Local Government Debt Alert: One Hawke’s Bay Council’s Debt Triples in Just 12 Months
By Lions Roar News Local Democracy Desk
(Abstracted from the NZ Herald and Hawke’s Bay Today)
HAWKE’S BAY, NEW ZEALAND (December 31, 2025) – A sobering new report on local government finances has revealed a massive surge in borrowing across the Hawke’s Bay region. Most notably, Central Hawke’s Bay District Council (CHBDC) has seen its debt nearly triple in a single year, climbing to $110 million as it grapples with a “perfect storm” of infrastructure repairs and post-cyclone recovery costs.
The data, released as part of year-end financial reviews for 2025, highlights the extreme pressure on smaller ratepayer bases to fund essential water and roading projects.
📉 The “Perfect Storm”: Central Hawke’s Bay
Central Hawke’s Bay is currently facing some of the highest rates and debt servicing costs in the country. The council’s debt ballooned from approximately $38 million to $110 million in just one year.
Where is the money going?
- Three Waters Crisis: 85% of the total council debt is tied to water infrastructure. Six wastewater treatment plants require $112 million in urgent upgrades to meet compliance standards.
- Cyclone Legacy: The council is still managing a backlog of $129 million in roading repairs caused by Cyclone Gabrielle.
- Interest Hikes: Debt servicing costs for the council have jumped from 2.1% in 2021 to over 6.3% in late 2024 and 2025.
“We are facing years of underinvestment and increasing regulations,” said a council spokesperson. “It is a massive burden for a small community to carry alone.”
🏛️ Regional Comparison: Who Owes What?
While CHB struggles with rapid debt growth, other councils in the region are seeing varied financial health.
| Council | 2025 Debt Levels | Key Driver |
| Hastings District Council | $443 Million | Record $231m capital investment; 55% spent on cyclone recovery. |
| Napier City Council | ~$100 Million | Managed growth; focusing on “Local Water Done Well” transitions. |
| Central Hawke’s Bay | $110 Million | Tripled in a year; focused on failing water & road networks. |
| Wairoa District Council | High Arrears | Highest rates arrears in the region; residents struggling with $2.17m in unpaid bills. |
💸 Rates Arrears: A $9 Million Problem
Parallel to the debt crisis is the growing inability of residents to pay their rates. Across the four Hawke’s Bay councils, more than $9 million in rates went unpaid in the 2024/2025 financial year.
- Wairoa: Homeowners now owe double what they did a year ago, with total arrears reaching $2.17 million.
- Hastings: Despite the high debt, arrears actually dropped slightly as residents set up long-term payment plans following the 15% rate hike.
