Local Government (Management of Local Authorities) Amendment Bill

Thank you, Mr Speaker. I rise on behalf of the Green Party to talk to this bill, the Local Government (Management of Local Authorities) Amendment Bill.

The Green Party will support this bill to select committee. I think it’s really important to improve transparency, and we know that elected members need good advice and information to inform sound decision-making. I think it’s really important that this bill does seek to look at openness and accountability, which is one of the reasons why we are going to be supporting it to select committee, but there are a number of concerns that we do have within the bill that need to be addressed during that process. I just wanted to take a little bit of time to outline those concerns now.

I think one of the things that is mentioned in the general policy statement is that the amendments are intended to, I guess, align governance and management of local authorities with that of the corporate and not-for-profit sector. I think we just need to be a little bit careful, because they are not exactly the same. We know that company directors and officers are legally accountable for the decisions they make, whereas elected members of local councils are protected. There’s a lot of responsibility that does fall on to the shoulders of the chief executive of a local council.

We also need to make sure, when it says here “to minimise the increasing tensions between councillors and senior management … of local authorities”, that this bill will actually be effective. I think, when you look at the Local Government Act and the role of a CEO, that role is to implement the decisions of the local authority. It is to ensure the effective and efficient management of the activities of the local authority. We have seen examples, and they were well highlighted through previous call, of some of the concerns, which is understandable. However, if you read through the Act, those provisions may already be in there, and potentially it’s not an issue with the Act, it’s an issue within the councils themselves that needs to be addressed.

I think one thing to also draw attention to within this bill is clause 5, new section 42(3B), which does not prevent a member of a local authority from obtaining advice from any other person. I feel that this could lead to some unintended consequences of elected members going beyond their role of governance with their interactions with council staff or beyond. What I’m not sure of is who is defined as “other person”, and I’m also not sure where that cost would lie. What we would not want to see is any elected member commissioning reports because they don’t like the advice and that cost falling on ratepayers. I do wonder why this amendment bill, if so important, was not actually included in the system improvements bill that is currently going through the House.

As I’ve said earlier, we do support this, but there are a number of concerns that I have outlined here that I think need to be looked at very closely, because I think it’s really important that, if we do make changes, they actually have a material effect. I do agree there should be no occasion when an elected member has to actually use the Local Government Official Information and Meetings Act to get information from councils. That is totally unacceptable. The question is: that shouldn’t be happening now, with the Act we have, and I don’t know if this bill will actually fix that problem, when it should be addressed by the current Act.

We will support it to select committee, but these concerns need to be, I guess, addressed during that period. Kia ora.

Thank you, Mr Speaker. It’s a great pleasure to rise on another wonderful member’s bill in the name of Stuart Smith— or, as he’s come to be known through his various iterations of member’s bills, “St Stewie”. This is “St Stewie” once again coming to the rescue of another important part of New Zealand’s society and fabric, and that is, when we elect local members to represent us democratically—not appointing people; when we elect them—we expect that that giving of an electoral mandate will come with certain powers and responsibilities.

Now, there is a lot of responsibilities on councillors, and some of the powers that are expected haven’t always come to pass. I think the contribution from the Green member Mike Davidson was actually quite worthwhile in this regard. You would expect that, under the current legislation, local members wouldn’t need to resort to things like the Local Government Official Information and Meetings Act to be able to get information.

But, again and again, we have seen, in this country, local elected members exercising the mandate on behalf of their people being denied information that will help them make informed and responsible decisions, so “Saint Stuey” rides in again out of the dust plains to save the day, and here we are for it.

It’s quite clear that Stuart Smith has taken a responsible path in drafting this bill. He’s clearly identified the difference between governance and management. This is not a bill that will give the ability for elected members, councillors, to reach into decisions beyond their purview, into hiring and direction of local government at that level—they still hold to account the chief executive on behalf of the entire organisation—but what it will do is mean that there is a clear distinction between what they need to govern their local authority and what is expected to be in their purview.

