Speech: Local Government

Annette King  |  Friday, July 27, 2012 - 13:41

Speech to the Local Government New Zealand Conference
Queenstown, 17 July 2012

Thank you for inviting me to speak to you all today.

We believe no political system is complete and democratic without a system of local government.

It is the way to provide the opportunity for local people to make local decisions in their local communities.

We are committed to the right of communities to have a say on major decisions affecting them.

Our vision is to ensure local government is responsive and accountable to local communities; affordable for its residents and ratepayers and effective in dealing with local issues.

We are also committed to a close and collaborative working relationship with local government.

So when the Prime Minister said to you yesterday the relationship the government has with you is important – we say ditto.

No disagreement.  We do have a disagreement on the nature of that relationship.

I’m pleased to see Mr Key continues with an annual central / local government forum at Premier House, something Helen Clark started, usually twice a year.

She treated these meetings as very important events, certainly wasn’t an exercise in sitting around singing Kum by Yar!

Heaven help any Minister who was not on top of every issue affecting local government in their portfolio responsibility.

Our aim in government was to build, strengthen and improve the relationship – by and large we achieved that aim.

There is always room to improve – but the basis for improvement has to come out of trust, performance and mutual respect.

We know the significant impact local government has on the daily lives of New Zealanders – far more immediate than many decisions central government makes.  Local Government has an important role in economic and social well-being of so many people.

As a local constituency MP of 25 years’ experience much of my work arises out of local government issues – noisy neighbours, stray dogs, pot holes and graffiti and so on.

How local government performs therefore is very important providing best value for ratepayers is a goal worth pursuing.

Labour has no problem with change that improves the lives of local people – we are a reformist party.

But the most recent changes proposed by the government reflect a Party of Managers.

“Better Local Government” reforms are about more government management and control rather than developing a full partnership in local, regional and national development.

The Government appears to have forgotten the first lesson of reform.

First, get the evidence and research to back up your argument. – My old dad has a saying, “Measure twice – cut once.”

In fact, the Government manufactured a crisis in Local Government to justify rushed and ill-considered change. The ‘facts’ put forward by the previous Minister were based on myths and as Rod Oram writing in the Sunday Star Times recently said “on gross distortions of the truth and a handful of egregious examples”

For months before the release of the policy document Local Government was portrayed as hitting the financial wall due to profligacy, lack of financial prudence, out of control rate rises, spiralling debt and confusion arising out of Labour’s Local Government Act 2002.

The public were told Local Government had failed to reign in debt now at record levels.

Salary costs were escalating because of the 2002 Act.

Rates had increased at more than double the rate of inflation.

Local Government as a proportion of GDP had reached 4% since the passage of the 2002 Act

Councils were engaging in a range of dubious activities including setting NCEA passes, buying farms, running schools and hospitals.

The evidence does not support those claims.

Local Government New Zealand helped by putting out a paper on key facts disputing rate rises, GDP figures and debt profile.

The Minister’s own department, Department of Internal Affairs in a briefing to him contradicted some of the claims. For example:

Councils now spend less on employees than any time in 20 years.

That higher debt levels and interest payments tend to be found in Councils experiencing rapid population growth. Debt against long term infrastructure.

And as for non-core Activities, according to Statistics NZ the amount Local Government spends is actually declining not increasing.

In my view, Local Government has been set up as the STRAWMAN.

No one is opposed to meaningful change that improves the performance of Local Government and provides better and more sustainable services to citizens.

But even the Government’s own officials doubt the proposals that are now before Parliament.

I suggest you read the Regulatory Impact Statement provided by Department of Internal Affairs for the “Better Local Government” reforms.

Among other things they said:

These are the risks as to whether the proposals will work.
There is limited evidence to inform the development of the proposals.
The timeframe within which proposals were developed has restricted the ability to assess other options.
The assumptions have not or only partially been tested.
There is no clear quantative evidence to suggest Local Government Act 2002 has resulted in a proliferation of new activities or that Local Government is undertaking a wider group of functions.
And significantly, the removal of the 4 well beings from Local Government Act is “likely to have a symbolic affect and should not affect Council business as usual.”

In other words, it is a window dressing of change for political purposes.

Of the eight point proposal put forward by the Government I have no difficulty in the four that make up what the Prime Minister told you yesterday was the 2nd phase of 2-phase process.

But the Government has got the whole process about face!

Why not collect the evidence, examine the research, do the consultation, seek input before pushing forward with phase one legislation.

The Government would be using Parliamentary time that may have to be duplicated in the future if any changes arise out of the myriad of reviews, taskforces, enquiries that make up phase two.

Why not receive findings from Local Government efficiency taskforce due to report end of October, first?

Why not wait for the Productivity Commissions Review of Functions and Regulatory Performance due in April 2013?

Why not wait for the Expert Advisory Group looking at infrastructure due in early 2013?

Why not implement the Auditor – General’s five recommendations for Improving Reporting of Performance Information for Local Government before passing legislation?

And if there is confusion over what Local Government can be involved in and impractical expectations then to a large measure it comes down to the Government itself.

The Prime Minister said the role of local government will be “extremely broad.” The Minister said it would be narrow and only involve what only Councils can do.

For every function the Minister ruled out, the Prime Minister ruled back in.

Boat races
Tourism
Economic Development
Fireworks
V8 Car Races, the list goes on.
Labour will oppose the bill unless changes are made.

The 4 – Wellbeing’s are a bottom line for Labour. There is no reason to change them to a narrower focus.

There is a large body of evidence that shows that internationally competitive cities and regions are those that promote wellbeing, that plan long term, taking into account it’s economic, social culture and environment wellbeing of their citizens.

The international trend in Local Government reform recognises the need for long term planning integrated with land use and other resource planning.

The 2002 Act reflects that trend. I predict the proposed changes will become a legal nightmare as Councils attempt to justify particular projects their rate payers want.

And does Local Government want to go cap in hand to ask the Government every time they have a proposal that may or may not meet ill-defined criteria?

Labour is not opposed to amalgamation of councils or the establishment of unitary authorities.

In fact, we support forward looking consolidation which produces good governance and is capable of adapting to meet the needs as they evolve over the long term.

But we have set out a series of principles that need to be part of any consideration for amalgamation.

• Must be clear and robust rational for amalgamation – first question to be asked is will it improve Local Government performance for the rate payer and residents?
• Needs to be based on realistic evidence-based assessment not on inflexible or ideological positions decided at the outset.
• There needs to be consideration of all options available and what each would achieve.
• Must be meaningful consultation with all affected parties at the start of the process of change plus trust and good faith in negotiations.
• New form of governance should be treated as a fresh start – rather than a takeover by one party.
• Realistic timetable – not rushed which can lead to flawed change.
• Should respect and accommodate diversity.
• No forced amalgamations and any amalgamation subject to referendum of affected citizens.

 

There is considerable interest in the outcome of the Auckland Super City amalgamation.

I’m told Auckland representatives provided feedback yesterday on how things were progressing. It is a great opportunity for the rest of NZ to benefit from the lessons learnt, before we proceed at pace to follow.

The Select Committee will start to hear submissions on the Local Government bill in few weeks. I look forward to hearing from many of you here.

The election in 2014 will see Labour present a comprehensive Local Government policy.

I’m in the early stages of development but my aim is to involve a wide range of people with experience, both within and outside of the party.

It’s time we looked at recommendations from the Rates Review of 2007, particularly better revenue sharing between Central and Local Government.

And partnership and local democracy will be fundamental components of our policy.

I hope to visit many Councils over the next 18 months to hear your views.

Thank you.