Estimates Debate — Vote Local Government
Tēnā tātou katoa. This speech will focus on an egregious failure of our parliamentary system in relation to the responsibilities of the Minister of Local Government. A select committee dealing with matters of vital interest to local government, the Auckland Governance Legislation Committee, has been diligently working up and down the country, and it has been held to ransom. Money has been squandered and the process has been undermined. Every day, up and down, in and around the broader Auckland area, people have been told by that Minister, the Hon Rodney Hide, that their issues not only would be addressed but also could be considered and successfully resolved once they participated. The Minister did not like the nature of the participation. He has abused the system. That member has been here since 1996. Sadly, although in earlier years he sought to make himself out as a valiant defender of the parliamentary system, he has used it now for his own miserable, wretched, short-term political purposes to try to cause his party and his profile to grow on the back of racial discord.
Of course, that will not save his bacon. However, it will enable him to reward the interests that he has been sent here to advance in terms of local government. There was every right for members of iwi and the broader Māori community in the city of Auckland to expect that this Government and this Minister would give them a fair go. There was $5.5 million spent on the Royal Commission on Auckland Governance. There were countless submissions, numerous hui, meetings, and deliberations, and they have all been swished aside on the basis of the Minister’s personal political short-term agenda.
Paul Quinn: Your $5 million!
Hon SHANE JONES: I know we will be warned to stick to the topic, but that interjection was from one of the Māori members who has refused to stand up and be counted. This is a bad day for local government in relation to Māori. At least with Tau Henare, we know what he thinks. The fact that he reflects what he thinks is causing him to be very unfavourable with the party he is in.
Māori have been shut out, and Mr Hide is well and truly aware that this agenda of his is cruel to young Māori voters. It has also been demonstrated that he is no defender or ambassador for the interests and the system of this House. It is quite simple. There is major legislation, the implementation of which will be funded by the budget that he has stewardship over, but he has written out of the script at least 50 percent of the population in terms of the partnership principle under the Treaty of Waitangi. He does not care about their interests. I can understand how he would think it was relevant to humiliate and undermine the Māori Party, but he did not need to do that; its members are doing that to themselves, and I will have more to say about that later.
There was a host of very impassioned and well-informed young and old participants, and they have been shown that democracy in Auckland will not work for them. That man does not want it to work for them. He has a narrow agenda, and it does not include the interests of the Pacific Island communities. In fact, he is totally disinterested in the diversity and the pluralism that make up Auckland. He has a very narrow Epsom-centric approach. His stewardship of this portfolio has hit a low ebb in terms of all the previous members who have had to rise to the occasion and be good stewards of this particular role.
When we go forward, there will be more legislation to come back to this Chamber. But it is sad that money is being put aside to drive that local government agenda. There has been a very divisive and gross slur placed upon the tangata whenua of Auckland. They have been told there is no place for them under the views of that man, that there is no place for them under parliamentary procedure, and that there is no place whatsoever for them in the pact that has been entered into between the prevailing major party of the day and Mr Hide. It is highly likely in the short term that his stewardship of this portfolio will be lauded by the deeper corporate interests of Auckland, but that is not an adequate basis to run the super-city. The super-city has to be about people. This man has turned his back on the people.
The CHAIRPERSON (Eric Roy): I just want to say that this debate is about the estimates. I think the Hon Mr Jones, the previous member who spoke, might have referred occasionally to them, but the substance of his remarks was an attack, which did not really focus on the estimates. I want to draw the debate back.
I shall spend a little while addressing what the Minister of Local Government, Rodney Hide, has done and the trouble he has caused. Watching his performance over the first 9 months was like watching Yes, Minister. He makes courageous decisions, and, unfortunately, the Prime Minister has not seized the wonderful opportunity he presented to him only this week. When a Minister puts his or her head on the block, the chopper should be got out—that is what should have happened. We could have had two Ministers from Epsom gone in 3 months. I think that would have been rather good. This Minister not only is not treating Māori properly—and it is not just in Auckland; it is across the country—but he is treating the mayors and the councillors throughout New Zealand in a way that is not very satisfactory at all.
