Peter Winefield – former Rodney District Council senior officer, nowadays working on management services for MWH NZ Ltd, an international consultancy with particular expertise in power, water & wastewater issues â€“ produced a briefing paper last year on the Local Government Act, philosophical changes, new reports &administrative changes, and on financial provisions.
A central part of his briefing paper is a section on the long-term council community plan â€“ which, as you might expect, gets abbreviated to LTCCP, and which North Shore City Council has kindly decided to call its city plan.
In the old-fashioned version of local government, elections are held every 3 years, people stand on a platform of issues, citizens vote, for the next 3 years the council puts into practice the majority view (which may or may not match platforms on which councillors were elected), and at the end of 3 years councillors are rated in a new election.
A new council, diametrically opposed to the views held by the previous majority, could be elected and put in place a raft of new policies & practices.
As Mr Winefield pointed out to me, the LTCCP process makes that style of operating historical. Yes, the elections are held, yes, we come back 3 years later for another whack at it, but councils are putting their long-term (10-year) plans in place now and the process under the Local Government Act means significant, sudden change will be virtually impossible.
For that reason, citizens holding strong views on any aspect of their council’s proposed 10-year plan need to look at that plan now, because it won’t be reviewed for another 3 years.
The briefing paper:
The Local Government Act 2002 was enacted just before Christmas 2002. Some of it came into effect immediately and the rest on 1 July 2003. However, the act needs to be considered in the context of the much broader policy & legislative change affecting the sector at the moment. There are changes, either already in place or proposed, affecting transport, rating, health, water supply standards, the electoral process, emergency management & resource management. More change is on the horizon.
It is also important to note that not all of the old act has been replaced â€“ about 200 sections of the 1974 act have not been repealed â€“ mainly relating to transport, drainage & the special â€˜Auckland provisions’. It is proposed that these will be reviewed over the next couple of years.
2. Purpose of local government
Previously the “purpose” of local government was expressed in a convoluted, long-winded way. Now, it has been simplified down to two things (s.10):
a) to promote local democracy and
b) to promote the social, economic, environmental & cultural wellbeing of communities – in the present & for the future.
However, there are also a number of â€˜principles’ which local authorities must adhere to â€“ see sections 14 (General), 39 (Governance) and 82 (Consultation). Some of the key new concepts in these sections are canvassed below.
3.1 Full Capacity
A fundamental change to the act is the concept of â€˜full capacity’. Traditionally, councils have only been able to do something if it was authorised by statute. Under the new act they have “full capacity to carry on any activity or business, do any act, or enter into any transactionâ€¦” Many, especially in the business community, expressed concern that this will result in councils â€˜going mad’ under the heady influence of these new powers. But this is unlikely given the burden of public consultation that councils have. In fact the public consultation requirements of the new legislation are a lot more onerous than before â€“ to the extent that there is probably a greater risk of â€˜nothing happening’ than there is of councils going on a spending spree, or taking over new functions.
Councils now have an overriding responsibility to promote â€˜sustainable development’. This term is not defined in the act but it is generally accepted to mean â€˜development that meets the needs of the present without compromising the ability of future generations to meet their own needs’.
Achieving sustainable development requires a different way of thinking & working.
Â· focus on community needs
Â· taking the long-term view
Â· promoting the social, economic, environmental & cultural wellbeing of the community (incorporating these concepts in decisionmaking), and
Â· encouraging participation & partnerships.
There is also a lot more emphasis in the legislation on the place of Maori in local government. Councils are required to have special procedures in place for consulting with Maori, they are required to involve Maori in decisionmaking and also to foster the development of Maori decisionmaking capacity.
Furthermore, when the act was passed there was a consequential amendment to the Local Electoral Act to enable the creation of Maori wards within a local authority â€“ a bit like the Maori seats in Parliament.
3.4 â€˜Whole of government’ approach
Another of the major conceptual changes is the â€˜whole of government’ approach. In future, local authorities can not just look after their own affairs, as many have done in the past. They are required to assume a leadership role relating to the wider interests of the community they represent. The first step is to identify “community outcomes”. In other words, identify what the current issues for the community are, how the community wants the city or district to grow, what the relative priority of these various community outcomes are, and so on. These community outcomes might relate to health, education, transport, or anything else.
However this doesn’t mean that councils now have responsibility for all these things. It simply means that they have to identify what is important to the community and then facilitate some sort of action to help achieve them. For example, if one of the community outcomes relates to transport then the council most likely will have responsibility. But if there were community outcomes about crime or education, then it will probably sit down and work these through with the police or education authorities.
The key is that whereas in the past all these agencies have worked independently they are now expected to work together, with the local council being the co-ordinator. Community outcomes have to be reviewed at least every 6 years and councils are required to report on the community’s progress in achieving these outcomes every 3 years â€“ including reporting on the contribution made by other organisations to those outcomes.
