Stable credit rating lays groundwork for NPDC budget management

International credit rating agency S&P Global has reconfirmed NPDC’s AA/Stable/A-1+ credit rating, buoyed by the Perpetual Investment Fund (PIF) and the expectation that NPDC will continue prudent management of budgets and borrowing.​

In its annual report, the agency said the new Council elected in October last year was expected to maintain the financial direction, but with “a heightened focus on driving efficiencies and minimising property rates increases”.​

While NPDC’s debt ratio was expected to rise over the next two financial years, it was “mid-range” compared with other New Zealand councils and was expected to stabilise as capital investment, mainly spending on infrastructure, is pulled back.​

“The council's PIF, which holds NZ$430 million of financial assets as at April 31, 2026, provides a large liquidity buffer and additional flexibility that supports New Plymouth's credit profile,” said the report.​

“The stable rating outlook reflects our expectation that New Plymouth will prudently manage its budgetary performance and debt burden. Although debt will rise, the council's large investment fund will help sustain a very high level of liquidity.”​

The report also noted that while New Plymouth District has one of the country’s wealthier per-capita economies, “the mean household income is about $116,000 as of March 2025, about $19,000 lower than the national average” and more than 20 per cent of our 90,100 population was aged 65 or over, compared with under 17 per cent nationally.​

NPDC General Manger Finance and Planning John Scott said that given global uncertainty and economic challenges, maintaining the AA/Stable/A-1+ rating recognises NPDC’s strong fiscal management and efforts to contain spending.​

“We’re constantly running the ruler over our books to find efficiencies that will ease the burden on our ratepayers. While the S&P Global report rates our financial standing as exceptional, thanks in large part to the PIF, it’s also clear that we still have room to strengthen the management of our budgets, which will be a significant aspect of our next Long-term Plan, which will outline spending from 2027-2037,” said Mr Scott.​

The PIF is currently valued at $444.5 million at the end of April this year and will offset the total rates by $12.5 million this financial year.​

A copy of the report is available on our website.​

At a glance:

• NPDC manages assets, including the PIF, worth $4.4 billion and has an annual operating budget of about $262 million.​​
• NPDC created the PIF in 2004 with the $259.4 million proceeds from the sale of its shareholding in Powerco.​​​
• Since then, the PIF has released a total of $284 million to NPDC, which has mostly gone to offsetting rates.​​​
•  Under the New Plymouth District Council (Perpetual Investment Fund) Act 2023, the PIF is protected for future generations, and the benefits are ring-fenced to residents living in the current district boundary.​​​