We have a Minister who wants to bring things back to narrowing local government down—core business. This is going on as he runs it as a smokescreen for what will happen to Auckland. Why did that Minister not proceed with a referendum after the royal commission made its report? Why did that Minister run away from making a referendum a part of Aucklanders having their say? That Minister has his hands on a big chunk of money, and he could have done that. Yes, I am talking about money, Mr Chairperson. That Minister has control over it. He could have got someone else to go along to Cabinet for him and argue for a referendum. He could have talked to the Minister of Māori Affairs not just about what was going on in local government; he could have made sure that not only do they get a fair go when it comes to representation but also a fair share of the money that that department has. I think that one just cannot isolate one from the other.
The Minister was going to keep rates down, as well. There are lots of people who have received their rates demands in the last few months and who have found out that rates are going up. It is interesting that the opportunity that he talked about before the election, that he talked about as soon as he became Minister, and that he wrote about to mayors all over the country has not resulted in very much pleasure in terms of local government. He talked to the mayors of Auckland, he talked to Bob Harvey, he talked to Len Brown, he talked to Calum Penrose, and they are all disillusioned that they have a Minister of Local Government who is hell-bent on his agenda and will not listen.
I am really sad about that, because I thought Rodney Hide, as a Minister dealing with a big budget, would do something. I thought he would listen to people. But, of course, it helps to be listened to by the Minister if one is a Pākehā—he will listen a wee bit. But if one is a Māori, it seems that his or her views are swept to one side. When we hear people in the Chamber today asking the Minister of Māori Affairs what he is doing and we see that they have to work together—how cruel can one get! What is happening is that two people are being sent away—one with the ammunition and the other with an empty basket. We have a Minister who has his own agenda and it is supported by the Prime Minister, John Key. He supports it. He is not supporting the Māori people of Auckland. He is not supporting Māori people throughout New Zealand in having a say in local government. [Interruption] Of course, there is one of the Māori members from National calling out. Why does he not cross the floor? I invite him to cross the floor, but he will not have the nerve.
First of all, it is really pleasing to be here as Minister of Local Government.
Hon Member: Didn’t think you were going to make it!
Hon RODNEY HIDE: Thank you. Let me please see if I can respond to that very sustained, incisive, and critical attack on the estimates of Vote Local Government in the time available to me.
It is good to have an opportunity to highlight the key areas of interest in the Local Government portfolio. In particular, following on from members who have previously spoken, I want to focus first on the work being undertaken to reform local governance in Auckland. To put it simply, if Auckland’s economy thrives, New Zealand’s economy thrives. That is why the Government is so determined to set up governance arrangements that enhance the productivity and the competitiveness of Auckland’s businesses.
Second, I want to talk briefly about the work I have directed to improve local governance transparency, accountability, and financial management. There is much good work being undertaken by local councils, but I am convinced that we can do more and that we can do it better without burdening ratepayers further.
The Government has moved quickly to respond to the recommendations of the Royal Commission on Auckland Governance. Working to strengthen Auckland’s governance is one of the key areas of the work of the Department of Internal Affairs in local government in 2009-10, and beyond. This work is critical not just for the prosperity of Auckland but for the country as a whole. The Local Government (Tamaki Makaurau Reorganisation) Act 2009 was enacted in May—and I thank Labour members for their support in this—to allow implementation of the new structure to get under way. That Act established the Auckland Council and formed the Auckland Transition Agency. The Auckland Transition Agency is empowered to design, to establish, and to manage the transition from the existing eight councils to the new core local governance arrangements for Auckland by October 2010, in time for the next local body elections. Budget 2009 included funding to facilitate the establishment of the Auckland Transition Agency and the board. The department has assisted with the set-up of the agency and has developed a framework for monitoring its performance. The Local Government (Auckland Council) Bill, the second piece of legislation, was introduced in May. That bill provides for the high-level structure of the Auckland Council and allows for the determination of boundaries and the membership and number of local boards.
Aucklanders have recently had the opportunity to have a say on these important matters. Over 2,500 submissions were received by the Auckland Governance Legislation Committee on the Local Government (Auckland Council) Bill. The committee is expected to report back to the House by 4 September, with an enactment expected by late September 2009. A third bill will be introduced late this year to provide further detail on the governance structure, functions, roles, and powers of the Auckland Council and its local boards.
That bill is expected to be enacted in either May or June 2010. Over the coming months the department will be developing detailed policy for the third bill on issues relating to water, transition issues, interim arrangements, the ongoing governance framework, and advisory panels for ethnic and Pacific people. Work is also being undertaken by other agencies relating to transport, planning, economic development and key projects, waterfront development, and social development. Some of this work is needed for the third bill.
