Local Government Act 2002 Amendment Bill (No 2)

Members, we now turn to the Local Government Act 2002 Amendment Bill (No 2). The question is that Part 1 stand part. I call the Hon—

Nanaia.

CHAIRPERSON (Hon Anne Tolley): —Nanaia Mahuta.

That’s OK. It’s 9 o’clock at night—

CHAIRPERSON (Hon Anne Tolley): It’s been a long day.

—but I thought I should preface Supplementary Order Paper (SOP) 323, that will be debated, and provide a bit of a synopsis of some of the changes that we can anticipate will be debated in the committee of the whole House stage.

The bill as amended by the Government SOP makes a number of improvements to the local government system, implementing the changes in the SOP, and will assist the Government in working constructively with local government to improve community wellbeing. This Government is progressing the bill to demonstrate its partnership approach to working with the local government sector. Reform will not be imposed centrally, but will be addressed in conversations with local government to ensure that both arms of government are working together to benefit local communities. In fact, when I gained this particular role, one of the strong messages from the Local Government New Zealand sector group was that they wanted to work more in partnership with central government on the key issues facing them.

The bill will provide an opportunity for the Government to set a clear signal of intent as to how it will support the local government sector to address the challenges which communities face. It will remove the threat of amalgamation from local authorities by restricting reorganisation requests to local authorities, the Minister, or those receiving community support, requiring a petition of at least 10 percent of local electors to proceed. It was most concerning that many of the amalgamation questions that the Local Government Commission (LGC) were addressing actually didn’t pass the test, and we’re going to improve that through this particular amendment.

In terms of council-controlled organisations (CCOs), the Government SOP removes the focus on enabling CCOs to provide core council services previously in the bill. Instead, new tools are provided to help councils govern CCOs and to provide better accountability and reporting mechanisms. CCOs are accountable to local communities through councils that control them, and we can do more to improve transparency and accountability. Powers for the Local Government Commission to create CCOs through the local government reorganisation process are removed.

In terms of Local Government Commission changes and the reorganisation process, the bill implements stage one of a reform programme for LGC and its role in the local government reorganisation process.

At this point, I just want to acknowledge the former chair the late Pita Paraone, who had a brief but important role in chairing the LGC.

There’s no foreseeable need for large-scale local government reorganisation such as amalgamations in the near future, and the changes that we’re putting through will, I think, give greater definition and more functional contributions of the LGC. Greater powers for the LGC and greater accountability to central government are removed. The LGC should not have a greater role in local authority reorganisations. Interim measures are introduced to constrain large-scale reorganisations, to alleviate the local government sector’s concerns about the threat of amalgamation—and I’m sure, tonight, they will be very pleased to hear that—and to provide breathing space while new arrangements are being developed.

The bill will require that the support of 10 percent of electors is needed for an investigation to commence in response to a request from the community. The LGC will have discretion to decline to investigate. This will ensure that only reorganisations that have significant community support will be investigated. It replaces the current settings that, effectively, require the LGC to investigate a reorganisation application made by an individual.

The bill enables a reduction in the number of commissioners below the current requirement of three. If the anticipated reduced workload enables a reduction, temporary commissioners will start to be able to be appointed, as and when required. If there is a single commissioner, the Minister of Local Government will make the appointment in consultation with both Local Government New Zealand and the Minister for Māori Development.

The power of the LGC to initiate an investigation is removed from the bill. Accountability to central government is removed, for example, through the annual work programme and annual reporting requirements. The Minister of Local Government’s power to direct the LGC work programme is removed, as is the ability to set detailed performance measures and expectations. The transfer of the LGC staff out of the Public Service is removed. Flexible reorganisation processes in locally led organisations were generally supported by the local government sector, and these are retained. The bill contains appropriate transitional arrangements for reorganisation investigations that are ongoing at the date of enactment.

In so far as CCOs are concerned, provisions promoting the use of multiply owned CCOs to deliver core council services are removed. The detailed funding and financing arrangements for multiply owned and substantive CCOs are also removed. The bill improves accountability and transparency settings relating to CCOs. Planning and reporting mechanisms for CCOs will be enhanced.

