International credit-rating agency Standard & Poor’s has reaffirmed Hutt City Council’s AA long-term credit rating with a stable outlook. An AA credit rating reduces the cost of borrowings by up to 0.30% compared to other borrowers.
Standard & Poor’s report to Council states it has a supportive institutional framework, experienced management team, and strong economic profile which underpin creditworthiness.
“Council adopts budgets and long-term plans without delay, and it remains focused on being financially disciplined in its approach to borrowing and insurance policies. Standard and Poor’s considers Council’s debt and liquidity policies to be prudent,” the Agency found.
“Council’s large capital programme reflects its decision to address previous backlogs and underspending on essential infrastructure.
“The large capital programme will lead to rising debt levels. Decisions to increase property rates and contributions from developers support financial sustainability and indicates the Council is aware of the financial pressures its large capital programme will bring.”
Lower Hutt Mayor, Campbell Barry says the AA rating reflects Council’s strong combination of good financial management and getting the basics right.
“Our goal is to create a city that thrives and investing in our core infrastructure and getting the basics right is a critical part of that,” the Mayor said.
“This credit rating demonstrates that it is possible to undertake an ambitious infrastructure programme while remaining fiscally sustainable.”
Council Chief Executive, Jo Miller says the rating is an endorsement of Council’s strong financial management and strategy.
“Having our top AA rating reaffirmed by an international rating agency reinforces the financial approach we have taken – which is ultimately allowing us to make progress on our city’s most significant challenges, in a measured and financially responsible way,” she said.
“It is also a reflection of the significant focus we have put on financial sustainability, both in our Long Term Plan and in our day-to-day management practices.
“Our financial strategy will ensure we achieve a balanced budget within the next 10 years, and we have set out the pathway to do this in our Annual Plan 2022-23.”
Standard and Poor’s full report is available to read on Council’s website here.