Prime Minister Christopher Luxon delivers his speech to the LGNZ conference in Wellington. Video / Mark Mitchell
THREE KEY FACTS
Prime Minister Christopher Luxon told the Local Government Conference that councils needed to focus on the “basics”
The Government is looking at options to cap rates increases for non-core spending
The Government will invite up to five regions to pitch for regional deals before the first one is finalised by next year.
Claire Trevett is the NZ Herald’s Political Editor, based at Parliament. She has worked for the NZ Herald since 2003 and in the Press Gallery since 2007.
OPINION
It’s not every day NZ First’s Shane Jones can rightly claim to be the “ray of sunshine” at anevent.
The outspoken minister is usually the one delivering the lambasting - as he did to gentailers and the Electricity Authority again this week as the power crisis deepened.
But at the Local Government NZ conference in Wellington, the Regional Development Minister was indeed the ray of sunshine - the good cop to the bad cops who had preceded him, Prime Minister Christopher Luxon and Local Government Minister Simeon Brown.
Governments tend to cop the blame for pretty much everything, so it’s little wonder they try to share it around when the opportunity presents itself.
This week delivered them some prime alternative scapegoats: in the form of the big banks and councils.
Watching the bank profits roll in while mortgage rates have been rising has not made them popular.
Cue Finance Minister Nicola Willis with a full tank of Shane Jones-esque rhetoric about the situation. Having prepared over recent weeks with her increasing muttering about unleashing KiwiBank as a “maverick” and “disruptor” she took to the Beehive Theatrette armed with fighting talk.
It was a “cosy oligopoly” and a “cosy pillow fight with profit margins coming first and everyday Kiwis coming second”. She vowed the Government “would not be cowed by the big banks”.
Illustration / Guy Body
Whether her plan to turn KiwiBank into the Incredible Hulk will work or not, she nonetheless won plaudits for sticking it to the banks – there aren’t many people around who are prepared to defend the big banks, other than the big banks themselves.
The next day saw Luxon take his turn – setting Simeon Brown up to be the disruptor and maverick in the local government sector.
Like the banks, councils are an easy target, especially as homeowners absorb rates increases.
The added salt in the wound for Luxon has been headlines about the extent to which those rates increases have eaten up National’s tax cuts, quite spoiling the effect of his string of social media memes boasting about those tax cuts.
The battleground was the shiny, newish Tākina Conference Centre. By happy coincidence (almost too happy) a major water leak had sprung just a block away from that conference centre the night before.
It set the scene nicely for Luxon to tell councils they had spent too much on nice, shiny things – such as conference centres - at the expense of the things they were expected to look after, such as water pipes and potholes.
Then came Brown with the double punch: a warning that if they spent on pretty things instead of “basics,” they would suffer a similar fate as beneficiaries who didn’t turn up to their job interviews and have the amount they could spend on luxuries capped.
The added incentive for councils to stop spending on things Brown considered fripperies came in the form of the regional deals the Government is proposing: longer-term deals between Government and councils to fund infrastructure and development. Those, Brown told them, would only be offered to councils which were focusing on “the basics.”
Luxon did not bother to sugarcoat it, because his audience was not the people in the room – it was the people outside the room, the ratepayers, a fair few of whom would have been cheering him on. He railed against the “the laundry list of distractions and experiments” councils spent money on.
It was very good politics.
Everybody has a grievance with a council; something they’re not doing well enough or something they think is a waste of money. Berms, sewage on beaches. Water pipes in Wellington. Overhanging trees. Potholes, rubbish and recycling. Cycle lanes replacing parking.
It got a purse-lipped reaction from many of the mayors and councillors in the building and little wonder. The nature of democracy means mayors and councillors have campaigned on specific promises and platforms – which could now be at risk of being vetoed by the Government as being over-indulgent.
Some felt (possibly quite rightly, in some cases) they had been wrongly maligned.
Finance Minister Nicola Willis and Commerce and Consumer Affairs Minister Andrew Bayly respond to the Commerce Commission’s banking market study. Photo / Mark Mitchell
Others railed that having the Government decide what councils could spend money on was a step too far. The Green Party described it as imposing “austerity” on the councils, saying it was “an assault on local democracy”.
The PM was called “rude” and “patronising.” Labour leader Chris Hipkins went a bit personal in an apparent reference to Luxon’s wealth, saying it was all well and good for people who could afford their own pools and books, but not so great if they couldn’t.
Luxon would not have given a fig. As far as he was concerned, in the court of public opinion it was a win for Luxon.
Councils should have seen it coming; Brown had been dropping spoiler alerts for a while, talking about his belief that councils should be embarking on the same line-by-line reviews of spending that the Government had, rather than just continuing with their predecessors’ projects and adding their own on top of them.
Brown’s point was that the Government has cut its spending – and cut taxes. Many households had cut their spending. Yet councils were raising rates instead.
Of course, the question of what amounts to a “nice to have” is a fairly subjective exercise.
Lo and behold, it did not take long for the adage about people in glass houses throwing stones to take its inevitable effect.
The very next day, the Government announced it was putting $750,000 from the Major Events Fund towards a street dance competition – and Auckland Council’s Tātaki Auckland Unlimited would chip in the other $750,000.
Was that in line with the “back to basics” theme? Finance Minister Nicola Willis reserved judgement. But the Government copped some friendly fire on it.
Act leader David Seymour – a longstanding critic of the Major Events Fund and its spending on interesting projects – was delighted with the stiff medicine handed out to councils and the regional deals - an Act proposal.
However, he told the NZ Herald he was “not impressed” by the dance festival funding.
“Back in my day, I danced for free on a show with no taxpayer funding and gave money to charity. Standards are clearly slipping.”
The dancing standards, on the other hand, will presumably be somewhat higher than Seymour’s Dancing with the Stars twerking.
