Rodney Hide
20 November, 2009
Speech to the Passing Go Conference
Good morning, and thank you for the invitation to join you today. It is good to be here on the North Shore to discuss the Government's vision for the future of the Auckland region.

I will discuss the structure of the new Auckland Council, including the role, powers and functions of local boards.

I will also talk to you about the work I am doing on local government reform, and the implications this might have for local government's role in social wellbeing and for the not-for-profit sector.

I look forward to hearing your views and answering your questions after my speech.

Reform of Auckland governance is a priority for the Government.

Auckland's future depends on critical decisions being taken at a regional level. We need regional governance to overcome the competing interests, parochialism and factionalism that have for decades held back Auckland's progress to the status of a world-class city.

Our vision for Auckland is of an economic powerhouse for the country. It will be a city that attracts people from around the world with its vibrant and diverse communities, and its creativity, culture and heritage. It will be an exciting city where people feel stimulated, welcome and safe.

The Government is working to set up a framework on which we can build this vision. We are looking at change in many areas: economic; planning; transport; and, of course, social outcomes.

Good social outcomes are vital to achieving our vision. What we do in the social area will make a major contribution to the success of Auckland as a world-class city.

The Auckland Council, as a unitary authority, will represent the interests of the entire Auckland region and foster a common identity and purpose.

The Government wants Auckland to speak with one voice on critical regional issues. One Mayor and one Council will represent a united Auckland.

Together, the governing body of Mayor and 20 councillors, and around 20 local boards, will form the Auckland Council. The Local Government Commission will be announcing details of the local board boundaries, and the wards for the Auckland Council, later this morning.

We want effective community representation, with local boards playing a meaningful role in the Council by making local decisions for their communities.

We see no reason for the Mayor and governing body of the council to be diverted from regional issues and caught up in local matters best handled locally.

More unified decision-making, a single rates bill, less duplication, better transport and infrastructure, and more efficient services will all contribute to Auckland being a city where people will want to live and prosper.

I would like to quickly recap the progress we've made.

Two Acts on Auckland governance have been passed, with a third to be introduced next month.

The Local Government (Tamaki Makaurau Reorganisation) Act was passed in May, establishing the Auckland Council and the Auckland Transition Agency.

The Local Government (Auckland Council) Act sets out the governance structure of the new Auckland Council, including local boards and Auckland boundaries.

The third bill is expected to be enacted in mid 2010.

It will provide the ongoing governance structure and functions, the roles and powers of councils and local boards, and a detailed legislative framework for governance arrangements.

Last month I announced the Cabinet decisions on the review of transparency, accountability and financial management in local government.

When I became Minister of Local Government it quickly became clear to me, from letters I received and the public meetings I attended, that many people are very concerned about increasing rates, and many are struggling to pay these increases.

Analysis of councils' 2009 - 2019 long-term council community plans indicates that rates income will continue to rise faster than council costs.

Even more concerning is that the cumulative increase in rates per head over the next 10 years is 49 per cent, and that rates funding will increase as a proportion of councils' operating receipts.

Over that period, councils' planned capital expenditure will total $31.4 billion, and total debt is forecast to rise to $10.8 billion.

The work I have underway in local government reform is guided by three underlying principles.

The principles are:

- local government should operate within a defined fiscal envelope

- councils should focus on core activities, and

- council decision-making should be clear, transparent and accountable.

The decisions recently made by Cabinet will help ratepayers and residents to understand council costs, rates and activities a whole lot better, so they can exert greater influence and control during planning and decision-making.

As a result, council plans will be simpler and more strategic in focus, financial disclosures will be in plain English, and councils will have more flexibility in choosing effective and efficient delivery methods for water services.

Council reporting will be consistent to enable residents and ratepayers to make comparisons between different councils. And processes will be simplified and streamlined.

From 2013, every council will produce a pre-election financial report to allow voters to make informed choices.
I believe councils' consultation processes are unnecessarily onerous and complex. Worst of all, they are largely meaningless to the average ratepayer.

Most LTCCPs are bulky documents running to hundreds of pages, and often more than one volume.

This makes it difficult for residents to identify the things that really matter to their communities, and can also deter them from taking part in decision-making processes.

It is possible to remove a lot of the more descriptive, highly technical and non-strategic material from LTCCPs to produce a document people can more easily understand.

A change that will interest you is the integration of the community outcomes process with the long-term council community plan.

LTCCPs will be renamed "long-term plans" and will have a more strategic focus. This will eliminate the costs and inefficiencies of running two separate long-term planning processes.

Other benefits of the changes include greater attention to the prioritisation and affordability of proposals, allowing communities to decide the issues they want their councils to consider, and clearer links between a council's outcomes and the means of achieving them.

Essentially, there will be greater flexibility for councils in responding to community needs, and clearer information for the public by integrating community outcomes into strategic planning.

It is important that decisions about the role of councils continue to be made locally, rather than by central government.

And council activities and decisions should match the priorities of the ratepayers who foot the bill.

