Tasman District Council (Validation and Recovery of Certain Rates) Bill

Having had a pretty good go at the preamble of the Tasman District Council (Validation and Recovery of Certain Rates) Bill—

💬 Maggie Barry: Oh, only getting started.

Well, we are only getting started because the preamble has a good deal of the description of the bill, but really this bill comes right back to council processes and decision-making processes within the council. I think that the Committee understands what has happened here that brings this bill to the House, which is that back in 2003-04 rates were incorrectly set and now need to be put right, because if they are not put right, then, in fact, those rates would be deemed to be unlawful and the council would be open to challenge.

I just want to take a moment to reflect on the decision-making responsibilities of any local authority in New Zealand and on how important it is that those requirements under the Local Government Act and the Local Government (Rating) Act are adhered to closely and carefully, because if they are not, then you are going to end up in the kind of state that the Tasman District Council and others—mercifully few—have found themselves in. So it is really incumbent on the chief executive of the local authority to make sure that the calculations and the information put in front of elected members are correct, so that when members do go to vote on the rating declaration, there are the maps attached that describe the rating boundaries for the purpose of targeted rates and that sort of thing.

So although I am absolutely sure that the elected members of the Tasman District Council have taken quite a bit of heat over this, how much liability do you place on them? You know, as an elected member—and I was an elected local authority member—I ask how much is it your responsibility for making sure that the resolutions that are placed in front of you for voting on are correct, and how much of that lies with the council officers. Well, I have a view on that. I reckon that although councillors need to make good, robust decisions, they have got to be made based on good evidence and good information, and clearly in this case those councillors made a decision a number of years ago that was not based on good information and good evidence.

I think that that is exactly what underpins the purpose of the Better Local Government reforms brought in by this Government. This kind of example just absolutely underlines exactly why we need local authorities that are capable, that are proficient, and that are focused on what matters. Around rates-setting time what matters is putting good information in front of the elected members so that they can have a good debate about what they are about to vote on, because the voting that takes place in every local authority has an impact on rates and is taking money out of ratepayers’ pockets to provide them with services.

Part 1 of this bill, which is the preliminary provisions, describes in detail the purpose of this bill, which is to “validate specified rates set and assessed by the Council and the penalties added to those rates;” and it is the penalties where things get quite tricky for the—

💬 Chris Hipkins: This is possibly the most boring speech I’ve ever heard.

You see, the member over the other side of the Chamber has just said that this is possibly the most boring speech he has ever heard in this Chamber, and I think that that is really unfortunate, because this matter is quite important to the people of Tasman District. I think that those ratepayers of the Tasman District—which electorate is it? Which electorate is the Tasman District in? It is in West Coast - Tasman and maybe a little bit of Nelson. So let those ratepayers listen to what just happened from the members of the Labour caucus. They are finding this debate, which is about providing good governance on behalf of their local authority, boring. So I do hope that those people who are listening and watching this on television clearly understand that if they are looking for any sympathy from the Labour caucus for local government, then they need not look to Labour. Clearly, the member from the other side of the Chamber, who has no knowledge about local government and clearly no love for local government, has just absolutely displayed to everyone here that those members have no sympathy, they have no empathy, and they have no liking for local government.

I think that that is a shame, because local government underpins our communities and the provision and the setting of rates, if done correctly, is absolutely critical for every single community. It does not matter whether it is Wellington or the West Coast - Tasman—it does not matter where it is. It does not matter how boring that little process is that the councillors have to sit down and make the resolutions on, just as we do sometimes. It is about as dry as a chip, occasionally. It does not matter how dry and boring it might seem to those Labour members; actually, it matters. It matters to those ratepayers because it is their money that is being taken out of their pockets by their council to pay for services that they need.

