KEY POINTS:
Creating a super city for Auckland will cost $306 million and bring annual savings of $132 million, says the Employers and Manufacturers Association (Northern).
But chief executive Alasdair Thompson has ruled out any savings for ratepayers, saying lower administration costs of $132 million were "chicken feed" compared to a $16 billion infrastructure deficit hanging over the region.
Savings would come in the form of timely decisions from a single regional governance structure, Mr Thompson told the Royal Commission of Inquiry on Auckland Governance yesterday.
International consultancy firm Deloitte have done cost-benefit figures for the association, which were tabled at the commission yesterday.
The figures show it would take a team of 130 council staff and 80 consultants to create a super city over four years at a cost of $210m. About 700 of the 6300 staff in the present eight councils would lose their jobs, costing $69m in redundancies. Other costs, including new information technology, make up the $306m bill.
The biggest savings would come from buying services in bulk ($91m), fewer staff ($40m) and technology benefits ($1m).
Deloitte said the figures were for information purposes only and would not guarantee the accuracy of the indicative costs.
Commissioner David Shand, who chaired the Local Government Rates Inquiry, said there had been a lot of support for reforming local government in Auckland based on the presumption there would be savings.
"We are going to have to look carefully at this," he said.
The Auckland Regional Council and New Zealand Council for Infrastructure Development have also talked about annual savings of $160m and $200m respectively from a super city model.
Not all amalgamations have produced savings. A mega-city in Toronto in 1998 cost C$275 million and was predicted to bring savings of C$300 million a year. Eight years later a report found the reforms generated few, if any, savings.
Large numbers of ratepayers would be worse off under one proposal from Mr Thompson to abolish differential rates between business and residential ratepayers.
When the regional council tried this tack in 2003, household rates rose by up to 467 per cent, leading to the rates revolt.
Mr Thompson attacked the current councils for being dysfunctional, but urged the commission to give the job of setting up the super city to the chief executives and mayors of the eight councils.
Later, Mr Thompson agreed with a suggestion from commission chairman Peter Salmon, QC, there could be benefits of having an independent chairman overseeing any transition.
The association was one of several submitters yesterday to press for improvements at the local level. Others included the left-wing City Vision ticket, Hobson Community Board and the Green Party.
City Vision campaign manager Gwen Shaw said it was clear from the low voter turnout that people no longer saw local government as part of their lives. That could be improved by encouraging participation and decision-making at the lowest possible level, she said.
Hobson community board chairwoman Desley Simpson criticised the level of funding for community boards, saying her board's annual budget of $400,000 was insufficient when it cost $100,000 to build a toilet block in a local park.
Last Friday, the commission went to Great Barrier Island and heard a strong plea from about 70 of the 850 residents for a community board separate from Waiheke Island.
Said Jim Robertson: "We need you as commissioners to protect us as we are a special case."