The bill requires local authorities to publish CCOs’ statements of intent and annual reports on their websites. This is an important step forward in terms of transparency. These provisions are enhanced by extending the requirement to CCO half-yearly reports. Reports must be published within one month of their receipt. Local authorities have the power to defer the statutory time line for preparing and adopting a statement of intent for their CCOs by up to one month. This enables the local authority’s long-term plan to be prepared first and it informs statements of intent for the CCO.

Councils are also empowered to specify additional planning and reporting requirements for a CCO, including requirements to prepare asset management plans, long-term plans, and thematic plans such as climate change adaptation and mitigation plans; to report progress against any additional plans, as appropriate; and to report progress against its statement of intent quarterly rather than half-yearly. The bill also enables a local authority to set out a statement of expectations for a CCO, specifying how it should undertake its operations.

The provisions relating to CCO obligations to Māori are retained, and local authorities are encouraged to address the issue of CCO relationships with Māori. When appointing to a CCO board, a local authority must consider whether knowledge of tikanga Māori is relevant to the governance of that CCO.

Provisions relating to the shift for Watercare, the Auckland water CCO, from infrastructure growth charges to development contributions are withdrawn. The prohibition on infrastructure growth charges may have inhibited Auckland Council’s capacity to borrow and, consequently, to provide for future growth. These matters will be considered as part of future work on development contributions and targeted rates under the infrastructure funding and financing work stream of the Urban Growth Agenda.

There are some minor changes. The SOP removes provisions in the bill relating to non-financial performance measures. It also removes provisions which impose financial performance measures relating to financial prudence requirements. The current provisions for regulations to set parameters and benchmarks are retained. Clause 30A of Schedule 7 is amended so that ex officio members of a council joint committee are excluded from the quorum count. This helps to remove a small but important problem for the operation of joint committees.

That’s a brief prelude to the Part 1 component of the bill, but can I say that I’m grateful to the Local Government and Environment Committee for their consideration of the SOP and ensuring that a thorough assessment of the changes aligned to what we were hearing from the local government sector. That’s an important thing, because one of the things that this Government has done is assure many New Zealanders that we’re serious about engaging with local government and working with them to ensure that the legislation that governs them is fit for purpose and does address some of the sharpest challenges.

Can I say this: in terms of the CCO improvements, it is a step towards what we really want to achieve, which is greater accountability to the shareholder councils of how CCOs operate. Again, I know that the consideration of the select committee on these particular issues was done at a time when there was some anxiety around the water reform work that I was leading and how the sector was perceiving the potential use of multi-CCOs. We’re not in that space. We’re going to change up the conversation with local government. We’re going to ingest greater transparency in some of the core areas to which they delegate functions through CCOs, and we’re going to change up the conversation around the issues to do with how councils work together, which is why we’re improving some of the functionalities of the Local Government Commission.

Madam Chair, thank you for the opportunity to take a call on the Local Government Act 2002 Amendment Bill (No 2) in the committee stage. Can I begin, because we are talking about local government, just to acknowledge those candidates who are standing for local government in the elections. The election date will be 12 October, so I’d just like to acknowledge all of those who are standing. Hopefully, we’ll have an increased diversity within our councils.

There are two key points I want to pick up on, and I’ve got some questions for the Minister of Local Government. The first one is around the amalgamation, and the second one is around the council-controlled organisations (CCOs). In terms of the amalgamation aspect, obviously this bill and Supplementary Order Paper 323 remove the threat of amalgamation from local authorities by restricting reorganisation requests, requiring a petition of at least 10 percent of local electors in order to proceed. So it’s a fairly high bar. Basically, it means that somebody must have a petition with at least 10 percent of the local electors in order to trigger a discussion about amalgamation.

Now, my question there to the Minister relates to collaboration versus amalgamation, because the word “amalgamation” is, I think, to be fair, probably a little bit of a dirty word among councils. We had a discussion recently across the Waikato region where I think it was the CEO of the Waikato Chamber of Commerce, Chris Simpson, in the public domain, said “Look, let’s have a chat about amalgamation.”, and there was some quite strong backlash against that, with the councils quite strongly saying, “We do not want to amalgamate.” However, on the flip side, those same councils who strongly said they do not want to amalgamate have been collaborating very well on one particular project, and I’d like to highlight it and alert the House to that project—and the Minister knows about it. It’s the Hamilton to Auckland corridor work. We’ve got the Hamilton—

CHAIRPERSON (Hon Anne Tolley): Can we focus on the bill? This isn’t a general business session; it’s a particular piece of legislation.

