Archive | Councils

Council value for money review gets tick tomorrow

Auckland Council goes to the basics of the super-city tomorrow when its finance & performance committee will formally institute a “value for money” programme review aimed at lifting efficiency savings from $183 million in 2014-15 to $300 million/year by 2025.

The cost-effectiveness review programme also lifts the supervision of council-controlled organisations – particularly the big ones, Auckland Transport, Watercare Services Ltd & Ateed (Auckland Tourism, Events & Economic Development Ltd) – from sniping when one of those organisations steps out of line, to a closer performance audit.

When the super-city council was formed at the 2010 council elections, the new council had a number of key tasks to do, all at once: rationalise services & expenses, equalise costs to ratepayers across all the old 7 territorial council areas, and establish what the new council should & shouldn’t do. On top of that broad equalising, the council had major plans to create for specific areas and, for the whole region, the unitary plan that would combine regional policy statements & district plans in one document.

Given tight timeframes for everything it was doing, the new council didn’t try to go back to ground level in 2010 and decide then exactly what it should be doing across the whole region but, naturally, chose to work with the previous councils’ programmes and whittle them down to a consistent presentation.

Now, the work starts in earnest.

Section 17A of the Local Government Act requires councils to review “the cost-effectiveness of current arrangements for meeting the needs of communities within its district or region for good quality local infrastructure, local public services and performance of regulatory functions”. A review must consider options for the governance, funding & delivery of infrastructure, services & regulatory functions.

The review laid out for the finance & performance committee by value for money programme manager Sally Garrett introduces “a framework to evaluate expenditure and to provide greater accountability to the governing body & the ratepayer on what is being achieved with public expenditure. The objective of the programme is to analyse cost-effectiveness in a systematic manner across the Auckland Council group and to provide a basis on which more informed decisions can be made on long-term planning priorities.”

The first 3-year review programme starts with 2 phases, initially focusing on activities & services considered high priority to assist in the development of the 2018 long-term plan. Ms Garrett says in her report to the committee it’s assumed each review will take 2-4 months and that up to 4 reviews can be run at the same time.

The first 4 reviews will be:

  • 3 waters – water, wastewater & stormwater budget categories
  • Domestic waste – domestic waste services including refuse, recycling, inorganics & organic services
  • Organisational support – communications & engagement services across the council group, followed by a rolling series of reviews including transactional services, payroll, finance, information systems, procurement, human resources, customer services & legal functions, and
  • Investment attractions & global partnerships – how investment attraction & global partnership services are delivered across the group.

Under the programme, expert panels will be appointed in April-May, data for the first 4 reviews will be collected & analysed from May-August, and conclusions & recommendations will flow from July-September.

The woman managing the programme, Sally Garrett, has a long history in this type of work, first in her 5 years as a principal in Ernst & Young’s management strategy group, then for 6 years as Watercare’s business services general manager. During 3 years as an independent consultant, Ms Garrett assisted the royal commission on Auckland governance and put together the programme for Auckland City Council to manage the transition to the super-city council, including overseeing the due diligence phase and the migration of staff & assets.

She joined Auckland Council in 2012 to manage the finance transformation programme and was appointed to run the value for money programme in 2015.

Attribution: Committee agenda.

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Auditor-general argues for more Westgate deal disclosure but doesn’t see wrongdoing

Auditor-general Lyn Provost told Parliament yesterday, in a report tabled on dealings between the Waitakere City and Auckland Councils and Westgate landowner NZ Retail Property Group Ltd (NZRPG), that both councils could have made better disclosure. But she did not disclose any wrongdoing in the financial arrangements.

Image above: The Westgate layout looking down the North-western Motorway toward Henderson, as it was in 2013.

The Auditor-general’s office looked into specific aspects of Auckland Council’s project to develop a new town centre in Massey North (the council name for what NZRPG always called Westgate) after several people raised concerns about the establishment & management of this new town centre. They questioned whether the public & private costs & benefits of the project had been appropriately balanced between Auckland Council & a private developer.

Auditor-general Lyn Provost.

Mrs Provost said the focus of the office’s inquiry was on Auckland Council’s management & governance of the project from 1 November 2010, when the newly amalgamated council inherited the project from the now dissolved Waitakere City Council.

“One of the concerns raised with us was about the lack of transparency, in particular being unable to access information about the project. In our view, Auckland Council could have made more information about this development available. It is important that local authorities strike the right balance between balancing commercial sensitivity, maintaining legal privilege as appropriate and being open with ratepayers & elected officials. Such openness allows public discussion & debate, and is essential to supporting public sector accountability. This exercise has highlighted once again the importance not just of making good decisions but also of being able to show that good decisions have been made.”

The background

A block in the first Westgate stage, pictured in 2012.

