QLDC rates collections from banks: 'This destroyed us'

by Peter Newport - Jun 26, 2024

More ratepayers are contacting Crux with details of severe financial problems caused by the Queenstown Lakes District Council taking overdue rates payments direct from personal bank accounts with no warnings or reminders.

This ratepayer, who does not wish to be named, says that the QLDC deducted an overdue rates payment direct from their personal bank account, with no notice, the day before their mortgage payment was due.

"As a result we defaulted on a payment and this destroyed us. To this day we are still making catch-up payments weekly .

"But the problem is that is my entire wage. My partners entire wage. Now we are behind on daycare by $1000. Power $600.

"My partners phone has been discontinued as a result of this blunder via council. 

"How do we pay for food and nappies let alone fuel to get to work?

"No words can describe the situation we are in, caused by the council."

The QLDC has declined to comment on this issue as it says it is council policy not to comment on individual cases.

The amount of overdue rates owed to the QLDC has increased to more than $7 million from $5.7 million just a year ago. Now the council is using ratepayers' banks to recover the money from household mortgages or personal bank accounts. 

A total of 644 households (totalling $2.1 million in unpaid rates) are more than a year overdue.

The non-payment problem has become so serious that the QLDC has contacted the personal banks of 594 properties looking to get their rates money through a "bank mortgage call".

This process allows the council to "recover as a debt from the first mortgage of a rating unit" under Section 62 of the Local Government (rating) Act of 2002.

A QLDC spokesperson told Crux: "There may also be differences in how each bank extracts payment funds from the customer. For instance, some may take it from the customer’s current account, some may add it to their mortgage."

The rapid increase in rates arrears comes at a time when the QLDC rates have risen dramatically. In the current year the average increase has been 14.2 percent but many properties have seen an actual increase much higher than that average.

Read more:

More ratepayer distress as council deducts payments from 594 personal accounts

Ratepayer forced to sell possessions as council deducts funds from personal account.

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