Thank you, Madam Chair. So my question to the Minister relates to the fact that—how does she encourage collaboration without having amalgamation? The example with the Hamilton to Auckland corridor is where councils have collaborated, how do we foster that—so, how does the Minister plan to foster that—without forcing that aspect of amalgamation on them?

CHAIRPERSON (Hon Anne Tolley): Fine, fine, but could you address the legislation. This is the committee stage, where we look at the detail of legislation and discuss that. So a general question to the Minister about what she intends to do, without actually relating to a piece of legislation, is a bit difficult for the Minister. I’m sure she can handle it, but, you know, stick to the topic.

Thank you, Madam Chair. So the councils are collaborating together.

The second aspect is around the CCOs and around the transparency. The bill clearly makes CCOs more accountable to local communities through the councils that control them, and so how does the Minister intend to increase that transparency, and how does the bill increase that transparency in terms of the CCOs. With particular relation around infrastructure, because the Minister, in her opening speech, spoke about water, and the fact that for councils, the delivery of the three waters reforms is a key aspect. Many of the councils are interested in CCOs, but how do the CCOs work?

I’m also interested in the Minister’s comment around an Audit New Zealand report—which covers this—around the transparency. The Audit New Zealand report says “It is also important that the local authority carries out its statutory functions well, to provide the foundations for an effective relationship. In particular, the local authority needs to: be clear about the purpose of its CCOs; appoint the right people to govern each CCO; and meet the requirements for monitoring and accountability.”—so, linked to that aspect of transparency and how it largely depends on an effective relationship between the CCO and the local authority and how that relationship plays out in general practice.

So the aspect of amalgamation—how councils collaborate without amalgamating—and, secondly, the transparency aspect in terms of CCOs, and particularly around the three waters reforms, which the Minister alluded to, because that is a topic that is certainly front of mind for our councils. Thank you, Madam Chair.

It’s my pleasure to take a brief call on this. Can I acknowledge you, Madam Chair, and the Minister in the chair, Nanaia Mahuta, for her work on this bill and Supplementary Order Paper (SOP) 323, because both of you have been involved previously and now. I do want to start off by saying that we support the bill, obviously, but we do have some concerns about the SOP, which I’m going to outline briefly.

I think it’s widely accepted in New Zealand that most people are resistant to large-scale reorganisations—and the Minister clearly articulated that—and I think that’s probably where most people in this House would be as well. Although I do question where, in fact, the Minister is trying to go with the SOP, because on one hand she is, rightly, reducing the role of the Local Government Commission (LGC) but still leaving it there with one member, minimum—and there can be more; I accept that—but also taking away what I would call the proactive role of the LGC and then offering an alternative model of engagement in sort of another part which we don’t know.

The issue I struggle with in that scenario is this: unless there is a proactive body that is an agent of the Government, then there is no effective way of recommending, supporting, and looking at change objectively, apart from through the lens of the Minister’s eyes. As somebody who has been involved in some change processes—the one that didn’t go too well in Hawke’s Bay, although I still believe it was right—I do want to acknowledge that there is a role for an independent organisation to prod around some of these things.

Minister, the problem I have with your SOP is that you are referring to only stage one, and we know very little about what follows next. I understand you’ve been having conversations with the sector, and I understand they would be nervous, because, Minister, with respect, the three waters reforms that you’re looking at could have a very profound impact on the role of local government, what it does, and, effectively, the scale of its operations. So if we are to change how we deliver water, or the three waters, and if we are to do it more collaboratively—and I acknowledge, as the previous speaker, Jamie Strange, has just said, that there are some councils in New Zealand that are working quite collaboratively. But in my experience, when you get down to the nuts and bolts and the real hard stuff that involves a lot of money or assets, it gets really, really difficult. I can’t see yet, Minister, in what you’ve announced, how you’re going to achieve that, and I worry that by taking away some of the proactive roles of the Local Government Commission, there is no other driving force for any substantive change. Now, the Minister may have some in her thinking that we’re not aware of.