Companies in the NZRPG group owned or controlled much of the land where the new town centre was to be located. As a result, Waitakere City Council entered into a memorandum of understanding with NZRPG in 2004 to establish a collaborative working relationship to design & develop the town centre. In 2010, the council & NZRPG entered into a suite of contractual arrangements for the actual development of the new town centre and the sharing of the costs between them.

“While the focus of my inquiry was on Auckland Council’s management & governance of this project from 2010 onwards, concerns were also raised about Waitakere City Council’s decision to pay the developer $6 million for a street in the existing Westgate shopping centre. Concerns had been raised about this purchase because, usually in a new development, a developer will bear the cost of constructing roads – which then vest in the council at no cost when land is subdivided.

“Accordingly, in order to provide sufficient context, my report sets out additional background detail about the decision-making process undertaken by Waitakere City Council in relation to the purchase, and the basis on which the purchase price was agreed.

“Concerns were also raised with my office about the contractual arrangements between Waitakere City Council (and, subsequently, Auckland Council), Transpower & NZRPG to relocate transmission lines passing over the development, underground. Waitakere City Council entered into an agreement with Transpower to pay the costs of the relocation.

“The evidence supports the need to relocate the power lines for the development of the town to proceed.

Development in 2015: The first stage of the North-west shopping mall completed, ground works started for stage 2 and the public square, Te Pumanawa.

“In the agreement with Transpower, Waitakere City Council accepted the primary responsibility to pay all the cost of relocating the lines – that is, its own 35% & NZRPG’s 65% share of the cost. The share of the costs to be paid by NZRPG would be recovered under a separate agreement between Waitakere City Council & NZRPG.

“Waitakere City Council was clearly aware that, in accepting the primary payment risk, it needed to protect its position in case NZRPG failed to pay its share of the costs. It put in place several mechanisms to provide this protection, including an offsetting agreement.

“Importantly however, although Auckland Transition Agency confirmed the agreement with Transpower, it did not confirm the offsetting agreement. As a result, the agreement with NZRPG to pay its share was legally invalid. As a result, the council was party to a binding contract to pay the full costs of relocating the power lines without having a corresponding binding contract in place to recover NZRPG’s share of the costs from NZRPG.”

Auckland Council inherited the project and the issue relating to the legal invalidity of the agreement, and resolved this issue by entering into a new agreement with NZRPG to share the costs.

“However, in 2012, it then decided to postpone NZRPG’s obligation to pay its share. Council documents indicate that this decision was made because it perceived a risk to the progression of the project. The result of this decision has been that the financial risk borne by the council & its ratepayers will continue until such time as NZRPG’s contribution has been fully paid. As at 20 September 2016, NZRPG had paid about $3 million of the $11.3 million it owed to Auckland Council.”

Mrs Provost said Waitakere City Council carried out several infrastructure works at its own expense, as part of its contractual relationship with NZRPG. This included construction & widening of roads, the development of intersections, provision of water supply & wastewater services, and the design & construction of the town square & library. “The intention was that the council would subsequently recover some of the costs associated with this work through development contributions to be paid by the developer….

“The calculation of development contributions in this project was not straightforward, given the complexity of assessing the balance between the public & private benefits of the development. We have been unable to ascertain or calculate the value of the development contributions, but expect it to be a significant amount of money.”

On 28 October 2010, days before Auckland Council took office, Waitakere City Council reached an agreement with NZRPG to vary the amount & timing of payments of development contributions.

This was recorded in an exchange of letters over 2 working days, but Mrs Provost said the Auckland Transition Agency didn’t confirm the decision.

“Auckland Council subsequently entered into an agreement with NZRPG to formalise the development contributions arrangements. The agreement provides for the offsetting of some of the development contributions owed, as well as the postponement of when some development contributions are to be assessed & paid.

“While there are still development contributions payable by NZRPG before the end of the project, Auckland Council has taken on a greater risk at this stage in the project by the postponement of these payments. Whether the final amount of development contributions is appropriate will need to be weighed up as part of the overall balance of costs between the parties at the conclusion of the project.”

Specific steps taken by Auckland Council

Once Auckland Council became responsible for the project, Mrs Provost said it immediately sought legal advice on the agreements it had inherited.

“It became clear that the Auckland Transition Agency had not confirmed all of the agreements, which was a prerequisite for transfer to Auckland Council. Auckland Council signed replacement agreements to ensure that they were all legally valid. In October 2011, the regional development & operations committee of Auckland Council agreed that a review into probity issues raised at the committee be conducted and that the review be reported back to the committee for further consideration. Auckland law firm Meredith Connell was commissioned to undertake that review.

“In my view, commissioning this review was good practice given the complicated matrix of arrangements between the former Waitakere City Council & NZRPG. The review put Auckland Council in a good position to understand the obligations it had inherited and any risk that it might need to manage.

