifteen percent on average, you know,
up and down the country. I want to see a
lot more are done by counsels to reign in that
spending and get rates down as though as possible, so
this doesn't happen.

Speaker 1 (01:05):
Yeah, totally. I mean now, the thing is they say
it's a last resort. You know, they do everything else
before they can do this. How long do you know
how long they leave or what does last resort mean?
I mean, how long do they leave it before they
tapp into your mortgage?

Speaker 2 (01:18):
Yeah. Look, there's a number of letters, You'll be getting
a number of calls I'm thinking, and maybe even the
house visit. But look, this is a last result, thank goodness.
But you don't want to say far.

Speaker 1 (01:27):
I thought that they waited until you died or sold
your problem before they claimed it.

Speaker 2 (01:31):
No, not quite. There's a time Carriod. I think it's
within you know how many months. But basically, if they
can't get through to you and they find out you
owe a mortgage, they'll talk to your bank or a
mortgage provider and stack it on your rates, so you know,
and if you don't, obviously, they'll then pursue their own
debt collection and worse comes worse, they'll sell your house,
which happens rarely, but it does happen.

Speaker 1 (01:51):
Sam, I feel so conflicted about this because obviously I
pay my rates, so I want everybody to pay their rates.
But I also understand if somebody doesn't want to pay
their rates because suck. Right, there's just so much waste
there is this. Is this a problem? Is this a
modern day problem with the bloating of the public service,
or is this just something we will always have as
long as we have to, as long as we're compelled

(02:12):
to give our money to something like this.

Speaker 2 (02:15):
Look, I hope for the best. It's just that last year,
for example, that like I say, fifteen percent rate increases,
it's cited as one of the biggest contributions to the
cost of living. So we're really strong on something called
rates capping laws that would actually limit how high your
rates can be increased, and hopefully they would keep all
these areas down. Councils. You know, I spend a career
uncovering council waste all my goodness, it's endless. So look,

(02:38):
I really want to see.

Speaker 1 (02:39):
Strong we've come across.

Speaker 2 (02:41):
Oh, Heather, give me your worst. I'll give you a
recent one. How's that okay? It's was it a five
hundred and sixty thousand dollars Rainbow machine from Auckland Council.
It's a sculpture that you might have seen up and
down the place, but that's machine.

Speaker 1 (02:56):
What does it make rainbows?

Speaker 2 (02:57):
It refracts light. Yeah, it's an interactive art sculpture. But
like I say, it's I don't think that's core council spinning,
particularly when everyone's doing so rough at the moment. So
I really would like to see counsel really stick to
the basics. I'm talking about rubbish roads, pipes, that sort
of thing, and leave the artwork. I mean it's tough,
I know, but look it's just tough.

Speaker 1 (03:17):
It is tough. Sam, thank you, I appreciate it.

Speaker 2 (03:19):
Man.

Speaker 1 (03:19):
That's Sam Warren, local government spokesperson at the Taxpayers Union.
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