Now, I came into politics at an interesting time in my home city of Tauranga, where we had a period of unelected representation from the commissioners. Now, people have got their own thoughts in the wider New Zealand about that time, For me personally, I was shocked, dismayed, and encouraged to get further into politics because of what I saw happening when unelected, unaccountable people are making decisions in a way that doesn’t reflect the elected role of their community. This Government was able to bring local democracy back to Tauranga, and I was very grateful for it. Jan Tinetti was a great celebrator of having democracy in Tauranga, I know.

Hon Jan Tinetti: I’m pleased the commissioners were there. They were brilliant.

CAMERON LUXTON: We were very happy to see democracy return, as I know we all were. As I said earlier, there were differences of opinion about the commissioners, and Jan Tinetti has given us an example of that right now. I know she celebrated, with myself and Sam Uffindell and Tom Rutherford, that democracy was returned to the people of Tauranga.

Now we’ve got our democracy back, we expect our local members of wards throughout Tauranga to be able to make those decisions with information. I’ve had conversations with elected members in my home area who have had to resort to Local Government Official Information and Meetings Act (LGOIMA) requests to get information. In a place like Tauranga, with a period of commissioners and the trust that was fragilely put on the back-burner, in a way—I’m trying to find a nice analogy—the trust that was taken out of the hands of local democracy. Trying to sort through those issues, it’s very important that we’ve got full and frank and understandable accountability and information as to that time. I was glad to see it.

It’s not just Tauranga. Up and down New Zealand, the story has been repeated. Looking into some of the examples, it was interesting that in a few cases when the Ombudsman has had to get involved about LGOIMA requests and information, there has had to be a requirement for a deed of confidentiality. The very fact that councillors are using the LGOIMA to get information and then have to sign up to a deed of confidentiality to get that information is madness. Well, “Saint Stuey” is here to fix it. I’m glad to support this bill in its second reading. I look forward to seeing it go through the remaining stages of this House. Thank you, Mr. Speaker.

I rise on behalf of New Zealand First to speak in support of this bill, at least as far as the select committee process. I think the intent of the bill is right. There is an issue here. There’s a perception that there is an issue here, and we need to explore that. I’m not sure the wording is quite right it’ll achieve what it’s intended to achieve, but, hopefully, it can be panel beaten through the select committee process.

Look, democracy is supposed to be by the people, for the people. I think that we expect in our democratic process that we have the right to elect our representatives. Of course, we probably are going to have some dispute across the Parliament here about unelected people making decisions around the council table, and that will come back when we get the systems improvement bill At some stage—hopefully in the next few weeks—we’ll have a discussion about that. I hope there’s some consistency here, because there you have some unelected people making decisions on behalf of the ratepayers, not answerable to ratepayers.

The CEOs are in exactly the same space. Time and time again, I read things from people who are commenting on what’s going on in local government, saying, “Well, who actually really makes the decisions? It’s not the councillors; it’s not the mayor; it’s the chief executives. That at least says there’s a perception of a problem, whether or not there’s a reality of a problem. The CEO, quite clearly, is not answerable to us the ratepayer, us the citizen, us the voter, and that is what this is trying to address. It’s that balance of power, if you like.

I can say that CE sometimes probably do carry a lot of the weight. One of the issues we’ve got—and I go back to that systems improvement bill as well—is that, at the moment, we’ve just passed a public sector Act which says that public sector CEs cannot be reappointed; they have to go to the market. At the same time, we’ve got the systems improvement bill sitting there, saying, “Well, at the moment, you can reappoint them for two years. You can have five years, and you can reappoint them for another two, and actually we’re going to extend that for another five.” That is utterly inconsistent between those two bills. It’s also completely inconsistent with what this bill is trying to do, which is to rebalance the power between the chief executive and the council. The council is only elected for three years. The chief executive is appointed for five, potentially plus two—and, potentially, if the systems improvement bill goes through, plus five. Well, who is going to have the power there in that situation? I can tell you what. It tilts the balance in favour of the CEO.

The CEO should be working with the council. Sometimes they don’t, and I think we all know that. The whole idea of saying the CEO is the only employee of the council, the whole idea of that is to say that you can hold them accountable. But how easily can you actually hold somebody accountable who—if you’re going to try and get rid of them because you don’t think they’re performing, that is a really expensive and disruptive process. You can’t reach down to the people who they employ. They’ve got to make that decision rather than the council make that decision. Even if it’s tier 2s and tier 3s, you can’t really reach down to do that. I think there really is an issue there about the balance of power, and that’s what this bill is trying to deliver.