“The Meredith Connell review was summarised & discussed at the public-excluded part of the June 2012 regional development & operations committee meeting. The committee agreed that the report & associated resolutions remain confidential until the reasons for confidentiality no longer exist.

“Auckland Council has since improved the contractual arrangements with NZRPG, including linking payments more directly to the delivery of work and instituting a better procurement process for subcontractors working on the new town centre.”

Auditor-general’s conclusions

Mrs Provost concluded: “The amount of information provided to the elected members of Auckland Council on this development could have been more comprehensive. Councillors have been concerned about the project and should not need to resort to me to get answers.

“In my view, the risks involved with this development warrant greater involvement by Auckland Council’s governing body in overseeing the project, including its costs. More information & clarity about the issues that management need to refer to the governing body would help this oversight.

“Public concerns have been raised with my office, and directly with Auckland Council, about the lack of transparency with this development. My office received complaints from members of the public who have been unable to access information about the project, including the Meredith Connell report. Similar concerns have been expressed to my office by council members.

“It is important that local authorities strike the right balance between balancing commercial sensitivity, maintaining legal privilege as appropriate and being open with ratepayers & elected representatives to provide transparency about the agreements they enter into and to demonstrate that they are getting value for money. Such openness allows public discussion & debate, and is essential to supporting public sector accountability.

“In my view, Auckland Council could have made more information about this development available. Auckland Council obtained the Meredith Connell advice on a confidential basis and has treated the report as legally privileged & commercially sensitive.

“Given the public interest and that commercial sensitivity has likely reduced with the passage of time, I encourage Auckland Council to consider what information it could now release – including all or some of the Meredith Connell report.”

Link:
Auditor-general’s statement & report

Attribution: Auditor-general’s office.

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Goff gets agreement on council budget consultation and starts to tighten grip on CCOs

Auckland Council’s finance & performance committee held a 9-hour session yesterday which indicated some directions under the new mayor, Phil Goff: a closer watch on its commercial operations, a tighter rein on costs and a bigger role for local boards.

Helped by committee chair Ross Clow’s clear intention to keep things flowing, the council made progress without the usual surfeit of political speech-making, with mostly succinct questioning, and an awareness of the subject matter as it had been circulated early enough to be digested.

Mr Goff made it clear right from his first meeting that questions would be questions, and he’s drilled the message home. His next task is to convince the boards of the council-controlled organisations that they aren’t autonomous, that when the council wants an answer it should be given a proper one, and that those organisations will have to lift their performance – not just by a smidgeon, but by multi-million-dollar shifts in both savings & earnings.

That seismic shift in performance would be worth far more than a bed tax, in both dollars & perception, though that tax is still on the wishlist.

The council finance committee’s main tasks yesterday were to go through the quarterly reports of the council-controlled organisations and of the council itself, approve the pro forma half-yearly accounts to 31 December and, toward the end of the day, discuss the letters of expectation the mayor had written for the council-controlled organisations and, the last, to put finishing touches to the public consultation document on the council’s annual budget, to go out in the New Year.

The committee agreed to one amendment to the mayor’s consultation proposal – put by new councillor Desley Simpson and seconded by the mayor – to seek other operating revenue streams to minimise the impact for ratepayers.

A proposal from councillors Wayne Walker & John Watson to consult on introducing chemical-free weed control in public parks & reserves & urbanised areas, including the option for a targeted rate to fund any additional costs, was defeated, though not entirely rejected. A number of councillors supported the principle but there was debate on costs and some aspects of implementation, and the mayor said that, if it was to be introduced, it ought to be done properly & after thorough examination.

The third amendment, proposing such a review, became a note to be forwarded to the council’s environment & community committee.

The revised budget consultation proposal goes to the council’s governing body for approval tomorrow.

This story outlines the main business of yesterday’s meeting, but not the real content – the debates & position-taking. I’ll try to get that extra story posted for Friday.

Attribution: Council committee meeting.

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New mayor wants bed tax, fuel tax & new housing tax

Auckland mayor Phil Goff released his budget plan today to restrict rate rises and raise significant new revenue while restraining borrowing and supporting underpaid & vulnerable residents.

His proposal goes to Auckland Council’s finance & performance committee on Wednesday, returns to that committee on Tuesday 13 December and on to the council’s governing body 2 days later for approval to be put out to consultation.

  • I’ll be adding new pages to this story this evening as I read through the proposal, which runs to 68 points & 15 pages.

Mr Goff has proposed restricting rate rises to a 2.5%/year average and introducing:

  • a visitor levy (bed tax)
  • a targeted rate for new largescale housing developments, and
  • a regional fuel tax.

In a release out this afternoon, Mr Goff said: “Ratepayers have shouldered the responsibility for the growth of our city and cannot be expected to continue to do that on their own. This proposal shares that responsibility more fairly across all of those who benefit from living & doing business in our city.”

