Mayors have a hidden agenda of asset-grabbing, says local-body reformer

The man who initiated the biggest overhaul of local government for a century says a spending binge and the chance of an asset-grab are driving the four Auckland big-city mayors who want to reduce the number of councils in the region.

"I sense this debate is being driven by mayors who have been caught with their hands in the ratepayers' pockets," said Dr Michael Bassett, who, as Minister of Local Government, pushed through the 1989 reforms that amalgamated some 30 local bodies into seven territorial councils and the Auckland Regional Council.

"Most of them have pushed rates up excessively without careful thought about what they are doing."

Dr Bassett said the mayors were claiming that the devil was in the structure of local government but he suspected it was a diversion from the real devil - their own councils' spending binges.

The people of Auckland were rightly angry about rates rises, and the Government was not enthusiastic about shelling out millions for Auckland's transport and other infrastructure problems.

As a result, the mayors were eyeing the $1.3 billion assets of Auckland Regional Holdings, which up until July 2004 were in Infrastructure Auckland.

Auckland Regional Holdings is a statutory entity which is responsible to the regional council for owning and managing the regional assets, which include the Ports of Auckland and portfolio investments.

Dr Bassett said the mayors had influence in Infrastructure Auckland and had got money for pet projects.

They did not like losing access to the money when a law change transferred its assets to ARC control and profits from the Ports of Auckland and investments went to the region.

In pushing for the ARC's disbanding, the mayors were thinking they could help themselves to an additional source of money to ease the road between now and their retirement.

Dr Bassett said it was a short-term measure.

"In the end, what would the people of Auckland get out of the change to a one-city structure? The answer is a rather depleted exchequer; not much to show for it in terms of efficiency.

"I'd need a powerful amount of convincing that there really is need for big change, radical change, and I suspect the motives of the people who are driving it."

Auckland Regional Holdings' 10-year plan promises to provide $1 billion of funds to the ARC.