Councils balk at 'cost-effective' law
OPINION: Councils believe they could potentially face more legal challenges thanks to changes to the Local Government Act.
The act was passed in Parliament last night, and rewrites the purpose of councils from focusing on the community's "social, economic, cultural and environmental" needs to to delivering "good-quality local infrastructure, public services and regulatory functions, in a way that is most cost-effective for households and businesses".
Local Government NZ president Lawrence Yule said the change of the definition could open councils up to legal challenges.
For example, he said ratepayers who felt that a council had not chosen the "most cost-effective" option for an infrastructure project would have the option of launching a judicial review.
"We raised with [Local Government Minister] David Carter the fact the changes could open up councils to legal challenges. But he has kept the definition."
Timaru Mayor Janie Annear agreed there was a potential threat of groups launching legal challenges against councils.
"This could lead to onerous costs, and the only people who really benefit are the lawyers," she said.
"The Government has suggested that they won't stop councils doing what they have been doing, and in a lot of cases, central government has partnered with local councils for various initiatives."
Mrs Annear said moves such as the Government partially funding the V8 Supercars event in Pukekohe with the Auckland Council showed how murky the definition of core business could be.
"Councils respond to the needs of the community, and if they don't like what they're doing, they have the chance of voting them out in the election," she said.
Mackenzie District Mayor Claire Barlow said the only debt it had accumulated was due to having to implement government initiatives such as new drinking water standards.
Waimate District Mayor John Coles said there were question marks over the change in definition of local government.
"Even my own council was divided over it," he said.
David Cochrane, special counsel for Simpson Grierson, said the term "most cost-effective" could potentially narrow councils' options.
"What could be the most 'cost-effective' solution for an infrastructure project in the short term might not be so in the long term, or vice versa," Mr Cochran said.
Other changes introduced in the reforms include allowing mayors more control over committee appointments, while elected councillors will be more able to set policies on staff numbers and remuneration.
Mr Carter said yesterday that the reforms would improve the efficiency and effectiveness of local government.
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