My friend Cameron Luxton said that there’s a separation between governance and management. When I was, I think, fairly early on in my time as a councillor, the point that was made is, yes, there is a separation between governance and management but it’s not a hard black and white line—it’s not a narrow line—it’s actually a bit of a grey line, because when management stuffs up, who wears the consequences? I can tell you what. By and large it’s not management; it’s the elected members who wear the consequences. I can see, Mr Speaker, that you’re actually nodding on that one as well. That is an issue that we really need to think about.

Just to finish off, CEs have an enormous amount of power. Councillors actually, in their own right, have no power whatsoever. What they have is influence. Collectively they have the power, but you actually have to have a council that’s working together. You can have a divide and conquer sort of situation, and I’ve seen that happen in councils as well. Just to finish off, I think this is a worthwhile thing to do, a worthwhile bill to explore. I’m not sure that the wording is going to get it right. I think we do need to have a fundamental review of the whole of the Local Government Act. It’s not just around the CEs; it’s around the expectations that there are of local government. I think this is a worthwhile conversation to have. New Zealand First is going to support this bill at this stage, but I think we can panel beat it to make sure that it actually does the job that I’m sure that the sponsor of the bill wants it to do, which is to try and rebalance the power so that democracy actually means democracy and that the democracy is held by the people that the ratepayers and the citizens and the residents and the businesses of each jurisdiction actually elect to do a job on their behalf and that they can hold accountable, because they can’t hold a CE accountable. I commend this bill to the House.

When we talk about local government, we’re talking about the decisions that shape our everyday lives. It’s the water we drink, the roads we travel, the parks where our tamariki play, the homes we build, the whenua we protect, and the places where our communities either flourish or fall behind. The question before us today isn’t simply whether councillors should have greater authority over chief executives; the real question is this: will this bill lead to better outcomes for our people? If it doesn’t improve the lives of whānau, what problem is it actually solving? This bill says that it will reduce tensions between elected members and senior management and clarify responsibilities. On the surface, greater accountability sounds really sensible. Nobody wants confusion about who makes decisions or who should be held accountable or responsible when councils fail the communities that they serve, but there is a significant gap in this legislation. The Government hasn’t clearly explained why these changes are needed, what evidence supports them, or how success will be measured. Good law should solve a clearly defined problem, not create uncertainty around relationships that have taken decades to build. For Māori, that uncertainty really matters.

Across Aotearoa, councils have developed partnerships with mana whenua and Māori communities through Treaty settlements, through local agreements, through shared governance arrangements, through advisory structures, and years—decades—of whakawhanaungatanga. This bill is silent on what happens to those relationships. Silence isn’t reassurance. It’s not certainty at all, especially when it comes against the backdrop of wider local government reforms that have steadily weakened Māori participation in public decision-making. When Māori have seen Māori wards challenged, Treaty obligations questioned, consultation reduced, and our voices treated as optional rather than essential, we have every reason to ask whether this bill strengthens partnership or simply centralises power.

Te Tiriti o Waitangi cannot become an afterthought in local government. It must remain a foundation of local democracy. One provision allows councillors to seek advice from people other than the chief executive, and that could be positive—could—and it could open the door to expertise from hapū, iwi, Māori organisations, and community leaders whose knowledge has too often been overlooked. But the bill doesn’t say that. It leaves the door equally open to advice that may give little regard to Te Tiriti, to mana whenua, or the long-term wellbeing of our communities, and that ambiguity must be addressed.

If Parliament intends to widen access to advice, then Māori knowledge—mātauranga—and mana whenua expertise should be explicitly recognised within this framework, not left to chance. Te Pāti Māori believes accountability matters, but accountability must flow in every direction. Councils must be accountable to their communities, Governments must be accountable to Te Tiriti o Waitangi, and every reform of local government must strengthen, not weaken, the enduring place of Māori in decisions about our whenua, our wai, and our future. For those reasons, we believe this bill requires greater scrutiny. We want to hear directly from iwi, from hapū, from Māori councillors, from Te Maruata, from local authorities, and our communities about what these changes could mean on the ground and especially to them. If amendments are needed to protect Treaty partnerships, strengthen mana whenua leadership, and ensure Māori representation endures regardless of the Government of the day, then this House has a responsibility to make those changes.