Over recent years there has been widespread concern about the growth in local authority rates and the choices some councils have made in their funding decisions. There is strong evidence that rates have been growing faster than local authority input costs. The Government has agreed, therefore, to review aspects of the Local Government Act to improve the transparency, the accountability, and the fiscal management of local government, which is something I know the Hon Shane Jones is vitally interested in. I want to ensure ratepayers and citizens have better tools for controlling the cost of council rates and council activities, and I will be looking at ways to ensure local government operates within a defined budget and focuses on core activities.
The review is not about prohibiting local government from doing things; rather, it seeks to enable the sector while at the same time providing greater opportunities for the involvement of ratepayers and citizens in authorising what is done on their behalf. The review is guided by the following principles: first, that local government should operate within a defined fiscal envelope—that is to say, a budget; secondly, that councils should focus on core activities; and, thirdly, that council decision-making should be clear, transparent, and accountable.
The review will look at how to make local government’s long-term planning processes less complex and costly, and look at ways in which each council’s financial reporting can be improved to provide better and more readily understood information. Firstly, the department will be working on options for simplifying long-term council community plans and making them more strategic. This will reduce councils’ costs and ensure that ratepayers have access to material they can understand. Officials will also consider mechanisms for plain English financial disclosure and for developing comparisons between councils. Secondly, we will look at where the changes are needed to the current requirements around community outcomes. Officials will examine options for a more focused and less costly service performance system. Finally, the work will also look at ways of enhancing councils’ accountability to their ratepayers and citizens. I believe that some councils go ahead with expensive projects without gaining a clear mandate from ratepayers. Officials will consider options for the use of referenda to ensure councils have a mandate for those projects.
That is a very hefty work programme, and let me, with your indulgence, Mr Chairperson, take a minute to also say how wonderfully I have been served by the officials of the Department of Internal Affairs. I could not ask for better people, in terms of their intelligence, their experience, their insight into local government, their commitment, and the hard work they have provided to the Government and to me in particular as a new Minister in getting this work stream under way. I consider myself truly blessed to have such a wonderful team assisting me, and I think all Governments are very lucky to have had people of such—
Hon Steve Chadwick: Creating another grievance.
Hon RODNEY HIDE: I hear Steve Chadwick jumping up and down about creating another grievance. I have three words for her: foreshore and seabed. Thank you very much.
We have heard a whole lot about Auckland today, and as an MP from Christchurch I want to talk about local government right across the country. This Government’s priorities are to grow the economy and create prosperity, and with that to provide security and opportunities for all New Zealanders. Effective local government is an important part of this equation.
A critical issue for many New Zealanders is managing their rates payments. Rates are increasing and are placing a bigger burden on ratepayers, who are already stretched in these difficult economic times. In the past, rates have risen much faster than inflation. From March 2001 to December 2008, under the previous Labour Government, the consumer price index for all groups increased by 23 percent, but the consumer price index rates subgroup increased by 61 percent over the same period. This level of rates increase is totally unsustainable, and it is no wonder that ratepayers were in revolt.
The problem is significant because rates are the single-biggest source of council income, and the costs of local government continue to increase as the demands and expectations of citizens outstrip the ability of ratepayers to pay. The result is that many councils are struggling to meet their statutory commitments. They are struggling to provide for the necessary infrastructure and services that their communities demand. An analysis of data from the newly released long-term council community plans shows that the upward trend is continuing. Despite efforts to keep the costs down, inflation, growth, and community expectations continue to generate increases. The projected cumulative increase in rates income over the next 10 years is 59 percent, and at the same time public debt for the sector is forecast to increase by 100 percent and operating expenditure by 37 percent. These figures are unacceptable and they are unsustainable. Something has to change, and this Government is absolutely focused on finding ways to manage the cost of rates.
But in the meantime the Government, responding to the pressure from struggling low-income homeowners, of which there are over 110,000 this year, has allocated $65 million out of the total funding of $90 million for Vote Local Government—that is, 72 percent of that funding—to the Rates Rebate Scheme. In 2008-09 the average rebate was $483. These changes will lift the maximum rebate from $530 to $550, and raise the income threshold for eligibility from $21,180 to $21,910.
