Client:  Auckland Regional Council/Wellington Regional Council

Date:  December 2005

Author(s):  Dr Ganesh Nana, Mat Arcus

These notes have been prepared for Auckland Regional Council (ARC) and Wellington Regional Council (WRC). BERL has constructed forecasts for price level change adjustors for the ARC and WRC to use in their budget processes consistent with their Long-term Council Community Plans (LTCCP).

The approach is consistent with the approach we used in preparing forecasts of price level change adjustors for the Society of Local Government Managers (SOLGM), which was agreed after discussion with, and presentations to, SOLGM and the Office of the Auditor-General (OAG).

Our reports to SOLGM and OAG outlined the approach and methodology, and discussed alternative adjustors.

In this report, BERL has forecast one adjustor for each of the following 10 categories for the period to 2017, consistent with the current horizon for the LTCCPs.

• 1. Road transport PPI - input costs
• 2. Transport and storage PPI - input costs
• 3. Labour costs - all industries combined
• 4. Energy price index - electricity costs
• 5. Energy price index - diesel costs
• 6. Energy price index - commercial LPG
• 7. Energy price index - commercial natural gas
• 8. Energy price index - petrol (bulk)
• 9. Farm expenses index - fuel and oil
• 10. Capital expenditure - non residential building costs

BERL#4533