Te Pāti Māori will always judge legislation by one measure above all others and that is this: does it improve the future our mokopuna will inherit from us? Ka mātua i tēnā.

[That will suffice.]

That is the standard that this bill must meet.

E tautoko ana a Te Pāti Māori kia wānangatia tēnei take e te komiti whiriwhiri, ā, kia whai wāhi mai ngā reo o te Māori ki ngā tū kōrero.

[The Māori Party is in support of the consideration of this issue by the select committee, and that the Māori voice engages in the discussions.]

Hello, Mr Speaker. I’d like to tell you a little story that illustrates the importance of a bill like this and the principles behind it. I’d like to talk about Kāpiti Airport. Kāpiti Airport is a real treasure in the region that I represent.

Hon Tama Potaka: A taonga.

TIM COSTLEY: A taonga indeed, the Hon Tama Potaka, and the reason we need it, of all the reasons, the most critical one is about resilience of our community. When the big one hits, which inevitably it will one day, much like Kaikōura in Stuart Smith’s region who brought this bill—I congratulate him on having his brought to the House—much as Kaikōura was cut off to the north and the south, the rail and road links, it was an island within an island, so too could Kāpiti be when Transmission Gully or the coastal road is out of action. We’ve got three almost 100-year-old bridges to the north of us that will see us isolated—that airport will be our lifeline. It’s used regularly by rescue helicopters. It’s used by Life Flight. Wellington Airport is often shut—whether it’s weather, whether it’s turbulence, whether it is maintenance—and all these essential life-giving services come and use our airport. But the airport is owned by some out-of-towners, big corporate company, all funded by offshore money; bunch of offshore money that’s gone into some, I don’t know, Aucklanders that want to cut it up and make a quick buck off the backs of the good residents of the Kāpiti Coast; chop it up into housing and sell it off.

Now, almost no one in our region wants that. We’ve got thousands of new houses going in, many of them through fast-track enabled by this Government, and many other developments going in. Land for housing is not the limiting factor here, but we’ve only got one place for this lifeline utility asset—the airport.

Now, at the moment, there’s another group, apparently Hāpai Property, that wants to come in and build it, chop it up, and use it for housing on the condition that the airport has been shut. Some people have said to me, “Well, it’s privately owned. Why can’t they just go and do that?” My consistent answer is always: privately owned but publicly zoned. If someone wants to change the use of our airport, sure, the owners can sell it to someone else, another group of out-of-towners that want to just turn it into property development, but they have to get it zoned. That is where our council come in. That is where the community have a say, because it is council that will be responsible for that process.

Our community expects to be able to hold our elected councillors to account at the ballot box in two years’ time; to hold them to account for decisions that are made. It is the fundamental principle that says councillors should be accountable for the decisions that a council makes. That underpins this, because I can tell you what will happen now if they try and shut the airport: there will be public meetings, there will be rallies, there will be marches, there will be—

Hon Tama Potaka: Pitchforks.

TIM COSTLEY: Well, I don’t know about the pitchforks—that may be a step too far—but there will be a huge demonstration of support, as there has been consistently for many, many years showing the need for this airport. Anyone that thinks they’re going to come into Kāpiti and just make a quick buck off the airport and shut that thing down should think again.

There is another great offer on the table. I’d love to see one go here that actually wants to keep the airport open. It is out there, but we expect them to look at that, and it is a bill like this that reinforces the core message that it is the elected councillors that are ultimately the ones that govern the chief executive. Yes, those council staff working to the chief executive have a role to play, but the chief executive works under the guidance, the authority, and the scrutiny of our councillors.

Fundamentally, I have many people come to my office in Paraparaumu and say that they’ve got this issue with council, and the first question I say is, “Why don’t you go to the councillors? That’s actually their job.” This bill is about strengthening that it’s their job. We heard from Te Pāti Māori that this is about “centralising power”. No, it’s not.

