KEY POINTS:
According to a recent Herald DigiPoll survey, two out of three Auckland city voters back the push for one super council for the region.
The facts seem to support voter concern: Staff numbers in the various city councils over a six-year period have increased dramatically (in Manukau, for example, they have increased by 35 per cent). Salaries have also increased rapidly (for example, Manukau by 30 per cent). Clearly local government in Auckland is out of control. Is one super city the answer or will it take more to solve Auckland's problems?
I'm certainly in the corner of those who say it will take more. Replacing eight monopoly councils with one super monopoly council is on its own unlikely to work. Public monopolies, large or small, simply do not work.
So, what do we need to do?
* We need to confine local government to its core activities and responsibilities. The eight monopoly city councils in the Auckland region have all had aggressive social policy agendas over recent years at the expense of doing the basics well (roading, sewerage, transport, etc). Manukau, for example, spends as much out of rates on parks as it does on roads. To solve this problem, we need to get rid of the power of general competence.
* We need to understand that local government in Auckland is made up of eight monopoly councils, providing a series of monopoly services, managed by local government politicians and local body civil servants who lack the right incentives to perform. And in many cases, the necessary management experience and/or subject knowledge.
Reform must start at the political level. Local government politicians need to start the reform process by acknowledging that the current system of local body government has failed Auckland over the past 50 years.
It has failed to provide quality, cost-effective services and it has continued to spend money on flashy projects at the expense of infrastructure.
Local government currently operates in the following three areas: Non local government. Administrative. Local government. Restructuring each area requires a different approach.
Non local government activities do not require central planning management or control by local government politicians and should therefore be the responsibility of civil society. These areas include, for example, housing, education, health, and business initiatives.
The role of local government politicians should be to set the regulatory framework, not invest in private companies, for example Auckland Airport. Continued ownership of these shares will cost Auckland and Manukau at least $25 million a year at a time when Auckland's infrastructure deficit gets larger year by year.
What Auckland and Manukau are effectively doing is to borrow $400 to $500 million at 8 per cent to invest in an asset which returns 2 to 3 per cent cash in return. They are investing in an asset over which they have no input or control at a cost of $25 million a year and as a result, fail to provide the basic services all Aucklanders need, such as roads.
If the Government wants the shares in public ownership, let it buy them from Auckland and Manukau.
Administration: There is a need for input from local government into planning. But implementation should be contracted out to ensure innovation and management expertise of the private sector can be brought to bear and to reduce areas of monopoly supply (such as the issue of licences, collection of rates, electoral rolls, design and building of roads, park management, swimming pools, libraries, etc).
Politicians and departmental executives would concentrate on setting the outcome they require and ensure appropriate controls are in place, but leave the method of execution to those who win the various contracts. Contractors should be rewarded or penalised for over- or underperformance.
Local government areas need to be centrally directed and managed. They are the true areas of local government covering things like consents, environmental policy and democracy.
* Sir Roger Douglas is a former Labour Minister of Finance.
