Local Government Act 2002 Amendment Bill (No 3)

on behalf of the Minister of Local Government: I move, That the Local Government Act 2002 Amendment Bill (No 3) be now read a third time. On behalf of the Minister it is my privilege to say that with this bill the Government has taken the final major step in delivering the Government’s Better Local Government programme announced in 2012. In the last 2 years this Government has delivered two bills to this House to reform local government. That is a testament to the dedication and effort of all of those who have been involved. Local government reform was needed to make sure that all public services, not just those in core public sector departments, are delivered in a cost-effective and efficient manner. The council infrastructure, on which we all depend, needs to be built and maintained to a standard that supports the current and future needs of New Zealand communities. That means making far-sighted decisions and careful financial management. This bill helps deliver the tools to do the job.

With housing pressures on the rise, even more focus is needed to make sure that all the costs of building new homes are kept under control. Development contributions were introduced in 2002 and, despite being an important funding tool for councils, they had not been reviewed for 10 years. Through this bill the Government has worked hard to develop and enhance the scheme so that it benefits ratepayers, councils, and property developers, all of whom have a stake in the growth of our communities. Most important, it is fair to new homebuyers. This bill puts measures in place to ensure development contribution fees are charged for infrastructure only where the need for that infrastructure was created by new developments. Contributions should not be used by councils to fund those “nice-to-have” amenities that the rest of the community would benefit from and should therefore contribute towards. The new definition of “community infrastructure” in this bill places limits around what types of infrastructure can be funded by development contributions. This change does not mean that councils will stop building and maintaining community infrastructure. Community infrastructure was being built by councils in the many decades before development contributions came into existence. If anything, the change should incentivise councils to deliver community infrastructure in more cost-effective ways.

Getting a balance between supporting existing communities and ratepayers, while encouraging the growth of communities and the economy, is vital to the future of New Zealand. I believe that new provisions in this bill help to achieve that balance. New provisions for participation in council meetings via audiovisual link for both the public and council members recognise that the local government sector must evolve with the times. For this, future-focused and prudent management of council-owned community infrastructure is vital. Council-owned infrastructure can often have a 50-year to 100-year lifespan. The current 10-year long-term plan provides an inadequate time horizon to manage these types of assets. The introduction of a 30-year infrastructure strategy will go a long way to enhancing the strategic management of those assets. The Government and the Local Government and Environment Committee took on board council suggestions to improve the proposed infrastructure strategy. The amended provisions of the bill anticipate that the 30-year infrastructure strategy will focus on each of the first 10 years and then the remaining 20 years in 5-year blocks. This will allow councils to think ahead to plan for likely scenarios without imposing an unnecessary administration burden by requiring detailed year-by-year financial and circumstantial estimates.

This bill allows a balance to be achieved by providing good strategic planning tools without placing an unnecessary administration and cost burden on councils. Good strategic planning is an important ingredient in the success of any organisation. However, it is also important for stakeholders to understand what is planned without being overloaded with detail. It is with this in mind that changes have been included in this bill to streamline the way in which councils consult with their communities. This Government is not removing obligations to consult; we are providing for more efficient consultation. Councils will have the flexibility to consult at an appropriate level for the topic that is being consulted on. This creates a better balance between cost-effective decision-making and good community consultation on the things that really matter. Specialised consultation documents will summarise councils’ plans and make it easier for the public to understand the critical issues and projects in their community.

The bill lays the legislative framework to encourage and facilitate council collaboration to deliver more effective and efficient public services. Councils are increasingly working together to keep service delivery costs down for ratepayers. This bill takes that positive work one step further to clarify accountability, risk, and liability surrounding joint agreements in order to realise the full potential of this type of collaboration. This legislation has stayed true to the goal of the Better Local Government programme to create a more efficient and more cost-effective local government sector. It assists with the wider suite of programmes aimed at improving housing affordability. It will ensure that New Zealanders are provided with quality public services and it will make sure that councils and their infrastructure are well prepared in supporting our communities for decades to come. I commend this bill to the House.

Debate interrupted.