Oriini Kaipara: That’s not what I said.

TIM COSTLEY: It’s about centralising accountability. That’s a direct quote—a direct quote; she said “centralising power”. This is about strengthening accountability. The public deserve that, when they have a say at the ballot box, they get to hold those people to account.

I take the point that she made that sometimes expertise from various groups is needed. I accept that, and those groups can provide their expertise, and they can provide advice, and they can work with council staff, and they can provide advice to councillors themselves, but it is councillors that should make the ultimate decision and are then held to account. I support a bill like this that strengthens those principles. I commend the member Stuart Smith for bringing it to the House, and I commend it to the House.

Thank you, Madam Speaker. Can I take the opportunity right at the start of this call to congratulate the member Stuart Smith on the bill? It is a short bill, it’s a modest bill, but it does a lot of good for local democracy. As has already been outlined by my colleague Tangi Utikere, Labour is supporting this bill.

We’re supporting this bill because we believe that there are councils across the country where things work really, really well, but there are other councils where councillors and the council as a whole have been shut out of decisions. As has been outlined here this evening, they’ve been refused information and told that their own council’s activities are beyond their own oversight, and that is something that needs to be corrected.

We will be supporting this, but we do have a caution, and again, my colleague has outlined this already. The caution is that there are some sound reasons why there is some information that sits with officials, or some work of the councils that sits with officials. That’s mostly because they come from other Acts, not the Local Government Act, but they come from consenting, building enforcement, licensing, and official information. This Act, and the carve-out in this bill, only refers to this particular Act. We believe that that’s easily rectified, but we believe that select committee needs to test this carefully through the select committee process. I don’t want to hold it up any longer, so I commend this bill to the House.

Thank you Madam Speaker. Firstly, I want to congratulate the member Stuart Smith on this bill, a very good bill which I am a big supporter of. At its heart, this bill answers a simple question: are the elective representatives in charge, or are the officials in charge? This is an issue that we have across local government in New Zealand. You hear about it and see it far too often, we’ve seen cases of it locally. I know, in Tauranga for instance, we have elected members currently on the council having to Local Government Official Information and Meetings Act (LGOIMA) Tauranga City Council to get information out of them. That is an absolute disgrace. How we get into a situation like that, I do not know. But frankly, I want the elected members in charge, because those are the people that that people of Tauranga elected to be on their council, not the Chief Executive, and all the general managers, and everyone else. They do their jobs, they are employed to do their job, the day-to-day operations on it. But I want the elected members having all the information that they need, when they need it, and making the key governance and strategic decisions, and the management below that should carry it out. But somehow in New Zealand we’ve got our self into this situation where the Chief Executive, and the managers are in charge.

They see councillors come, and they see councillors go, and you got long term staff members there that do exactly the same thing. They are the ones that run the show. I can see Cameron Luxton in front of me nodding his head. We hear this too often and I‘ve heard this raised with me recently about the Bay of Plenty regional council—around the Chief Executive there running the show—and it shouldn’t be like that. It frankly shouldn’t be like that. It’s not good enough, and it’s an insult to the democratic process. I thank Stuart Smith for bringing this bill before us.

We’ve seen these other horrendous examples up in the Far North district as well, where the elected members are clearly not in charge of their council. I do not know how we get to this situation; it’s not just one or two councils, it is across New Zealand. Yes, you do have some good councils, but you have a number of them where there is not true democracy, where yes, there are elected members, yes they go in there, but no they don’t have all the information available to them. Staff withhold information from them, staff ultimately make the decisions. I’ve said it before, when you get to a situation where elected members are having to LGOIMA their own council to get information, we’re in a pretty dark state.

This bill rectifies that. It helps go a long wat to making sure that the people elected are responsible to the public, that they have all the information they need, that they have the strategic governance decision making. That also means that councillors get out of the way of the day-to-day operational stuff—because they shouldn’t be in it. They shouldn’t be meddling in that, that is for the Chief Executive and the staff, that is their job.