But this is only a stopgap measure. It does not address the real problem. We must find ways to control council costs, capital expenditure, and activities, and to improve the transparency, accountability, and fiscal management of local government. We have heard the Minister pledge today to do just that. Over recent years there has been widespread concern about the growth of local authorities and the choices some councils have made in their funding decisions. Ratepayers and citizens want to be given better tools to be able to have their say in what is done with their money and on their behalf. After all, ratepayers have to carry the consequences of expenditure decisions by their councils, so it is only fair that they have a greater say in council decision-making. We are looking to simplify the long-term council community planning process. It is enormously expensive, with some councils spending up to $1.3 million just on doing the planning every year. We want to develop plain-English financial disclosures, so that every ratepayer has at least a chance to understand where the money is going. We want to streamline the compliance processes. Thank you.
I shall address my initial comments to what should have been the bright, shiny new centrepiece of the Government’s local government programme of work. I am talking about the Auckland super-city. This should have been a bright new day for local government in Auckland, and instead it is turning to custard, and it is only August. First is the question of local boards. They were a blunder, an ill-judged and ill-advised decision made in the heat of the moment, presumably by the Minister of Local Government, that caused a backlash by Aucklanders—
Paul Quinn: I raise a point of order, Mr Chairperson. It is with some reluctance that I interrupt the address by my learned colleague and friend Phil Twyford, but I think we have reached a point where numerous Labour speakers in the estimates debate have taken the opportunity to canvass much wider issues.
The CHAIRPERSON (Eric Roy): I think I know where the member is going but that is not the way to raise a point of order. It is not an opportunity for a speech, and Speakers’ rulings state clearly that points of order should be made tersely. I think the member was about to say that the speaker was straying from the debate.
Paul Quinn: Yes.
The CHAIRPERSON (Eric Roy): Now we have got to it. This debate is theoretically about the Government’s spending and estimates, and the Chair has shown some tolerance and allowed some opportunity for members to bring in illustrations, etc. The member should draw back to talking about estimates expenditure. He can exercise his mind as to how he might bring in the points he wants, but they need to be connected to Government expenditure.
PHIL TWYFORD: I shall focus my comments on the money and resources that have been expended over the last 6 months on the exploration of Auckland governance reform. I have talked about the boards and the backlash that that provoked in the Auckland community. The second point is that the proposal of the Minister of Local Government for a quota of “at large” councillors on the new Auckland Council has put the Government under enormous pressure, because public opinion has now decisively rejected that proposal. The third key plank in the Government’s super-city model, regarding Māori representation, has left the Government and its coalition partners in disarray, whereby members of the Government are subjecting themselves to name-calling and abuse in these corridors.
Today the newspapers say that leading figures in Auckland local government are appalled by rumours of Government decision-making on the question of the northern boundary of the Auckland super-city, and the negative planning and environmental effects that that would have on the super-city were it to happen.
So why is that very important project in tatters, even before the select committee has reported back to the House? I say to members opposite and to the Minister in the chair, the Hon Rodney Hide, that they should look in the mirror and ask themselves why Aucklanders feel so disillusioned and so despondent about the way the super-city project has been handled. The process has been deficient. Money has been expended wastefully every day of every week for the last 6 months by Rodney Hide, from the day that he released his own pamphlet, which was less than 2 weeks after the tabling of the report of the Royal Commission on Auckland Governance. Then we saw the process ride roughshod over the National Party’s manifesto promise to consult Aucklanders. We saw the first super-city bill being bulldozed through the House. We saw the denial, the confiscation, of Aucklanders’ right to a referendum under the Local Government Act. Now we see an ongoing fear that the super-city project is not only about curtailing the voice of local communities and corporatising our democracy but is a prelude to privatising our assets.
In the last few days the select committee, which is such an important part of our parliamentary process, has been reduced to a farce because the Minister of Local Government and the Prime Minister pre-empted the decision making and deliberation of the committee. Two people are responsible for this parlous state of affairs—
Hon Steve Chadwick: Debacle!
PHIL TWYFORD: —this debacle, as my colleague says. The first person is John Key, the Prime Minister. He is the man who wants to be everybody’s friend or tell everybody what he or she wants to hear, but he seems incapable of providing the leadership. The second person who is responsible in this estimates debate for such gross mismanagement of the local government programme of action is Rodney Hide, the Minister of Local Government. He is actually exercising too much leadership. For a man who represents a party that is capable of summoning 1 percent of support in the poll, he is the tail that wags the dog; or, as a commentator said this morning, he is the tail that bites the dog.