Mr Goff said his proposal delivered on his campaign commitment to restrict rate rises: “I made a commitment to restrict the annual average rate rise to 2.5%, down from 3.5%, and that is what this proposal delivers.”

The proposal would implement his commitment to a living wage for council employees and contribute an additional $500,000 to co-ordinating work to support homeless Aucklanders: “This proposal puts the people of this city first by taking a responsible & fair approach to tackling Auckland’s growth challenges, and seeking to support those who most need help to live a decent life in our city.”

Mr Goff noted that significant work was underway at the council to find efficiencies across the council group, which includes Auckland Transport, Ateed (Auckland Tourism, Events & Economic Development), Panuku Auckland Development, Regional Facilities Auckland & Watercare Services Ltd.

“We are taking a responsible fiscal approach by ensuring that Auckland Council is more efficient and delivers value for money while finding innovative ways to raise extra revenue to support growth.

“Accommodation providers & other businesses benefit most directly from the funding the council puts into attracting visitors to the city and supporting major events. That is why I am proposing a new visitor levy to be collected by hotels, motels & B&Bs to replace ratepayer spending by Ateed in this area.

“We are also ensuring that we remain well within the council’s debt cap to avoid a potential credit downgrade which would force ratepayers to fund millions of dollars in extra interest costs.”

The mayor has set out a series of recommendations for consultation and promotes these initiatives:

  • Raising up to $30 million from a new visitor levy to replace ratepayer funding currently spent on attracting visitors and supporting major events
  • Introducing a targeted rate for new largescale developments to pay for major new infrastructure, increase Auckland’s housing supply and discourage landbanking
  • Seeking Government support to implement a regional fuel tax to help close the $400 million gap in transport infrastructure funding which the Government & council identified through the Auckland transport alignment project
  • Bidding for a significant share of the Government’s housing infrastructure fund
  • Generating savings from efficiencies across the Auckland Council group
  • Introducing a living wage for council employees, and
  • Contributing $500,000 to co-ordinating work to support homeless Aucklanders.

The uniform annual general charge would rise by 2.5% and the business rates differential, which has been programmed to decline to zero over several years, would remain unchanged from this year’s figure.

The visitor levy (bed tax) has been proposed for Auckland many times and has been fought off by the hospitality sector. Its proponents have regarded it as separate from rates – although that income is what hotels use to pay their rates, in the same way that every other landlord uses rent to pay rates.

“The initiatives that I’m promoting will require collaboration with central government, businesses & our communities. We want to work openly & honestly with all of our partners to make sure that Auckland is one of the world’s best performing cities.

“Given it is only 4 weeks since inauguration, there is still a lot of work to be done. Many of these initiatives will fall under the long-term plan, but it is important to start consulting Aucklanders now.”

Following the December meetings on what should go out to consultation, the council is scheduled to adopt its consultation document & supporting material on 9 February, run the budget consultation through February-March, confirm decisions to be incorporated into the budget on 1 June and adopt the budget on 29 June.

Earlier stories:
22 July 2015: Corrected: Councils want tax reshuffle, innovation a long way off
29 June 2009: ARC overcomes canning of fuel tax, sets 3.9% rate rise
8 October 2008: Penlink gets tick along with electrification, ferries & tickets in first bite of regional fuel tax
13 November 2006: Stadium on the wharf will require a bed of new tax
6 November 2005:
Council looks more closely at bed tax
2 March 2004: Councillors opt for bed tax report
2 March 2004: Christmas present: new tax
2 March 2004: On the road to a supercity
16 August 2002: Councillors opt for bed tax report

Links:
Mayoral proposal for 2018 annual plan pdf
Local authority funding project

Attribution: Mayoral release.

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Minister defers return of bill to redesign local body sector

Local Government Minister Peseta Sam Lotu-Iiga has asked the select committee considering the Local Government Act 2002 Amendment Bill (No 2) to extend the report back date from 28 October to 31 March to allow for further policy consideration & drafting changes.

The bill provides for a broader range of functions to be transferred between local bodies, joint governance arrangements for areas of common or shared interest and greater use of joint council-controlled organisations, including CCOs for water services & transport.

It also allows the Local Government Commission to initiate its own investigations in relation to reorganisations, and provides for local body-led reorganisations to be able to make submissions on reorganisation, including the establishment of multiply owned CCOs, joint governance arrangements, transfers of powers, boundary changes & amalgamations.

The bill was introduced on 9 June and the Local Government & Environment Select Committee had finished its hearings, with nearly 200 submissions made on it. Mr Lotu-Iiga said last Friday the deferral would enable more rigorous analysis of submissions and more constructive dialogue with the local government sector.

He said he’d met Local Government NZ and was pleased the sector supported the general objectives of the reform package.

“It is imperative that steps are put in place to ensure core infrastructure including water, sewerage & roads across New Zealand are well managed.

