Editorial: Council renovation

The eight-point programme announced this week by the Minister of Local Government, Nick Smith, to reform the operations of New Zealand's 78 local councils is a bold one. Among other things, it aims to redefine the purpose of local government, to give more power to mayors, to make mayors and councillors more directly responsibility for staff numbers and salaries and to make it easier for councils to amalgamate. On the face of it, much of this makes sense.

A proposal to develop a framework for central and local government regulatory roles, for instance, has the potential to deal with one of the principal bones of contention between local bodies and central government. But whether this will greatly curb rate rises, as Smith intends it to do, without jeopardising the services ratepayers want is another matter.

The Government's programme will be introduced in two parts. The first, more far-reaching part, is intended to be enacted by September. One of its measures will reverse the requirement of the Local Government Act of 2002 that councils should strive to achieve social, economic, cultural and environmental wellbeing. In future, councils will be required to provide good-quality local infrastructure, public services and regulatory functions at the least possible cost to households and business.

This refocusing is commendable, but it may not amount to the 180-degree turn that the Mayor of Christchurch, Bob Parker, believes it to be. Its greatest effect may be to lower what Smith calls "false expectations" of what local bodies should be expected to do. But for all Smith's suggestion that councils have over-reached themselves under the present legislation, there is little evidence that they have spent large amounts of time or money in doing so.

It is true, as Smith says, that local government spending as a proportion of the country's total output grew (from 3.1 per cent to 4 per cent) between 2002 and 2011, but part of that can be attributed to slowing output growth and part to central government requiring more of local bodies. Another comparison given by Local Government New Zealand, taking total local authority expenditure as a percentage of total Crown expenditure, shows that the local body share has been relatively steady over the last few years and actually fell between 2010 and last year.

The proposal to give greater powers to mayors will, if nothing else, focus voters' attention on the nature and calibre of the person they elect to the position. At present, mayors are figureheads, with little real power over other councillors. Smith's proposal is to give mayors the power to appoint their deputies and committee chairpersons and to give them explicit leadership over the development of plans, policies and budgets. Mayors will have real patronage and authority, something voters will have to keep in mind when making their choices at election time.

The councils with the greatest problems with growing debt and outsized rates increases, however, are generally smaller ones, many of which should merge with a neighbour. It is here Smith's proposals may have their greatest impact. The idea is to greatly simplify the process by which councils might amalgamate. The last amalgamation was Banks Peninsula with Christchurch in 2005 and that took years. Combining small, inefficient councils is where the greatest gains are likely to be made.

The Press