Jacinda Ardern: Tails don’t bite!
PHIL TWYFORD: This one did. This is a tail that bit the dog.
The Minister of Local Government claims to be the champion of ratepayers, and I quote a number of things he said on Q+A not long ago: “I don’t think it’s about me getting my way.”, in relation to the super-city. He said it was ultimately not up to him; it was ultimately up to the Parliament. The reality is something quite different. Mr Hide has got his way every step of the way.
I rise to make a contribution to the estimates debate, and I say to the members of the House that councils should be about communities, not corporations. Mr Hide’s Local Government Act reform is about gutting local government and clearing the way for the privatisation of income-generating assets and services. Those assets and services were built up by ratepayers over many, many years. Many people in Māngere would find the words used tonight by the Minister in the chair, the Hon Rodney Hide, in referring to accountable and transparent councils, to be hollow, when we consider that the Auckland reform disestablishes the eight local councils in Auckland and instead establishes the Auckland Transition Agency, made up of people who are not elected by the people but appointed by the Minister and accountable only to the Minister.
Local Government New Zealand is critical of Mr Hide’s suggestions about core services, and we ask Mr Hide how he defines core services. We ask whether housing for the elderly is a core service or whether social housing is a core service. We ask whether community art is a core service. We ask whether social well-being or cultural well-being is a core service. We ask whether economic and environmental well-being is a core service. We ask about Māori participation, Asian and Pacific participation, and, indeed, youth participation. All of those things currently exist in local government throughout Auckland, and it appears that the Minister is attempting to get rid of those things.
Yesterday Radio 531 PI invited callers to express their views when a caller complained about an Auckland billboard that states: “At least our brownies won’t eat your pet dog”. Pacific callers were outraged at the insensitivity and racism that those remarks portrayed. This is 2009, we say, and still some people in New Zealand—and I have to say, with the greatest respect to this House, they are mainly Papalagi—cannot seem to live in one of the world’s biggest multicultural cities without making derogatory remarks about people’s race or the colour of their skin.
Then again, we heard that Mr Hide was prepared to throw his toys out of the cot because he could not support race-based seats. Yet Māori see themselves as New Zealanders, as Kiwi, not as a race. Māori are mana whenua, tangata whenua. We have Māori of Samoan ancestry, and Māori of Tongan, Cook Islands, Niuean, Indian, and Pakistani ancestry. We even have Māori of Dalmatian, Scottish, Welsh, and English ancestry. Some of them are good-looking; others on the other side of the Chamber may not be. All of them see themselves as home-grown Kiwis who are proud to be New Zealanders. Those are the people who make up local government in Auckland. All of them share a vision of being inclusive. They recognise that we each have great strengths, and that we would be a better country if we accepted that Māori have a special place in our history and in the culture of Aotearoa, but, more important, they recognise that if Māori are not included in local government decision-making processes in this country, then we perpetuate the minority view that what is European is best.
I say to members that is not the view held by the majority of the people who live in the Greater Auckland region. Pacific people are united in our support for Māori and for Māori seats on the Auckland super-city. Manukau was one of the first local councils to establish Pacific advisory committees, and they exist today. That was followed by the establishment of such committees in Waitakere, Auckland central, and North Shore. Those advisory committees exist today, and they desire to be part of the future Auckland super-city. We know that if Europeans were able to recognise the strength of Māori, then they would be more open to recognising the strength of Pacific and Asian people in all facets of New Zealand decision-making. The Pacific Island advisory committees of Manukau, Auckland central, Waitakere, and North Shore all advocated strongly for there to be Māori seats on the Auckland Council. Organisations and individual submitters who represented people from the Cook Islands, and from Samoa, Tuvalu, Niue, and Tonga all supported the establishment of Māori seats. Pacific people were prepared to sacrifice their own ambitions regarding the super-city in order to ensure that Māori were treated with the mana and dignity that they deserve to be treated with in their own land.
Sadly, this is not to be. One wonders about the mana-enhancing relationship that the Māori Party has with the Government. Many people in my electorate are asking whose mana has been enhanced by the decision to deny Māori a seat on the new super-city. This decision is very short-sighted. It reflects the lack of long-term vision the Prime Minister has for the building of strong and inclusive cities in New Zealand.
Vote agreed to.
Vote Consumer Affairs agreed to.
Vote Māori Affairs