“I acknowledge some of the concerns raised by local government. Solutions need to be found that promote local democracy, while ensuring better quality services & better value for ratepayers…. Local & central government need to work together to develop practical solutions that will ensure better services for ratepayers for our longer-term future.”

Attribution: Ministerial release.

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No ticks yet for mayoral candidates though Goff makes start on fiscal policy

2 candidates for Auckland’s mayoralty have committed to a “ratepayer protection pledge” guaranteeing they won’t vote for any rate or levy hikes exceeding 2%/year in the next council term, and a third candidate has written a policy to cap the residential average rise at 2%. But the candidate most likely to win if the right of politics vote is split 3 ways, Phil Goff, released a fiscal policy yesterday designed to restrict rate rises to an average of 2.5%.

The call for a ratepayer protection pledge was made last week by the Auckland Ratepayers’ Alliance, created by the NZ Taxpayers’ Union, and won support from mayoral candidates John Palino & Mark Thomas. Victoria Crone had already written her own policy with the 2% cap.

Mr Goff’s version of crimping the always-up thinking includes requiring every council department to make savings that would contribute to a new efficiency target of at least 3% of overall spending.

All these percentage thinkers have it wrong.

Picking a number to cut rates by is a great way of ensuring the arms & legs will be cut off, leaving a corpulent policy and no ability to implement it. Auckland City Council did that several years ago.

When the new super-city council was created in 2010, it should have looked at what it needed to do and stuck with it. But the council, in that first year, had an almighty project on its hands to bring consistency across a region that previously had 7 territorial councils & one regional council and, at budget time, it did the usual exercise of seeing what could be left out.

Starting at “what to do” instead of “what not to do” sets the parameters, which can be reviewed.

An example of how to do things badly is in consent processing, an area of the council where customers pay for the service. A predetermined percentage cut would mean that, as the need for inspections rises, fewer people would be available. But, by investigating efficiencies – in this case, including policies set by both government & council – a leaner yet better performance might be possible.

The net result for me is a cross against all those candidates – no ticks.

The Hide ploy

When Act MP Rodney Hide set up the super-city council, a central ploy was to ensure politicians couldn’t get their hands on the commercial businesses of the council, which were semi-quarantined in “council-controlled” organisations.

Thus Auckland Transport, Watercare Services & a few other arms of the council were almost, but not quite, autonomous. But their budgets are, in the end, up for approval by the council, and the council needs to know what justifies the figures, so the semi-autonomy concept could never work satisfactorily.

Mr Goff’s fiscal policy shows a determination to turn those organisations, effectively, back into departments: “A particular focus will be on combining council & council-controlled organisations’ procurement systems and progressively moving towards shared services for the group in terms of back office functions such as finance & human resources.”

Are council departments the way to go? They could be, but New Zealand experience tells you that politicians never fund services & infrastructure adequately when they have direct control – and direct exposure to the reactive votes – which was a big part of isolating them from this risk.

Tax allocation & infrastructure funding

Mr Goff – former housing minister & leader of the opposition – set out brief policy yesterday on 2 issues which deserve far more consideration than politicians have given them: allocation of tax income and financing of infrastructure.

If you allocate tax income according to geographic population, Auckland may well be receiving less than its due. On the same basis, would cycleways – or new housing subdivisions – get any funding? Few people are riding bikes because it’s dangerous or impractical, and nobody lives in these unbuilt subdivisions yet, but logic tells you that funding is required if change is to occur.

Extending that logic, you could argue that these subdivisions should be built somewhere else that’s cheaper, where the land is available, and therefore that the focus should be on shifting jobs to centres outside Auckland.

He advocated replacing the interim transport levy on rates with a petrol tax, as was previously proposed by the council & rejected by the Government, and later switching to a congestion charge or toll. In all cases you can argue that someone is benefiting without paying, and someone is paying without benefiting. Mr Goff’s view on roads was that those who benefit from reduced congestion should pay.

His views on tax & funding: “Working with central government to expand its infrastructure fund and investigate infrastructure bonds: While more than half of New Zealand’s growth is in Auckland, the extra gst & income tax collected goes to central government. I will advocate for Auckland to get its fair share of that extra revenue to pay for servicing that growth.

“To reduce the risk of even greater gridlock & a worsening housing crisis, we need an additional $17-20 billion for core infrastructure to support future urban land areas. It is inappropriate & unfair to fund that solely through the blunt tool of raising rates. We need to find alternative innovative funding sources such as sharing more Government revenue with council, public-private partnerships or raising infrastructure bonds.

“I will also advocate for the removal of the flat levy on rates to pay for a shortfall in transport infrastructure funding in favour of a road charge. This could be in the form of a petrol tax that is later replaced by a congestion charge or toll. It is only fair that those who benefit most from using the roads contribute to the cost of reducing congestion.

