Local Government Minister Rodney Hide is doing his best to go out with a bang. Actually a shot at local government as presently constituted.

He recently released a Cabinet paper titled: Smarter Government, Stronger Communities: Towards Better Local Governance and Public Services. The paper sets in motion a review of all local governance in New Zealand.

Here are some passages that might make some Hawke’s Bay Councillors a bit nervous …

Regarding “Vulnerable Districts” …

“Some districts have small populations, limited revenues, aging infrastructure and large areas to serve. They can struggle to maintain capability and capacity, efficiently carry out their regulatory responsibilities, provide levels of service that their communities want, and afford modern systems (such as information technology) and the expertise to run them. Their small resource base makes them vulnerable to shocks, such as natural disasters or rapid increases in the cost of raw materials, and they may lack the resilience to recover.

DIA has analysed financial performance and demographic data and has identified rural and smaller provincial councils that are potentially vulnerable.  The most vulnerable districts have councils with relatively high levels of debt and rates per capita. They are characterised by small populations which are static or declining, and have low density. These councils tend to have large road networks and a number of small dispersed water networks. Their communities have lower incomes and higher deprivation, and a greater reliance on pastoral farming.

An issue to consider is whether structural reform could address such problems. Reshaping the system could ensure the viability of local governance in these communities.”

Regarding Regional Councils …

“A question to consider is the place regional councils and sub-council structures (such as community boards and local committees) have in a future local government structure. Regional councils have important functions for resource management, biosecurity, river management and flood control, land transport planning, public transport and civil defence. These functions relate to wide areas often spanning several territorial authorities. A current assumption is that such functions would be difficult, costly and inefficient for territorial authorities to provide separately.

Recent changes make this a good time to test this assumption. With the formation of the Auckland Council, unitary authorities now serve over one-third of the population – a question to consider is whether unitary authorities are useful for organising the local governance of metropolitan areas.”

Regarding relevance of local government …

“One issue is the degree to which local government is relevant to New Zealanders. Local election voter turnout figures suggest that many people do not know about or concern themselves with local government’s activities. From 1992 to 2007, average turnout declined steadily from 61 per cent to 44 per cent, and then rose to 48 per cent in 2010. By contrast, voter turnout at the 2008 general election was 76 per cent.”

Regarding changing local government structure …

“Another issue is the relative difficulty involved in constituting, abolishing or amalgamating districts and regions. Such reorganisation may be needed as communities grow or contract, or when changing economic, demographic and social circumstances make old districts or regions unviable or new ones necessary …

Locally initiated reform is possible, but the infrequent success of proposals suggests that the process acts as a barrier to reorganisation. Creating new districts and regions is a significant move and requires careful consideration, but there may be ways of streamlining the existing process or creating a more efficient process, and providing communities with new or enhanced tools for choosing structures,  boundaries and entities of local governance.”

Importantly, the Hide paper raises the question of whether councils are in fact able to meet “intractable problems” like service burdens and reduced revenues associated with shifting demographics, the need to replace aging infrastructure, and ability to deal with and recover from major adverse and high-impact events.

The paper notes: “These challenges require councils to govern in forward-looking and collaborative ways, attract political leaders who have broad skills and knowledge, and acquire expertise in a range of specialities, such as long-term planning, economic analysis, and information technology.”

Hmmm … I’ll bite my tongue on that one!

The review triggered by this paper will carry on into 2014, with substantive options and consultation not beginning until 2012. However, Minister Hide proposed a number of “open workshops” in the first half of 2011 to begin exploring the issues, with a report back to Cabinet in July 2011. It’s not clear whether this schedule is actually being met.

Nor is it clear what will happen to this review when there is no longer a Minister Hide.

The issues raised are important ones, fully deserving the examination proposed. It would be nice to see this review survive the national election.

Tom Belford

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