I do not accept for a moment that council-controlled organisations are a bad thing, either. In many cases, they deliver a very good service, and in many cases they are quite accountable. They are not councils, though. They are, effectively, more corporate-type organisations running the business of a council, and they have a different role. They are deliberately like that to bring a more business-type focus to running the business of council.

In my view, with what has been outlined here in this Supplementary Order Paper, you might as well do away with the Local Government Commission in totality, and you might as well set up a separate agency to deal with electoral boundaries and ward representation every three years, because as I look through this, I can’t see a legitimate role for the Local Government Commission. One person, maybe a few more—I’m saying, why bother? We don’t want to be disruptive in this piece of legislation, because we support the main body, but we are concerned that the Supplementary Order Paper drives away an agent of the Crown to, effectively, intervene and to suggest some change. Without that, we cannot see—apart from direct ministerial intervention from time to time, or instruction—how the Government can ask things to be considered differently. Thank you, Madam Chair.

Thank you, Madam Chair. Thank you for the opportunity of speaking at the committee stage on this bill. Look, it’s really good to see engagement from across the House on key issues, and it’s also encouraging to see general support from members opposite on this bill. It is in particular that I would like to look at some of the changes proposed around council-controlled organisations, or CCOs, and to look at some of those areas and ask a couple of questions to the Minister in the chair, Nanaia Mahuta, in this space.

The provisions within Supplementary Order Paper (SOP) 323 aim to improve responsiveness to local authority direction. They also aim to improve transparency in this area and, in addition to that, to enable iwi and Māori to have greater input into how CCOs are being run—better public responsiveness and responsiveness to Māori. This is achieved in a number of ways in the bill.

I’d just to use a particular example from the Hutt Valley, where I reside. We have a CCO that’s been operating there for a good while, and it has really concerned me in terms of how it has been operating and how it has been transparent. So I’m interested to know from the Minister in particular whether these changes will mean that a CCO will have to operate with those wellbeings in mind—the new four wellbeings that we’ve applied to how local government will be operating. So the example that I’d like to use to illustrate this point is a CCO by the name of Urban Plus that operates providing cheaper housing in the Hutt Valley. What they do is they own a number of properties—particularly for people over 65—and they are rented out at 90 percent of the market rate. But what’s been happening lately is that they’ve pretty much got into the role of property development, where land is being purchased, built upon, and sold at market rate, and a profit has been made and then pocketed, which is what happens.

But what I would’ve always liked to have seen is, at a time when there is such desperate need of increased housing opportunities in the Hutt Valley, Urban Plus taking a far more hands-on role in terms of assisting to deliver more affordable homes for families across the Hutt Valley. So I’ve always been interested to know how we could have greater transparency and a greater responsiveness to the needs of the community for an entity that is under the general ambit of our council. I look forward to understanding a little bit more how this would impact upon my own area.

Some of the SOP’s key changes to CCOs, I note, are that the Local Government Commission will not be able to transfer council services to CCOs. In addition to that, there are proposals to create an elaborate system of council-controlled organisations to deliver water, transport, and other services. That’s withdrawn as well by the Supplementary Order Paper. There are also provisions added to enhance the transparency and accountability of council-controlled organisations to councils and communities. As someone who has attended an annual general meeting of a CCO, I think the whole meeting was conducted in about 2½ minutes flat. So I would like to also know what types of public accountability—how people in the community can find out about what the business of CCOs is and how they can be involved in understanding what that work is and how it benefits the wider community, if at all.

So I’m really encouraged to see a Supplementary Order Paper that looks at taking an area where I think additional benefits could be seen by the community, and I’m very interested in finding out a little bit more in terms of how those things in particular can work to operate, alleviating big, long-term issues such as those of housing in the Hutt Valley that we see. So, thank you, Madam Chair.

It gives me pleasure to speak. I’d just like to compliment the previous speaker from across the floor, Lawrence Yule, who I know was personally involved. He spoke of local government amalgamation—or attempted—and, having watched very keenly during attempts to amalgamate in the Hawke’s Bay, I think it was a learning experience for many other organisations or many other local bodies around the country.