“Implementing this fiscal policy will be an important step towards restoring ratepayer & Government confidence in Auckland Council by ensuring that in future it works effectively & efficiently in the best interests of the people of this city.”

Mr Goff is getting somewhere, but should be far further advanced on these policies. I think Orakei board member Mark Thomas has done far better in advocating detailed policies, with assessments of how they would work & their impacts.

Candidate websites:
Crone
Goff
Palino
Thomas

Attribution: Candidate policies.

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Attempt to scuttle Maori vote on unitary plan fails

The “unelected”, who will be “sitting in judgment” on Auckland Council’s unitary plan. Members of the Independent Maori Statutory Board, who are appointed to council committees by their board, were again the target of a bitter minority attack at the council governing body’s monthly meeting yesterday.

The debate – and the aspersions – arose as the council’s governing body decided whether to run a one-tier (governing body only) or 2-tier (through the Auckland development committee, then finally up to the governing body) process to consider the recommendations of the hearing panel on the unitary plan.

Either way, it needs to be done by 19 August, so the council can post its decisions on Friday 20 August, and in the end the decision was clearcut – 13-8 in favour of a 2-tier process (with no Maori board participation in that vote).

More importantly, in a close vote, the 2 Maori board members of the development committee have generally supported mayor Len Brown & deputy mayor Penny Hulse’s position. Those Maori board members sit on committees, but not on the governing body, so at the highest level the mayor loses that occasionally crucial support.

The mayor said councillors also had much more scope to debate at committee level: “On the governing body you have one right to speak & limited questions.”

Unelected?

The “unelected” arrive on the Maori board via contested processes at their mana whenua groups, and they are as elected as half the members of Parliament, who arrive in the House of Representatives through electors’ votes for party lists of MPs after party chiefs decide who will be top & who bottom of those lists.

While swatting off the many personal barbs delivered at them, what the Maori board members of the council’s Auckland development committee have achieved – apart from choosing to speak sense & briefly, which are rare attributes in the council chamber – is firm up the mayor’s majority in votes on the unitary plan.

At odds with the mayor’s stance, Orakei councillor Cameron Brewer has supported measures making it harder to intensify the wealthy eastern suburbs of the isthmus, where the soaring house prices – matched with limited supply & limited opportunity to increase supply – have led the escalation in prices nationally.

The other leading opponent of the mayor’s position that favours intensifying, Cllr Dick Quax, has constantly questioned the compact-city concept and favoured enabling more greenfield development.

Potential conflicts the means of attack

The attack this time was through the potential for conflicts of interest, as Maori groups that statutory board members are associated with have submitted on the unitary plan. In the other direction, Cllr Cathy Casey raised a potential conflict for Cllr Sharon Stewart (a Howick ward councillor who almost always supports fellow Howick representative Cllr Quax’s stance). Cllr Casey said Cllr Stewart had made disparaging remarks about mana whenua and made allegations of corruption.

The mayor & councillors are taking legal advice on possible conflicts, and Mr Brown said he wouldn’t know of anybody’s position on this until the first decision-making meeting on the unitary plan on 10 August, when it would up to individuals to declare any conflict.

Cllr Alf Filipaina commented: “The question for me is, why is it important for the Independent Maori Statutory Board to be out of the process? They were appointed to make this council accountable under the Treaty of Waitangi. The board has been part of the design of the plan. They have been here from the outset.”

Cllr Chris Darby: High praise for Maori board member Ngamene’s commitment.

Cllr Chris Darby: High praise for Maori board member Ngamene’s commitment.

One Maori board member, Liane Ngamane, won high praise from one councillor, Chris Darby, who is deputy chair of the development committee and also chaired a mediation group which dealt with urgent responses to the panel that heard submissions on the unitary plan.

Cllrs Darby & Callum Penrose noted that this group frequently had trouble raising or maintaining a quorum for its after-hours meetings, but Ms Ngamene made it her business to be there or, because she had family commitments in the Coromandel, would conference call from the side of the road to deal with urgent matters that had to be turned around the next day, on all manner of topics: “It was phenomenal commitment,” Cllr Darby said.

Personalised

The question of the Maori board members’ existence at the council has been the subject of vituperative comment from Cllr Mike Lee, who this time voted to support the 2-tier process to consider the hearing panel’s recommendations on the unitary plan, which will take the debate through the development committee before a final wrap-up at the governing body.

Cllr Mike Lee: Switched his vote this time.

Cllr Mike Lee: Switched his vote this time.

Cllr Lee thought Maori board members (and anybody else) who’d submitted on the unitary plan, or been involved in preparing submissions, ought to disqualify themselves from participating in the final decision-making, and wanted assurance that the governing body debate wouldn’t be “a rush-through job” after more careful deliberation at committee level.

Cllr Lee, more than any other member of the council, has had a longer & more potent role in the history leading to the unitary plan, dating back to his time chairing the Auckland Regional Council, which staunchly fought territorial councils’ attempts to open up land for housing development. He was firmly opposed to growth, or providing for growth.