Earlier this year, I was fortunate enough to visit the City of Manukau Education Trust (COMET). This programme brings business CEOs into schools, takes school principals into businesses, and brings parents and grandparents into the classroom to learn to read and to write.

Programmes like this help businesses and schools to better understand one another. Parents and grandparents have learnt to read and to write, and gone on to get degrees and to teach. The children's performance at school has dramatically improved.

COMET taught me the crucial role local government can play in better directing and facilitating centrally funded education and development programmes.

I am enthusiastically working with the Minister of Social Development and Employment to see how we can, through local government, achieve much more in this area.

Another area of concern I am addressing is the huge variation in how councils currently present financial and performance information. Even something as simple as rates income is reported in three different ways in council plans and reports.

It is imperative we have good quality comparative data for accountable and transparent local government.

We can then see which councils are using best practice and getting value for money, and which are not.

Pre-election financial reports will compile existing information, giving an account of activities over the previous three years, and identify proposed items of expenditure for the next three years.

This will give residents up-to-date information about the performance of the current council, and a clear understanding of the issues the incoming council will need to consider.

In the run-up to an election, it is important for communities to be informed about the issues facing a council and the decisions that need to be made.

The question of the core business of local government has been the subject of much discussion in recent months.

These reforms are about giving councils, in consultation with ratepayers and citizens, the ability to do a better job prioritising expenditure locally and staying focussed on the provision of essential services.

Local authorities need to ensure they engage in meaningful and effective consultation with their residents.

All New Zealanders share expectations of the services their councils will provide.

I would like to see local authorities planning for and funding these services, many of which have a long history of council funding, rather than more financially risky or novel activities, like movie theatres.

If councils choose to invest in recreational activities, and the preservation and development of people's culture and heritage, funding to voluntary groups in those sectors should not be affected by my proposals.

These changes will be covered in the Local Government Amendment Bill, which I plan to introduce to the House later this year or early in 2010. There will, of course, be a chance for public input through the select committee process, and I encourage people to make their views known.

Submitters on the 2nd Auckland bill sent a clear and powerful message that they wanted to put the "local" back into local government. The select committee heard that message, and made recommendations around local boards that were incorporated into the Act.

Auckland is a diverse region. Our neighbourhoods are extraordinarily different one from the other. A one size fits all approach to local boards just won't work.

We need to make sure that boards both effectively represent and address their own unique character and issues. In this way, local views will be fed into the broader decision-making at the Council level.

The improvements made to the purpose, decision-making responsibilities, functions, duties and powers of local boards empower them to effectively represent and advocate for their communities.

As set out in the Act, local boards will be better able to promote the social, economic, environmental and cultural wellbeing of their communities.

The decision-making responsibilities of local boards include:

- the non-regulatory activities of the Auckland Council

- identifying the interests and preferences of local residents in relation to council plans and policies

- adopting a local board plan for their communities

- identifying and proposing bylaws to the governing body of the Council, and

- reaching agreement with the governing body for local services and facilities.

Local boards will also engage with community organisations and special interest groups, and consider and report to the Council on any matter of interest to them.

The range of activities of each local board will vary over time and place, but include responsibility for libraries, swimming pools, community facilities, supporting social and economic development, and improving the character and amenity value of their community.

Under a funding policy set out by the Auckland Council, local boards will have control of budgets to meet the costs of funding local activities and administrative support.

The Council will take into account factors that would significantly affect the nature and level of services needed in a local area, such as demographics, the board's assets, facilities and services, the rates revenue and the socio-economic status of the area.

The question of how locals will get their powers is simple and straightforward.

Every three years, the Auckland Council's Long Term Plan will identify the local activities, including services and facilities, which local boards will control.

It will also set budgets.

Decisions about services and facilities will be made by local boards, unless there is a good reason for making them on an Auckland-wide basis.

The initial allocation of responsibilities and budgets to local boards will be the responsibility of the Auckland Transition Agency, the ATA.

The ATA is to examine the functions and responsibilities of current councils, and assign those they determine to be local rather than regional to local boards.

Once agreed to by the board and governing body, they cannot be taken away without agreement.

Where disagreements arise, a disputes resolution process will be put in place.

As my colleague Paula Bennett has said this morning, local and central government have critical roles and responsibilities to deliver on social outcomes for the people of Auckland. Together, local and central government contribute $12 billion dollars in Auckland every year.

I will be working with my government colleagues to ensure the work being done to support social wellbeing is effective.

The Social Policy Forum will provide a great means for communities, the council, and central government to identify important social issues for Auckland, and how we can tackle them.

We all share responsibility for ensuring the people of Auckland reach their potential - and we know the best outcomes are achieved by working together.

The Government is working hard to deliver local government reform that will provide real local authority and strong regional government for the people of Auckland.

The new local governance structure will deliver decisive leadership, robust infrastructure, and the facilities and services of a world class city.

Local democracy will be retained and people's voices will be heard. And Auckland's many voluntary groups will continue to thrive.

Thank you again for the opportunity to speak to you today.

I look forward to your comments and questions.

ENDS

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