Brian Rudman: Rates inquiry pulls the wool over eyes of local body sheep

What a supine lot our mayors and councillors can be. The Government announces an independent inquiry to try to dampen the ratepayer rebellion over ballooning council taxes and what do our local leaders do? Tug their forelocks and join in a chorus of praise.

Haven't our civic leaders been around long enough to realise all the Government's done is dispatch the perennial question back into the "too hard" basket?

Local Government Minister Mark Burton was all hand-on-heart on Wednesday, declaring: "This is an important issue which is concerning central Government, local government and ratepayers. The Labour-led Government believes an independent inquiry is the best way to consider these issues."

How many inquiries does it need? Governments are always "reviewing" local government funding. Back in May 2000, for example, I was writing about that year's version. "Prime targets," I wrote, "are rate-exempt Government facilities such as hospitals and universities," adding, "local authorities, not unnaturally, are arguing that the Crown should pay rates like everyone else."

Fast track to August 2002 and a briefing paper to incoming Minister for Local Government Chris Carter from Local Government New Zealand, the sector's representative body. The report noted that exemption from rates for crown land "creates a major inequity in the current funding of local authorities" and "without some contribution in lieu of rates forgone these inequalities will continue".

It pointed out that Labour's 1999 and 2002 election manifestos made a commitment to "progressively work towards establishing a fairly assessed compensation regime for loss of rates on significant holdings of Government and other publicly owned land", and ended: "We call on you to deliver on your manifesto commitment."

The report further called for a review of local government funding, noting "this has been a long-standing grievance for local government and we would like a commitment to look at alternative funding sources ..." It demanded the review go back to first principles in searching for "the most appropriate ways" of funding local authorities in the 21st century.

To Mr Carter's credit, a review was set up, jointly conducted by bureaucrats from local and central Government. But after two years of study, they concluded that no real problem existed. There was, however, a concession that a small proportion of councils were having difficulties coping "using existing funding tools".

That was in August 2005. A follow-up report to find additional funding methods was due last December but it was nervously postponed by the officials until after the general election. With Labour back in office, a new deadline of March this year was announced. We're still waiting.

Surely it would make sense to see this report before embarking on yet another probe. If the local politicians can't get the result they're after from a review they've half-written themselves, then another "independent review" sounds like a very risky gamble.

They'd be better occupied trying to pin down the Government to honour its 1999 and 2002 election pledges regarding crown land, and any other proposals either the old or new review throws up.

While on the subject of reviews, what a waste of effort the Sport and Recreation New Zealand-led review of Auckland's sports stadium needs promises to be. Apparently Sparc has the region's eight territorial councils on side. Of course it does, until the final decisions interfere with the stadium-building dreams of some local government Poo-Bah.

Before a penny is spent, Sparc needs a binding commitment from councils and sporting bodies that (a) they will agree with whatever decisions are made and (b) they agree that funding for stadiums, existing and new, be on a regional basis.

If the guys from Sparc think I'm over-cynical, they should check out the Hillary Commission files for the June 1998 decision by Sir Wilson Whineray's investigative team into the best site for an indoor stadium in Auckland.

The commission had been asked to break a deadlock between Manukau City, which wanted it on the present TelstraClear Pacific Events Centre site, Auckland City, which wanted it at Quay Park, and the regional council, which wanted it to be at Mt Smart.

Sir Wilson came down strongly in favour of Quay Park, where the Vector Arena is now nearing completion. But did the two losers get in behind the winner? No way. Only the failure to find a backer halted one or possibly two rivals to the central city arena emerging elsewhere.