I reckon that Labour has just laid its intentions bare. Those members do not care. They think it is boring. Well, I tell you what: the National Government does not think that it is boring. Through our Better Local Government reforms we are putting a huge amount of focus on providing good services in local government. You see, over on this side of the Chamber we want to provide—it might be boring and it might be as dry as a chip—

💬 Maggie Barry: That’s democracy.

—good service and, as Maggie Barry says, that is democracy. Sometimes it is a little bit dry and not that exciting sitting down and reading lots and lots of papers, and I can understand why the Labour members would not like that—

The CHAIRPERSON (Lindsay Tisch): Order! Now I would actually like to hear something about Part 1. We are actually on the parts of the bill now, and the parts are quite limited. I am asking the member to talk about Part 1 of this bill.

Thank you so much, Mr Chairperson, because this comes right back to the purpose of this bill, which is to correct the deficiency with the Tasman District Council. I think it would be fair to say that correcting mistakes made in the past is exactly what this Government is focused on doing through its Better Local Government reforms. I acknowledge that members on the other side of the Chamber, Labour members in particular, find that a bit boring, but I can assure the Committee that we do not.

I would like to take just a short call on Part 1 of the Tasman District Council (Validation and Recovery of Certain Rates) Bill because it is a short part of the bill. We have talked about the preamble, which covers most of the issues that we are dealing with. Part 1 actually outlines the purposes of the bill, which, to recap, are to validate the specified rates and the penalties added to those rates, to collect any rates or penalties that have remained unpaid, and also to validate the more controversial part of this bill, the Ligar Bay and Tata Beach stormwater rate for 2006 and 2007. Part 1 also lists the definitions used in the bill, and they show us the large number of rates that have been set incorrectly. Yes, they are technical breaches and they are procedural errors, but it has required a lot of time, a lot of energy, and a lot of money to bring this bill to Parliament so that those rates can be validated. Yes, it is a necessary process, but it is wasteful of council resources, and when you talk about council resources, what you really are talking about are ratepayers’ resources.

The member who sponsored this bill, the Hon Damien O’Connor, in his previous speech to the Committee made a very important point to the Tasman District Council. Local councils should be responsive to the ratepayers whom they serve. They should avoid disputes with those people whom they are set to look after. They should try to deliver what the communities want, when the communities want it. This validation bill would probably never have come to the House if it were not for the dispute between the Tata Beach and Ligar Bay ratepayers and the Tasman District Council. Perhaps that could have been dealt with in a more cost-effective way if everybody had been on the same side. But this was a dispute that escalated, and, in actual fact, everybody from that escalation—the council, the Ligar Bay and Tata Beach ratepayers, the ratepayers for the wider district, and Parliament—were all the losers in this process.

Let us hope that this council and others can view this bill as a bit of a cautionary tale. Councils should remember that it is their responsibility to provide efficient, effective, and affordable services to their ratepayers, and so they need to treat their ratepayers with respect and work with their communities. The members of this Committee have reluctantly supported this validation bill. They are supporting it because it is a pragmatic and sensible decision and it will benefit the ratepayers of the greater Tasman district area.

It is my pleasure to speak on Part 1 of this Tasman District Council (Validation and Recovery of Certain Rates) Bill. The Tasman district is a wonderful part of the country. I have not spent a hang of a lot of time there, being based in Auckland—

💬 Kris Faafoi: Whereabouts?

—based in Epsom—but I have had the opportunity to spend a little bit of time there, and it is a wonderful part of the country.

I just want to go through some of the preliminary provisions and the purposes of this bill, particularly: “to—(a) validate specified rates set and assessed by the Council and the penalties added to those rates; and (b) treat all money received by the Council in payment of the specified rates or penalties added to those rates” in order to fix what was a mistake made when certain rates were incorrectly set during the 2003-04 period through to 2008-09. As you would have heard, Mr Chair, in previous speeches, without validation the council does remain vulnerable to legal challenges from ratepayers over the incorrectly set rates. This part is focused on trying to fix that problem.

