A Bill called the Local Government Amendment Bill No.2 has just been reported back from a select committee to Parliament. This Bill is of significance because it proposes to make it easier for local authorities to reorganise themselves by attacking each other and taking over services that the other provides.
Let’s have a look at the pros and cons of local government structure as it now appears. We have territorial councils that run a city or town and we have regional councils that govern entire regions and have regional responsibilities assigned to them. Before 1989 the regional councils did not exist, but there were a range of regional governance arrangements in place; for example there was Auckland Regional Authority, and closer to home there was Canterbury United Council. When local government was majorly reorganised nationwide the regionalisation arrangements became the norm across all areas, so that ARA became Auckland Regional Council, whilst CUC was essentially superseded by the Canterbury Regional Council. Many territorial councils were amalgamated together into larger bodies. This was done in a very piecemeal way rather than following common sense in a lot of cases, and this resulted in some unitary councils in places like Gisborne and Nelson-Malrborough for no good reason, and in some areas very small territorial councils like South Wairarapa District Council (total population 10,000), Kaikoura District Council (total population 3830), and three councils for the West Coast with an average around 10,000 in each of their districts.
So other words what is the point of having such small territorial councils and the reason is purely political. And what is the point of having unitary authorities and again it is political. When we see that there are clear benefits in the way regional councils and territorial councils are organised with clear responsibilities then the fact there are unitary authorities in some areas means that the regional and territorial functions are combined which creates a clear conflict of interest. This results in the regional function being minimised in most cases in those areas. To be able to look at the issue in this way we have to be able to understand that territorial forms of government are relatively weak and therefore prone to corruption and self interest. This weakness both comes from and contributes to a low standard of candidates for territorial council offices. Local governance is weak and corrupt because the wards that elect councillors are small and are therefore dominated by very local issues. The most local interest that any voter can have revolves around the house they live in. From there things scale up into their neighbourhood and its character. For political blocs to take control of a council they have to campaign across all the wards regardless of their character and therefore in most cases have to campaign on populist parochial platforms that will make the areas they represent more desirable, which usually involves spending lots of ratepayers’ funds. These platforms are in turn captured by interest groups that have the most time and money to spend on lobbying, generally the more prosperous areas in a city or town.
Both major political blocs recognise there are objectives that they can achieve through local government. National generally favours keeping councils locally focused taking as many responsibilities from them as possible or placing them under heavy government regulation. Examples: changing the Resource Management Act multiple times to push through development without public consultation,; mandating interference from NZTA in public transport tendering; forcing councils to sell their shareholdings in electricity retailing and public transport operations; mandating council corporatisation of commercial holdings, etc. National also supports councils becoming unitary so that a layer of bureaucracy is eliminated. Labour on the other hand supports councils that are involved in more things with more deveolved powers from central government, less regulation, more public consultation powers, more assets owned by central government etc. The problem is that both of these differing objectives fail to make local government more equitable. The populist character of local government campaigning and representation is not being addressed. This means that less populist causes such as core council functions and better services in areas such as water and public transport are not well served by local government.
National brought this Bill together to provide for new CCOs that would be owned by multiple Councils and organise infrastructure and services such as water and transport services into such organisations. Reorganisations would have to be under the supervision of an increased Local Government Commission with more members and powers than before. Labour has gutted key sections of the Bill, most notably the additional powers and duties assigned to the Local Government Commission and the sections changing the functions of CCOs. probably because the National Party model of a CCO would look more like the ones in Auckland, which follow a more corporate model of organisation that has less direct accountability to elected governance. Since the effect of National’s proposals was to regionalise local government more and the Labour proposals are to territorialise it more, the outcomes of changing this will be more negative for functions that are currently regionalised in local governance. This has come about because the Labour mayors of large cities which do not control functions such as public transport have been lobbying for decades to take over control of these functions regardless of the merit of any such proposals, which in most cases is non existent.
The problem with this Bill that Labour is pushing through (to serve their own political interests) is that the local government weakness is going to become more empowered by this law. A territorial council can instigate a reorganisation proposal out of naked self interest, usually from a political bloc who will claim they can do something better than another group of politicians. An example in Christchurch is the campaign by CCC to take over running local bus services from Ecan. There is no substantive basis for this claim except for naked self interest and political greed from CCC politicians, namely the Labour-Peoples Choice bloc. The much wider agenda is making it easier for territorial councils to seize power from their regional counterparts in every area possible. This means that CCC could also campaign to take over the responsibility for air quality, another area where they have proven particularly ineffective in the past to regulate due to a well funded vocal lobby of heating appliance and car owners who believe they have a right to pollute. Another example could be water quality. CCC is currently one of the biggest freshwater polluters in the city due to overflows from the wastewater system that it steadfastly refuses to fund the upgrade of. The reasons for pushing these measures through are not to improve services to ratepayers, but to advantage political blocs like Labour.
Once the Bill is passed we can expect to see the political blocs in various cities exploiting the very weak reorganisational mechanisms to push through various takeovers and the Government will stand by and do nothing as it is a political advantage to them to have territorial authorities that have more fingers in pies than ever. In public transport, because the existing provision of PT functions by CCC is already very weak, an improvement is unlikely.