But I’d like to particularly go to proposed new section 24AA in clause 8, which is around the purpose of local government reorganisation provisions: “The purpose of the local government organisation provisions of this Act is to promote good local government by enabling and facilitating improvements to local governance.” Well, what a lofty ideal, and anything that starts any piece of legislation should have a core principle, a first principle, similar to that, that we should be aligning and templating against any other decisions that are made.

After that, of course, it comes to proposed new section 24 itself, in clause 9, which really discusses the scope of local government reorganisation, and it goes through there: “Local the reorganisation may provide for 1 or more of the following matters:”. I think, if you go through those matters, going through to paragraphs (g) and (n), from the union of districts and regions—now, I think I’m very fortunate to be the member of Parliament for Ōhāriu, which only has one territorial local authority, one council, and one mayor for that whole area—

💬 Kieran McAnulty: One good MP.

—and—thank you—as Mr McAnulty very kindly pointed out, one fine MP. So I thank you for that, Mr McAnulty. But “the constitution of a new district or region, including the constitution of a new local authority”—these are all things that have to be taken into account. It is good that they are laid out there, because I think we all know that in New Zealand, from the time it was settled, communication wasn’t what it was, transport wasn’t what it was, and very small communities, communities now that we look at and we think “Was that really an organisation that had its own CEO—had its own council?”

They were very small, and we don’t have to go far from here. Look at Pētone. It was a place at the bottom of the Hutt Valley, and not only did it have its own council but it had its own traffic force, as did many of these local councils, because they were actually a very good source of revenue. Now, looking historically back at it, it’s very important when we’re looking at clauses like section 24 that as we go through these provisions, we have some context for them. As I read through, this is one of the contexts I think is a good one to compare as we go through, as to why you would ever have thought that the local body—you go through an area that, literally, you can drive through now in five minutes as one heads up the valley. In less than five minutes, you’re through that area that did have to take into account all these things: its own water, its own sewerage, and not at some small expense—all those things.

So now, as we look at all those small councils long forgotten, I’d hope that in archives somewhere, people can go back and look at some fine people that worked very hard to keep them. But logic said that they should at some stage move into a much bigger body, and this is where we’re going back to section 24. We go through paragraph (c): “the abolition of a district, including the dissolution or abolition of the local authority for that district or region:”. I think I’m reminded of the phrase “turkeys voting for Christmas”, because often when these things have had to be done and we’ve had to abolish local bodies, it has meant that those who have actually put them through have gone without a job. Someone’s had to step back and leave the running of their area to a much bigger organisation.

That is something we can look at in Auckland, to see the provision up there of the single authority produced in Auckland. I know there is still some debate about whether that has worked, and I’m sure it’s a debate that will go on until perhaps Auckland may become even bigger than it is now. I would not imagine that I will ever see the day when it would actually become smaller and narrower—as I see you are requesting that I do in relation to this speech, Madam Chair.

So I will actually continue down the alphabet until I get to paragraph (g), which is: “the performance and exercise by a local [body] of both—(i) the responsibilities, duties, and powers of a regional council in respect of a region;”—and, of course, again, the roles of the region and moving towards whether we’d ever have a unitary authority. Isn’t that a word that is entering our lexicon now—“unitary authority”?

I just want to take a brief moment to respond to some of the questions, and in no particular order.

There was some conversation around the role of the Local Government Commission (LGC). Can I just reiterate, in my opening remarks and in response to the member across the Chamber, that the changes in relation to the Local Government Commission represent the first part of reforming the independent role and function of the Local Government Commission, and were more attuned to what, in the current environment, the independent nature of the LGC could look like. But it was still important to retain some key functions—for example, ensuring locally led reorganisations—to ensure that the LGC was able to focus on representation reviews and boundary changes, and the establishment of local boards and community supported reorganisations as per the changes in Supplementary Order Paper (SOP) 323. So, while I hear the concerns of the member, now is not the appropriate time to set out what stage two will look like in terms of the functions of the LGC.

But can I say this: it is important that there is a body that has a level of independence that can undertake some roles and functions that could improve and give confidence to the sector in a number of areas, some of which are already well-known and are kept; some, in terms of greater transparency, governance, and capability, that we are still yet to think through. So I don’t want to leave the impression that the whole focus of the LGC is starting to be eroded or minimised—that is not the case. What we are ensuring is that stage one of retaining the current functions and, I guess, raising the threshold to initiate amalgamations or reorganisations is something that actually works for the community.