Certainly, my experience in Epsom, as in most areas, is that rates are a subject that a lot of people get very concerned about because they are not linked necessarily to an ability to pay. They are based on capital value, and older people on a fixed income, in particular, find it very difficult to cope with that. People have a very keen interest in making sure that the rates are as low as possible, but they also obviously have a very keen interest in the fact that they are set lawfully and properly. Unfortunately, in this instance in the Tasman District Council, under the oversight of Damien O’Connor as the local MP, things did not quite go right. This bill is aimed at trying to sort that out. National wants to give affected residents the opportunity to engage, and is therefore supporting the bill, and we have made good progress.

I just want to go through the interpretation clause, because this really drills down to the meat and drink of this bill. We are talking about clause 4, “Interpretation”, which states that in this bill, unless otherwise required—we are coming up with a definition for the 2003 rates. Let us look at 2003. Of course, that was really the start of the second term of the former Labour Government, when it was basically maintaining a reasonably disciplined approach to spending but was about to start increasing Government spending, which was to lead to the very significant increase in Government spending overall. I accept I am moving a bit away from this bill, but it was a period I think when New Zealand was doing extremely well. We did not really make the most of that opportunity because the Government just expanded its own spending, rather than leaving money in the pockets of hard-working New Zealanders in order to grow their own businesses and make jobs.

If we move through to the 2004 rates, which is on the next line here, it means “the rates set out in the funding impact statement adopted by the Council for the 2004/2005 financial year”. Again, if we look at 2004, that definitely was one of the years that the locusts consumed, because New Zealand was doing very well, but in Auckland in particular we saw house prices really start to rocket, based on—[Interruption]

The CHAIRPERSON (Lindsay Tisch): Order!

Sorry, I will move back to 2004. If we go on to—[Interruption] Sorry, did you want me to start again?

If we go on to 2005, we will be looking at “the rates as set out in the funding impact statement adopted by the Council for the 2005/2006 financial year”. Again, 2005 was when the Tasman District Council started to get into serious problems because the rating information that it laid down was incorrect.

Further on, if we look at the 2006 rates, it means “the rates as set out in the funding impact statement adopted by the Council for the 2006/2007 financial year;”. The problem with that was it was in this particular period that the technical mistakes were made, which are being fixed by clause 9, which we dealt with previously. But it was there that the technical mistakes were made, and the rates were levied incorrectly, and that led to this legislation, really, which is all about trying to get the right form of words and get it done officially so that the people of Tasman can move on and have some certainty around this area.

There are no particular winners out of this legislation, because nobody is happy about having to do retrospective legislation in this way. But, in the end, if the council is tied up in endless litigation, then that costs everybody. If, for some reason, the people whose rates were levied incorrectly do not pay their rates, that just means that everybody else in the district has to pay those rates, and that is unfair to them. And so the correct thing is to ask whether if it were not for the technical mistakes that were made, those rates would have been properly levied, and, therefore, this legislation really just recreates that situation.

I will just move on to 2007 and 2008. Those two years were also in error, and this bill is trying to correct those problems. It is interesting that this piece of legislation interprets the term “Council” to mean the Tasman District Council. That is a reminder of specifically which council we are dealing with in this legislation. The funding impact statement has the meaning given by section 5 of the Local Government (Rating) Act. These two places are Ligar Bay and Tata Beach, neither of which, sadly, I have ever been to. I have been to Golden Bay, if that is in the same district. I think it is. But those two bays, Ligar Bay and Tata Beach, are the two particular areas that we are talking about, and that is what this part relates to.

Overall, I just want to say, finally, that National’s Better Local Government reforms are aimed at helping make local government more efficient, responsive, and well focused. This legislation and this part are not what you would describe as a critical part of that overall framework, but it is a bill that highlights to other councils the importance of proper scrutiny when setting rates. On that basis, I think I have said enough, so thank you very much.

Part 1 agreed to.

Part 2 Validation and recovery of certain rates