An independent panel says the relationship between central and local government is not serving the best interests of New Zealanders. Photo / WellingtonNZ
An independent panel says the relationship between central and local government is not serving the best interests of New Zealanders. Photo / WellingtonNZ
A massive funding transfer from central to local government and the possibility of merging councils or their services are recommended as part of a major overhaul of local government.
The independent Future of Local Government panel says that any amalgamation of the 78 authorities should be chosen by those authorities but panel chairman Jim Palmer added that if councils cannot agree, “decisions would need to be made on their behalf”.
The panel’s final report He piki tūranga, he piki kōtuku, is not Government policy, nor is the Government expected to respond before the October election.
But the panel stressed the need for reform, saying the current model is not serving New Zealanders because of a poor relationship between central and local government, a local government model that was no longer fit for purpose, and a lack of funding despite “peak rates”.
“Decisions by successive governments have marginalised local government and left it in a precarious position in terms of focus, resourcing and viability,” the report said. “We don’t see either the mature relationship or the mechanisms and systems necessary to deal with these challenges between central and local government.”
Palmer said councils were doing great work but “are hampered by a lack of funding and day-to-day pressures”.
“Local government and communities must be empowered to build local solutions for national-level problems, with vital collaboration and funding from central government.”
The panel’s 17 recommendations include much more money for local authorities, including an intergenerational fund for climate change adaptation, an annual transfer from central government starting at $1 billion, all GST paid on rates to go to local government, and for central government to pay rates on its properties.
Cabinet should also be required to consider the funding impact of its policy proposals on local government.
The panel also recommended a new Crown department to facilitate the relationship between central and local government, including alignment of priorities and investment plans, and a new stewardship institute to oversee the local government system.
Model of Unitary Council from Future of Local Government report.
And that system needs to be completely reorganised, with the panel recommending two models: a unitary model where regional councils and district councils fall into the unitary council (similar but not necessarily the same as Auckland), or a combined network model, where local councils remain but under the umbrella of a combined council.
The former would be a one-stop-shop approach allowing appropriate activities to be delivered at scale. In the latter, a combined council would provide backbone support for local councils via shared services where agreed, such as transport or civil defence.
Combined council model, from Future of Local Government report
Palmer said each council should consider which model was suitable, and a starting point could be the 15 regions proposed in the RMA reforms - though the panel was not pushing for 15 councils.
Palmer said it was about enabling local government to work out what was best. “Regions need to consider how local voices and decision-making, as much as possible, remain at a local level first.”
Panel member Penny Hulse added that the panel did not have “an amalgamation agenda”.
But if councils didn’t agree, Palmer said decisions could be made for them, possibly by the new stewardship institute.
Asked what likely support there would be for the new system given the strong opposition from some councils to Three Waters, panel member Brendon Boyle said local authorities had told the panel that they wanted to determine what model should be in place for their region.
Future for Local Government panel chairman Jim Palmer.
The panel, which delivered an interim report with 29 draft recommendations in October, also recommended:
Single transferrable vote nationwide for local elections
Enable mana whenua appointees to councils
Lowering the voting age for local elections to 16
Embedding the purpose of local government into legislation, which would require a parliamentary supermajority.
The Government will now consider the report but no response is expected before the October election.
Palmer said he hoped the report would generate discussion within each political party as they develop their local government policies for the election.
The panel’s proposed timeline was a two-year consultation on which model for which region, and a further three years for implementation.
Panel members included Palmer, former chief executive of Waimakariri District Council; Hulse, former Auckland deputy mayor; Boyle , former chief executive of the Ministry of Social Development, Land Information New Zealand and the Department of Internal Affairs; Gael Surgenor, who held senior roles at Auckland Council from 2012 to 2021; Antoine Coffin, who has 25 years experience in Māori resource management and community engagement.