But the lead role in opposing Maori board members’ participation in the unitary plan decision-making process fell to Cllrs Brewer & Quax.

Quax: It defies democracy

Cllr Dick Quax, espousing why the Maori board shouldn’t participate.

Cllr Dick Quax, espousing why the Maori board shouldn’t participate.

Cllr Quax said: “I think now the expectation is that the decisions will be made, and the deliberations will be made, by the governing body – the 20 members who are elected by their communities & the mayor, elected at large to lead the city. And so that is the expectation of the community, and I don’t think that having it delegated to a committee is what the public would expect.

“The decision needs the gravitas & the consideration of the governing body. The conflict I have, apart from the conflicted position that the Independent Maori Statutory Board have, is that it defies democracy to have people who are unelected, who are not accountable, sitting in judgment on the plan which is of huge importance to Auckland. It just doesn’t make sense to have people who are unelected and who are unaccountable to the community – we [the councillors] are all accountable….

“It’s wrong to say that the Independent Maori Statutory Board have not been involved in this process. They have been involved in this process right from the outset, through the Auckland development committee, through the unitary plan committee, they have been involved in this process. We have discharged our obligation under the legislation because the legislation calls on the Independent Maori board to advise council – not to make decisions but to advise council on matters of physical & natural resources.

“So to say that, oh well, this is the decision we made around financial, in fact is quite vexatious because they don’t need – they shouldn’t even be on that particular committee. It’s quite wrong and, in fact, the Government in 2010 sent a letter to the mayor expressing surprise that the mayor had put the Independent Maori Statutory Board members on every committee of this council. They said that that was not their expectation, and it certainly wasn’t their expectation that they [board members] would be sitting here on judgment of the most important plan and making decisions.

“So the 2-tier process that is being proposed here is going to provide a more cumbersome process.”

Issues where there is a close vote at committee level would be relitigated at the governing body, he said.

“If we had wanted to have this passed by a group that was unelected, we should have just said to the independent hearings panel, ‘This is your decision to make, we won’t take any part in the final debate’.

“I won’t be supporting the 2-tier process. I think it is cumbersome, expensive, and I think it is actually a disgrace on democracy to have unelected people sitting in judgment of a plan on which they also submitted.”

[The legislation allows the council to appoint board members to any committees, and says nothing about whether board members should have a vote or not.]

Casey: Attack is insult to people who’ve inspired

Cllr Cathy Casey, holding up the Maori board’s annual report: An insult to say no now.

Cllr Cathy Casey, holding up the Maori board’s annual report: An insult to say no now.

Cllr Cathy Casey, responding, said: “If it is the most important decision we make (Fletcher said), which it, who are we to say Maori shouldn’t have a voice. And I think that’s what this is all about. It’s either you have the Independent Maori Statutory Board, which is our only Maori voice because we have no Maori seats.

“This is about what councillors perceive as the legitimacy of the Independent Maori Statutory Board. That is not what I would want, I would want elected members round this table, but that is what we’ve got…. To say at this late stage you cannot take part is not judgment, Cllr Quax… We’re not inviting them to sit in judgment, we’re inviting them to continue the process of looking at the recommendations. It’s we [councillors] who sit in judgment, and that’s a 2-stage process, which you didn’t have a problem with back in April, when you were at this [governing body] meeting where it was discussed….

“There is a barrier between some councillors & the IMSB, but it’s being dressed up differently. But it’s about whether you think Maori should have a voice on the discussions of the independent hearings panel proposals or not, and I think if you say ‘No’ you’re not just insulting the Independent Maori Statutory Board – whose members we have sat with for the last 6 years, and I welcomed them to my committee, and they’ve been an enormous source of inspiration for me – and now you’re saying ‘Actually, no’. For whatever reason, and there’s a whole host of reasons being given. The reason you need to have them here, as David [Taupiri] says in his chairman’s introduction: ‘We sit on the panels to ensure Maori perspectives are heard within a wide range of decision-making process.

“If you say to the Independent Maori Statutory Board you’re effectively saying no to the Maori perspective being heard.”

Wood: It’s not about the Maori board

Cllr George Wood said: “It’s not about the IMSB, it’s about the process. The act says the only organisation that can approve the unitary plan is the governing body… To have the matter dealt with by 2 groups of this council is unfair, we’ve got no idea how this matter’s going to play out whe it comes to committees or the governing body, and to have it dealt with twice, I believe it will be a cut-down version when it gets to the governing body…..

“The Independent Maori Statutory Board, I don’t know how they work but I believe they get their riding instructions before they get here. We’ve been told it’s got to be independent decisions by ourselves and we make the decisions without fear or favour… It’s the biggest decision this council will ever make and I don’t believe it should be done by the 2-tier process that the mayor has put forward.”