4. New reports & administrative changes
4.1 Long-term council community plan
In future, every 3 years councils will have to produce a long-term council community plan (LTCCP). This will be the primary corporate planning instrument for a local authority. The LTCCP will contain a large amount of information focused on the long-term about community outcomes, the council’s plans & financial forecasts for each activity, a raft of asset management information plus a variety of other things. It has to be audited by the council’s auditor before it is published for public comment and another audit will occur prior to its adoption. The LTCCP will replace the annual plan in the year it is prepared. The clear intention of the act is that annual plans are expected to be relatively minor documents in future.
4.2 Water services & sanitary services assessments
Reflecting the Labour Government’s commitment to the public provision of basic infrastructure there is an obligation on local authorities to continue to provide water services and to maintain their capacity to supply. Generally speaking water assets can’t be sold, divested or used as security and contracts for water operations can’t exceed 15 years. (These provisions effectively remove the ability to enter into the type of franchise arrangement that the Papakura District Council did.)
But in addition to this, Parliament has introduced additional requirements for water & sanitary services “assessments”. These assessments are a major new public consultation process focused on the water, wastewater, stormwater, landfills, refuse collection, public toilet & cemetery activities of councils. In the past, these â€˜less exciting’ issues have taken a back seat when it came to public consultation but the new legislation requires that they be the subject of specific community consultation.
The new Local Government Act has also introduced highly prescriptive & complex decisionmaking provisions. These provisions relate to all decisions, including a decision to â€˜do nothing’, and require that for every decision “all reasonably practicable options” be assessed and that each option be considered in terms of:
Â· the social, economic, environmental & cultural wellbeing of the district (now & in the future)
Â· the extent to which community outcomes would be promoted or achieved
Â· the council’s ability to meet its statutory obligations, now & in the future
Â· any other matters that are relevant, and
Â· where it is a “significant decision” relating to land or water, Maori values.
It is also expected that community views be taken into account at all stages of the decisionmaking process. The extent to which these “requirements” are complied with depends on the significance of the decision.
The act has also increased the number of situations where a council is not able to make a decision without first undertaking a formal public consultation process. There is a lot of emphasis on consultation in the new act – including the introduction of consultation principles in s.82.
4.4.1 Bylaw review
The new act requires that all bylaws be reviewed by way of the â€˜special consultative process’ (in other words, a process requiring extensive community consultation) by 2008.
4.4.2 Code of conduct
All councils are required to adopt a code of conduct â€“ a document that regulates the behaviour of elected members.
4.4.3 Triennial agreement
All councils within a region are required to sign a â€˜triennial agreement’. The purpose of the agreement is to establish protocols for collaboration and co-operation between the councils. The first such agreement has to be in place by 31 December 2003.
4.4.4 Governance statement
All councils are required to produce a governance statement every 3 years. The statement has to include a wide range of information relating to electoral matters, governance structures, meeting processes, etc. The first such statement is required by 31 December 2003.
4.5 Financial provisions
There is not a great deal of prescriptive change for local authorities in their financial management – but some of the wider philosophies behind the act will have a marked effect.
There is still a requirement for prudent financial management and a similar range of financial policies relating to funding, liability management, investment & so on. There are also a couple of additional policies required relating to development contributions & partnerships with the private sector.
There is still a â€˜balanced budget’ requirement – but this can be varied where a local authority considers it financially prudent to do so (refer s.100).
The emphasis in the legislation on â€˜sustainability’ might have the effect of changing the reporting structure of local authorities over time and this might be compounded by the requirement that in the LTCCP the council identify which community outcomes â€˜activities’ (transport, water, landfills, etc) primarily contribute to.
However, as noted earlier in this paper, there is much more emphasis on robust, integrated, long-term financial forecasting – and the importance of this is underlined by the requirement to have the draft LTCCP audited before & after publication! The level of financial integrity contemplated for the LTCCP can only be achieved if there are comprehensive strategies in place for each activity supported by (in the case of infrastructure matters) detailed & accurate asset management plans. The need for improved infrastructure asset management & more robust long-term financial forecasting is one of the main implications of the act.
The new Local Government Act is an important & interesting piece of legislation. But it is an enigma. For example, it entrusts councils with more power and a leadership role in their respective communities but it ties their hands with even more public consultation & a prescriptive decisionmaking regime. It also makes the local government environment more complex with the overriding (but undefined) mantra of â€˜sustainability’.
The cost of local government will undoubtedly increase as a result of this new act and some councils will struggle with the increased level of sophistication. On the other hand, the increased focus on long-term planning & integrated government is long overdue.
Websites: MWH Global Inc
Auckland City Council’s Focus on the Future
Manukau City Council’s first long-term plan runs for 10 years from 2003.
North Shore City (its city plan is at the top of its home page at the moment)
Rodney District Council launched its long-term plan on 18 March