Dunedin Council Competes Against Ratepayers

The purchase of roading and drainage companies by the Dunedin City Council's `Delta Utilities' company must be of concern to industry, ACT Rural Affairs Spokesman Gerry Eckhoff said today.

"While it may well be a logical step for Delta, expansion of council-owned business is alarming.

"Once the power of general competence is extended to companies with their captive ratepayer source of income, there will be no business that councils cannot acquire in "the public interest".

"The real question companies should ask themselves is whether it is appropriate for council-owned companies to compete against their own ratepayers.

"There are too many examples of bad investment decisions being made by councils, forcing ratepayers to bail them out. Council-owned companies will not be compelled to even make market returns under legislation proposed by Labour, enabling them to undercut private companies.

"The Local Body Amendment Bill which will provide councils with the "power of general competence" is currently before select committee and could well be reported back before Christmas.

"Councils should not be empowered to compete against private and public companies - this is yet another extension of the state's influence and control over New Zealand industry," Mr Eckhoff said.

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