The other thing that I wanted to comment on is in relation to council-controlled organisations (CCOs), and commercial CCOs in particular. If we look at some of the challenges within Auckland and the transparency and accountability of those CCOs, we need to continue to ensure that the provisions around CCOs can give greater line of sight to the shareholder—to the council—about what they undertake on behalf of the council area. Many members across this House will have heard a number of concerns from the community about how commercial CCOs lack the level of transparency and accountability for the functions that they undertake, and I think we can do better in that space.

So I wanted to signal that as an important point to note, because, again, the SOP seeks to change a bill that we inherited. The changes that we will continue to go down will ensure, again, fundamentally, greater transparency and accountability for the role and function of CCOs, and that there is an independent role for LGC—this is stage one of that change process.

I’ll come to the question that was raised in relation to how we foster collaboration if amalgamation is not the preferred approach of this Government. Actually, in the space of water reform, that is a fertile area within which we will see local government leadership about how they discuss their arrangements for improved service delivery, and we’re encouraging that. But the more, again, that we can encourage local government to come up with the solutions themselves, rather than central government pushing a particular approach, I think we continue to gain trust that we are working with the sector, and that’s a partnership that the Prime Minister has been leading.

Without detracting too far from the legislation in terms of the points that were raised by my colleague Greg O’Connor in relation to proposed section 24 in clause 9—very well pointed out, may I say—and it only amplifies the points that I’ve been highlighting around the scope of local government reorganisation and the roles and functions there.

I think that there are real opportunities to extend this conversation in the space of the transparency of CCOs.

Thank you very much, Madam Chair. It’s a pleasure to speak to Part 1 of the Local Government Act 2002 Amendment Bill (No 2) and, in particular, to Supplementary Order Paper (SOP) 323 introduced by the Minister, a not in-substantive Supplementary Order Paper which makes some reasonably fundamental changes to a bill that was introduced by the National Party when they were in Government.

I have to say I’m surprised at the lack of participation in the debate this evening from the National Party, because this was their answer to the infrastructure deficit that does exist—that does exist. [Interruption] Oh, they’re getting noisy now. Take a call, lads. Take a call if you want to participate in the debate. But this was their answer to the infrastructure deficit in local government, and we do know many councils suffered from years—decades, in some cases—of a lack of investment in fundamental infrastructure such as water services, transport, and roads.

CHAIRPERSON (Hon Anne Tolley): The Minister is getting to the bill, isn’t he?

The Minister is going to get closer to the bill.

CHAIRPERSON (Hon Anne Tolley): Part 1.

At the core of this were council-controlled organisations (CCOs). Madam Chair will recognise CCOs, multiply owned CCOs—CCOs that cover multiple councils. This was the answer that was presented by the National Party when they were in Government. That was a central part of Part 1 of this bill, which has been changed by the Supplementary Order Paper introduced by the Minister of Local Government, the Hon Nanaia Mahuta, to remove the definition of multiply owned CCOs and to remove that concept from the legislation.

I know that many submitters came to select committee and expressed their concerns not only about the lack of transparency, the extra layer, and the distance between the voters and their democratic right to control the assets owned by their council on their behalf by CCOs but the concern that the creation of these multiply owned CCOs that would control infrastructure across a number of councils could create an incentive for a Government that was so minded to embark on a privatisation regime creating a significant asset that was at arm’s length from the council—already partially corporatised, it’s not a big step then to take the next step to privatisation. That was a significant concern of many submitters, and that is, I believe—and I would appreciate some clarification from the Minister if this is the case—part of the motivation for removing those multiply owned CCOs from this legislation.

But also on this side of the House we do not necessarily believe that the corporate mentality, the corporate approach, is the right approach or is a better approach for controlling what are, essentially, monopoly assets. You’re not going to get competition in water services, whether it be the provision of drinking water or the treatment of waste water. This is not a business proposition. This is not something where you’re going to have multiple actors competing against each other to provide the best service to the public. This is, by its very nature, a monopoly service, and, by and large, on this side of the House we believe that the services that have monopolistic characteristics like that are best provided by the State or by some other public entity—in this case, the local council—because that gives local control over local assets and provides democracy and transparency, whereas what you get when you have private control of monopolistic assets is often price gouging, because there is no competition. There is no one else to create an incentive to drive down prices or to make sure that they are run in the most efficient way, and what ends up happening is the private owners take the opportunity to generate as much income and often—I heard someone on this side saying—asset stripping. That occurs as well.