I remember when this bill was put into the ballot, and I was very supportive of my friend Stuart Smith, we even went and did a small video on it which I was very proud to put up there. ‘Stewie the Saviour’, he’s doing a fantastic job, and I want to commend you on your member’s bill. I am a big advocate of it, I really am. I think this is a wonderful bill. I’m glad to see support from it, from across the House, and I commend this bill.

Thank you Madam Speaker, I rise to take a call on the Local Government (Management of Local Authorities) Amendment Bill. You’ve heard with my colleagues that Labor will be supporting this bill through to Select Committee. This bill inserts a new section, 41B, into the Local Government Act 2002, providing that the council activities are managed by the CEO, subject to the direct supervision of the governing body. We know that elected members of councils across the country are elected by their local communities. It is important the activities of management are clearly defined also with elected members who have been voted in by their communities. It is important that through that democratic process, elected members, when they are given some information, they actually need all the information to make correct decisions for their local communities. This bill will progress through to the next stage. I want to thank the member, Stuart Smith, for bringing to the House. It is as short bill, you have heard my colleagues, I commend this bill to the House.

Thank you Madam Speaker, and thank you to all of the speakers tonight, and Tangi Utikere from speaking a couple of weeks ago on this bill. There’s widespread agreement, which very seldom happens in this House, but it’s great to have—people do understand why I brought his bill. Just to go back to the history of the actual Local Government Act, this came about where essentially the responsibility for the council sits with the Chief Executive, not with the elected councillors. That came from an English model, and that was the genesis of it, that was why the power sits there. A framework matters, because if you get the frame work right, everything else falls out from underneath that, and you get a good functioning entity, but the framework isn’t right. That is why I brought this bill.

The amount of feedback I have had from that first reading speech a couple of weeks ago has been phenomenal. I’m still getting messages from councillors and former mayors saying “Spot on” and “You’ve got this right”, all that sort of thing. But I do take on board some of the comments from those around the Chamber, who have pointed out that this is a very simple bill—it’s only a few lines. So that means we have to get those words exactly right, and I accept that and I think we’ll be able to tease that out through the select committee.

But I want to talk about a couple of things. I note Mike Davidson from the Green Party seemed to be quite concerned that it was aligned with the Companies Act, but the Companies Act is also how charitable trusts, and other good governance is run—based on those principals which is simply putting the power with the elected councillors. That’s what the people expect. The reason this has struck a chord with people in the public is because they get it. They completely understand what this means, it’s not some complicated technical thing that we normally see in legislation, it’s very simple, but will be very effective. Cameron Luxton—from the Act Party, my friend, who’s just sitting right here—talked about the commissioners in Tauranga, and how they’ve now got a democracy back. This really matters. It matters because local government is what people interact with everyday. The streets that they use; the water that they get; the sewerage; all off that stuff—all of that local stuff—that seems quite boring, but actually, when it doesn’t work, those people notice. When their rates bills go up, they notice.

All of that comes down to good governance, we have councillors who—if you’re being unkind, you’d say that they merely turn up to rubber stamp the decisions that are being made behind the doors by the officials. And there’s a bit of truth in that, and that needs to change. That can’t change with the way the rules are now. A lot of councils are high functioning, they don’t have these issues at all. But because the framework isn’t there in the right way, it can develop quite quickly and cause the problems that we’ve had. The fact that’s been traversed by many other’s tonight, about how councillors have had to use the LGOIMA—or the Local Government Meetings and Information Act—is actually shocking that it would get to that stage. And that sometimes, they have gone through that Act and been refused access to those papers. It is their right to do it, it is their information, it is not the information of the officials. You can’t make decisions if you don’t have the information. It is wrong, and it needs to change so that those councillors that we elect will be able to be out, when they run their next election campaign, on what things they can do, because they will be able to do them, rather than being hobbled by a poorly functioning—

Hon Member: Hobble’s a good word

STUART SMITH: Yes, I think it is appropriate, I think it’s apt—hobbled by the people that are supposed to serve them. And with having information, rather than it being filtered by the people that they manage—or oversee—they will get the information that they need. I thank all of the members in the House who’ve spoken this evening, and I commend the bill to the House.

Referral to Select Committee