Simeon Brown: Local Government Minister addresses changes to Local Government Act

The Local Government Act is being scrubbed of requirements to consider social, economic, environmental, and cultural well-being. 

The Government says its reforms will refocus councils on basics - like fixing pipes, filling potholes, and delivering core services. 

It will also benchmark council performance and modernise rules to drive cost savings. 

Local Government Minister Simeon Brown says this'll stop councils spending lots of money on things they argue fit within the four well-being objectives. 

"They won't be able to use that excuse when they go out to consult on their annual plans or their long-term plans as to why they want to spend money on those activities." 

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Episode Transcript

Speaker 1 (00:00):
The government has declared war again on big rapes, rises
and council pet projects. Councils will be expected to focus
on delivering the basic services without paying attention to the
four well beings that's your social, environmental, economic and cultural
well being. And there will be an annual report done
that will allow people to compare rate increases between councils.

(00:21):
You have to go to the website to check it out.
So me in Browns are local Government minister, good afternoon.

Speaker 2 (00:27):
Good afternoon, Ryan.

Speaker 1 (00:28):
Are they listening to you? Well?

Speaker 2 (00:31):
This is a part of our plan to make sure
that councils do listen to the message that we're giving
it giving them by setting very clear benchmarking and by
changing the law as to what they should be focused on.
And so as ratepayers go to the election next year,
we will have published our first of the annual benchmarking
reports which will help help electors voters be able to

(00:54):
actually more clearly, in transparent apparently understand what their councilors
are spending their money on and whether it's being used effectively.

Speaker 1 (01:02):
You've told them to reign it in before. Famously Luxe
and did it at the Convention Center in Wellington since then,
Wellington's still going ahead with the Golden Mile. In fact,
they put out a report last week's some they're going
to have to increase rates up to fifteen percent and
keep the Golden Mile.

Speaker 2 (01:18):
Well. Look, I think you see different councils across different
parts of the country taking different approaches. I think here
in Wellington I've been very clear. I think for Golden
Mile is a nice to have rather than I must have,
and it's not something which the mayor should be continuing
to pursue. But ultimately not very accountable. Well some aren't,

(01:38):
and they are ultimately accountable to the voters next year
at the election, and in these benchmarking reports would help
help voters with being able to assess the performance of
their council.

Speaker 1 (01:49):
This is a fundamental problem with local government, isn't it
that it's up to the people bug or all vote.
I think Wellington's turnout was forty five percent, which is
actually above average. And you have councils that are fighting
and amongst themselves and don't get stuff done. Is there
anything bigger you can do here? What about compulsory voting
for local government?

Speaker 2 (02:11):
Well, we don't practice compulsory voting in New Zealand, whether
that's central or local government. Should we but what we well, no,
that's not something that we're looking at. But what we
are focused on as saying, you know, councils should be
focused on the basics. We're going to change the law
to remove the full well beings and to put in
place a definition which is very much focused on fixing
the roads and the pipes and those core services that

(02:31):
councils should be doing, and remove the excuses that councilors
use to go and spend money on a whole lot
of other things and then have clear benchmarking in place
so that we can actually measure that and man and
have much more transparent performance around that.

Speaker 1 (02:45):
So if you let once this lauch at these amendments
are made, will Wellington Council be able to do the
Golden Mile?

Speaker 2 (02:53):
Well, that's something that they can fund because they're a
road controlling authority.

Speaker 1 (02:57):
Right ultimately, So is this all us a bluster.

Speaker 2 (03:00):
Then no, not at all. This is I mean there's
a lot of things that councils go and spend money
on which they argue are within the four well beings.
They won't be able to use that excuse when they
go out to consult on their annual plans or their
long term plans as to why they want to spend
money on those activities. And as I said the benchmarking,
the first step is to use the information that's currently available,

(03:22):
put in one place, allow people to be able to
compare that information between councils. We're also going to change
the law to allow the Secretary of Local Government to
have to request further information such as how much is
spending on the contractors and consultants, and further reports will
highlight issues like that so that again local voters are
around the performance of their local council.

Speaker 1 (03:44):
Minister. Two very quick last questions. Did you consider setting
a limit for rate rises?

Speaker 2 (03:51):
That is one of the areas of work that we're
going to make cabinet decisions on in the early new year.
We're investigating around a rates pegging scheme similar to what's
done in New South Wales, so workers underway on that
particular issue.

Speaker 1 (04:02):
Councils will say, well, actually, the problem is we don't
have believers to pull for funding for basics like infrastructure.
You know, they want the government GST issues sorted. There's
a whole bunch of government funding issues they want sorted first.

Speaker 2 (04:17):
Well, the first thing that they needed to focus on
is actually focusing on the basics. That's number one. Secondly,
we have been working very hard this year to look
at how we can support councils around financing long life infrastructure.
There's two key changes that have been made local what
have done well. It actually allows councils to buy up
to five hundred percent against their water revenues, which is

(04:37):
about twice their normal debt level to you have to
invest in long life water infrastructure and spread those costs
over time. Secondly, high growth councils now have an increased
debt cap to three hundred and fifty percent for investing
in other infrastructure such as roads and unlocking housing. So
we've been focused on unlocking those financing tools so that
councils can invest in that long life infrastructure. But the

(04:59):
first messages focus on the basics and do it brilliantly.

Speaker 1 (05:03):
Have you had any reports back from that Crown Observer
and Willington yet?

Speaker 2 (05:07):
I had the first first report back came over the
weekend and ultimately the council's going through its process around
its annual plan. You've already highlighted some of the key
issues there, and that the observer is very much engaged
in all of those conversations.

Speaker 1 (05:22):
What was the what was the report? Was it good, bad, ugly?

Speaker 2 (05:25):
Well, I haven't fully engaged in terms of the detail
yet of what I would say, I've just received it
over the weekend. What it is focus from quickly looking
at it, it's very much focused at the process, making
sure the counselors are getting the information. I'd say the
observers very much engaged in all of those conversations and
looking at the detail. Ultimately, as I said when I
announced the Observer, the counselors are still responsible for those decisions,

(05:48):
and that comes back to this key point therese are
local democracy. Local democracy, it's about local voters making these decisions.
But we're about making sure the transparent information is there
for the public to make up their minds.

Speaker 1 (05:59):
So I mean fom Government Minister, thanks for your time.
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