So the claim from the one member opposite who has deigned to participate in this debate so far that taking a corporate approach results in more efficient, more effective delivery of public services—[Bell rung] Madam Chair.

CHAIRPERSON (Hon Anne Tolley): I call the Hon Lees-Galloway—Iain Lees-Galloway.

Yeah, “Lees-Galloway”—to my friends. It is, I think, demonstrably wrong and we have multiple examples of this happening not just in New Zealand but around the world as well. “Private” and “corporate” do not automatically mean better, and in this case, when you’re delivering public services, monopolistic services, that are a fundamental piece of infrastructure required by everybody living in a community, on this side of the House we believe they are best delivered by public entities and with public control—not the arm’s length, council-controlled organisation, but actually owned by the council under public control.

I notice that one of the provisions which have been changed by the Supplementary Order Paper is to remove the requirement to align the objectives of a CCO with the priorities of central government. So not only was there a privatisation agenda behind some of these changes but very much an agenda of central government takeover of locally owned assets, and this is a great concern to many councils—that they fall under central government. There are often regulations and laws passed by us in central government and they are expected to deliver on them, but they certainly are concerned about central government agendas impacting on their ability to deliver local services.

So, again, I’m very pleased to see that the Minister has introduced the SOP that also does that. It’s absolutely securing the role of local councils as the owners, the operators, and the controllers of that local infrastructure.

I don’t think my voice will last a heck of a lot longer, so I will just finish by saying that I support the SOP introduced by the Minister. I have to say, given that this was the Opposition’s great answer to these issues when they were in Government, I am surprised that we haven’t heard a more vehement defence of their position in this debate. Clearly, they’ve realised that this side of the House is right and they were wrong all along.

Tēnā koe, Madam Chair. Thank you very much for this opportunity to contribute to the robust debate on this bill as it proceeds through the house.

I have a couple of questions that I’ll lay out throughout my contribution. The first one, if I can—and I know this is something in particular that the Minister is certainly well versed in, if you like. But I’m curious, when we look at the bill being proposed, when you look where it says “After section 17(4), insert: (4A)”, and then it goes down a long list after it says, “In assessing the benefits and negative impacts of a proposed transfer under subsection (4), a local authority must have regard to the following matters:”. I know the Minister touched on it briefly in her first contribution, and I want to go all the way down to paragraph (e), because in that particular part it says, “existing communities of interest, and the extent to which the proposed transfer will maintain linkages between communities (including iwi and hapū) and sites and resources of significance to them.”

Now, for those who have even a short time of experience in this House, one will know that whenever we start looking at those kinds of interests of hapū and iwi and how we might protect them into the future, one can’t help but ask the questions about are we doing enough to make sure that their particular interests are being considered. I know it’s a rather big part there, but when we consider the way iwi and hapū consider resources of significance to them, I’m curious as to whether or not—

CHAIRPERSON (Hon Anne Tolley): Sorry to interrupt the member, but we’re just having difficulty finding the clause that you’re referring to—just to help the Minister?

I’m reading here, in clause 7, “After section 17(4), insert: (4A)”, and then it goes all the way down a very long list. Like I say, the Minister mentioned it briefly at the beginning, and I always like to take the opportunity in this part to ask a question, a couple of simple questions, because I think they’re relevant. One, as tribes have settled across the country, I, in my short time in the House here, have noticed strong parts of legislation that allow them to be actively involved in local government. I think those are important, because much of that actually relates to the way resources are looked after and the way sites of significance and other things are managed. The other part to that which I think is fringe but relevant is actually the way hapū and iwi consider other communities who partake in those resources, who live within those boundaries. It’s those kinds of questions that I always like to ask when we look at including clear words—like in this particular instance, where it says “(including iwi and hapū) and sites and resources of significance to them.”