The vote

Councillors for handling the whole unitary plan process at the governing body: Brewer, Fletcher, Krum, Quax, Stewart, Wayne Walker, Watson, Wood.

Councillors wanting it to go through development committee then governing body: Anae, Casey, Cashmore, Clow, Cooper, Darby, Filipaina, Hulse, Lee, Penrose, Sir John Walker, Webster, and the mayor.

Links:
Court of Appeal judgment 15 September 2015
Local Government (Auckland Council) Act 2009

Earlier stories:
21 October 2015: Mataawaka representation on Auckland Council still unresolved
22 November 2014: Willie Jackson forces re-election for Maori statutory board seat

Attribution: Council meeting.

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Lotu-Iiga urges more collaboration between councils

Local Government Minister Peseta Sam Lotu-Iiga called yesterday for greater collaboration between local councils to meet future community needs.

“Local government is a critical building block for our national growth and prosperity. Councils manage more than $96 billion in fixed assets and provide essential infrastructure and planning for local communities.”

He told the Local Government NZ annual conference in Dunedin: “The cost of infrastructure is rising much faster than ratepayers’ ability to fund. Councils are beginning to work towards sharing of resources to provide better services. There is an urgent need for greater collaboration across regions for more effective planning for the next 30 years.”

Mr Lotu-Iiga urged the sector to work constructively with central government on the Better Local Services reforms: “These reforms give councils new options for managing infrastructure and delivering services to their communities without needing to amalgamate. The reforms protect local democracy and encourage local decision making to meet local needs.”

Attribution: Ministerial release.

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Updated: Council resumes bond offer, sets interest rate

Update: The interest rate was set at 3.338%.

Auckland Council opened a $100 million bond offer Thursday, closing Friday, with the ability to accept as much again in oversubscriptions. Fully subscribed, it will take council bonds traded on the NZX debt market over $1 billion.

The interest rate on the 10-year secured, unsubordinated fixed-rate bonds will be set on Friday after a bookbuild, allotments made next Wednesday, trading to open on Thursday 28 July. The council said the indicative margin over the swap rate was 0.9%/year.

The council announced its intention to issue the bonds in mid-June, then decided immediately after the Brexit vote in the UK to defer it because of the uncertainty.

The council has $825 million of bonds listed on the NZX debt market:

  • $250 million maturing 30 March 2020, paying 3.04%/year (AKC090)
  • $250 million maturing 24 September 2020, paying 4.017%/year (AKC080)
  • $200 million maturing 25 March 2024, paying 5.806%/year (AKC070), and
  • $125 million maturing 18 December 2018, paying 4.41%/year (AKC060).

The council said its new bonds were expected to be assigned a long-term credit rating of AA from Standard & Poor’s and Aa2 from Moody’s.

Attribution: Council releases.

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Government accepts almost all “loopy rules” recommendations

Local Government Minister Peseta Sam Lotu-Iiga said on Monday the Government had accepted 72 of the 75 recommendations in a report on “loopy rules”.

The Government has issued a response to the rules reduction taskforce’s report, but Mr Lotu-Iiga doesn’t want improvements to stop there: “I would like to encourage the public to continue to let us know of any frustrating property related rules they experience by emailing [email protected],” he said.

Mr Lotu-Iiga’s predecessor in the local government portfolio, Paula Bennett, announced the taskforce 2 years ago, asking people about what property-related rules & regulations stopped them from getting on with the job.

Mr Lotu-Iiga said the taskforce report published last September provided a wealth of information about rules New Zealanders found didn’t make sense or were inconsistently applied. The report identified 75 opportunities to improve the way rules & regulations were developed & implemented at a local level. Of those, the taskforce highlighted the top 10 fixes that needed action.

“The Government accepts 72 of those opportunities and work is underway across Government to address them. The Government response provides detailed analysis of what actions are being taken now & in the future.

“Customer service was identified by the taskforce as an issue for many New Zealanders seeking building & resource consents and generally dealing with property-related matters. Many of these customer service issues require culture change at local level and we will work with councils to address this.”

Links: 18 July 2016: Response to the opportunities identified by the rules reduction taskforce
Internal Affairs, rules reduction
Loopy rules taskforce
Executive summary
Top 10 fixes
Loopy rules final report
Government response to recommendations of the Productivity Commission’s report ‘Towards Better Local Regulation’

Earlier stories:
22 September 2015: “Loopy rules” taskforce lists its top 10
2 June 2015: ‘Loopy rules’ submissions open for another fortnight
11 February 2015: Bennett names her taskforce against loopy rules
23 July 2014: Bennett says Begone! to “loopy” rules
23 July 2014: All but 2 Productivity Commission recommendations on local government rules accepted
18 July 2014: Productivity Commission sets out ideas for better regulation

Attribution: Ministerial release.

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