Kapiti Coast Council Infrastructure Services Group Manager Sean Mallon says that his council is able to charge a 10% late payment penalty on water meter charges (Kapiti News 8/10/14). I challenge him to provide the legislative authority under which this decision was made.
It is my understanding Councils have statutory authority granted by the Rating Act to charge 10% late payment penalties on unpaid rates. The Council has to resolve every year how these penalties will be applied, but the authority is from legislation not the Council itself.
As the Council has decided to remove a uniform water charge from rates and instead charge each individual property on a user pays basis, this no longer falls under the ambit of the Rating Act. While the Local Government Act allows Councils to restrict water supply when relevant by-laws have been breached, it gives no authorisation to charge late payment penalties. As such it would appear to be wrong for Mr Mallon to claim that because water was previously charged as part of general rates, the statutory authority to charge late payment penalties remain.
In view of the Council's recent bad record in decision making, I have my suspicions that despite Mr Mallon's assurances, that the Council have not got it right this time regarding the 10% water charge penalty.