Another part of that is the same question I ask in other times when I see this, where it does talk about tikanga and history and what it means to them. But, like I’ve already mentioned, the Minister has already made it clear that in her work on this particular part—if she can, perhaps, explain it a little bit more, because it does cover some of it in there, but it just makes it a very clear part in the one that I’m talking to because earlier, you’ll see, Madam Chair, that in proposed section 17(3A) it does talk about those Treaty of Waitangi claims. But as that process evolves, I’m wondering if there are any implications on that.

Before I take my seat, the only other one that I wanted and hoped that the Minister could provide a little explanation on was that it says, in clause 5(2), “In section 6(1), insert in their appropriate alphabetical order:” and it goes through, and it flips over to page 12, and it includes in there “or Greater Wellington Rail Limited”. As an Aucklander, I’m always curious why in there it says here it does not include the “Auckland Transport”—and OK, that’s fine. I’m just curious as to why it says “or Greater Wellington Rail Limited”. That’s perhaps what a Māori would term kūare, but I’m hoping that the Minister will at least indulge me in helping me understand why that particular part is in there when I consider also that the original bill has “Auckland Transport” as well.

I call—oh, gosh, it’s one of those nights.

💬 Clayton Mitchell: Clayton Mitchell.

CHAIRPERSON (Hon Anne Tolley): I call Clayton Mitchell.

That’s all right. I forget my own name sometimes—

CHAIRPERSON (Hon Anne Tolley): It must be getting awfully late.

—it’s totally acceptable. Thank you, Madam Chair.

I rise to take a call on this very important bill. It’s actually this very subject that got me into politics at the start, because the role that local government plays in our everyday lives, arguably, probably plays in some people’s lives more of a role than what central government does because they have so much to say about the things that happen directly in our communities. I think over the years we’ve seen some departure from some of those responsibilities that have been bestowed on to local councils, territorial authorities, and regional councils, and this bill acts to tidy up some of those anomalies.

I just would like to say that, I guess, it’s been quite refreshing hearing the support from the other side, although the other side hasn’t supported Supplementary Order Paper 323.

💬 Kieran McAnulty: Not much.

But the best support you can hear is when they’re actually not saying too much, Mr McAnulty. So I’ve actually enjoyed that silence because silence is golden, and there’s a lot of smart words in nothing when it’s not being said.

I’d just like to raise a point about the council-controlled organisations, and this is the part that I think steps out as being quite a pivotal move. What we want to see is openness and transparency and the autonomy for a council to operate, but in an open and transparent way. I think on many occasions we have seen councils opt for a council-controlled organisation set up to obfuscate—is my word—their responsibility to manage and administer what are core functions of a council. When you look at local roads and the connector roads in your cities and regions, when you look at swimming pools and parks, when you look at halls, and when you look at the waterways and the three waters—the waste water, the sewage, and your drinking water—and you have situations where councils set up an organisation that is put behind a firewall and that is funded by ratepayers but without being able to have that openness and transparency, it creates some concerns. This actually tidies that anomaly up.

It also constrains and puts a tightening up around the fiasco which was the amalgamation of the super-city in Auckland, and we saw the problems that that has caused. This bill here, in this Part 1, takes away the ease in which a council could look at amalgamating with other territorial authorities and other regional councils, etc., which I think doesn’t prevent it from happening, but it makes it quite difficult for that process to be undertaken. I think that’s quite an important part as well. We need to learn from the mistakes of our past.

But the key function, I think, of this bill really is around ensuring that those council-controlled organisations don’t get put into a box out of the reach of the eyes and minds of the ratepayers, and therefore I think that that’s to be commended in this bill overall. I did spend some time in local government. As I say, there are frustrations that seemed to build up in a community by not being listened to by their elected members, but more frustrating is when they have been elected to do a job and then that job has been passed on to a board of independent people, where the funding is put into an organisation that is then not able to be managed by the governing body that has been elected to do so, which is irresponsible.

Another aspect that I think is very good with this bill is it also creates some autonomy around the Local Government Commission—

I’m sorry to interrupt the member, but the time has come for me to report progress.

House resumed.

The Chairperson reported the New Zealand Infrastructure Commission/Te Waihanga Bill without amendment, the Kāinga Ora—Homes and Communities Bill without amendment, and progress on the Local Government Act 2002 Amendment Bill (No 2).

Report adopted.

The House adjourned at 9.57 p.m.