Jane Clifton: Leave the big jobs to big government

by Fiona Rae / 24 March, 2012
It is time to reign in the ambit of local councils, but the Government better be ready to recentralise some of their burdens.

In our DIY culture, it’s a well-known syndrome: you do up one bit of the house, and overnight everything else looks shabby or out of proportion, and suddenly there’s exponentially more work to do. The Government’s up-do of Auckland’s local authority structure last term has similarly lumbered it with a much bigger job. Now the whole local body structure seems hopelessly out of whack. At least when it’s a nice old bungalow, you don’t get any push-back when you decide to knock out a wall or two. City Hall will always fight back.

When the Listener broke the news of the Government’s sweeping local government reform plans a month ago, the self-justification from local and regional authorities was swift and strident. There’s little argument that the sector has long been at least as much sinned against as sinning. Governments have devolved responsibility for vital infrastructure to local bodies, and stood back while many of them struggled to cope with what, in some regions, has been a hopelessly disproportionate burden. Councils have not exactly lobbied to have these burdens removed. Funny thing about politicians – they never ask for less power.

But now that Local Government Minister Nick Smith is promising an apocalyptic end to the “cost-plus” era, it’s understandable that many local politicians are asking pointedly who put the “plus” in the cost. The trouble is, this is not really a battle between central and local government. We actually have, counting the one in the Beehive, 79 separate governments in this country. Over time, for reasons of either ideology or convenience, central politicians have caused their local cousins to grow in power to the point where local councils are now mini-governments, with awesome scope, but extremely blunt and limited power to fund that scope.

Perhaps the most well-meaning reform, in 2002, has been the most burdensome: in giving local bodies obligations for people’s social, economic, environmental and cultural well-being, the previous Government gave them virtually boundless agendas – without concomitant funding options. As happened in the 1980s when a series of state monopoly agencies were instructed to behave like private businesses, many of them lost the plot. Instead of focusing primarily on roading, rubbish, sports grounds and the like, councils became carried away with the excitement of also being business development agencies, party-throwers and all manner of things in which they had little expertise. And just like NZ Post, which quickly began complaining, in its new-found freedom, that it didn’t want to deliver letters any more because it was expensive and boring, councils have begun to chafe under the burden of their traditional obligations. Wellington’s, for instance, is threatening to stop collecting rubbish.

It’s hard to overstate the inanity of a post-free postal service, which is why NZ Post is still obliged to do snail mail. A council that doesn’t do rubbish is equally nonsensical – but we are powerless to compel a council to do or not do anything it chooses. Before we become too cynical about all this, it’s only fair to allow that councillors are – despite some ratepayers’ bitter complaint – only human. Who wouldn’t rather preside over, say, a grand plan to make Wellington the movie capital of the world than bang on about the cost of water mains replacement?

Feeding into this was the anxiety of the various regions, particularly provincial cities, to compete for population by providing extra attractions, typically grand sports stadiums. Through the 90s and 00s many of our councils ran expansionary, boosterish regimes, which citizens generally enjoyed. City centres were made much more attractive, and council-sponsored events fostered a new excitement and sense of place, even as people grumbled at rating and fee increases.

Over time, the affordability of the councils’ wider ambit began to seem questionable as, like everyone else in the economy, councils grew more and more comfortable with borrowing. Here, after all, was a fair case for inter-generational debt. But some of the balance-sheet ratios and servicing costs eventually left planet Earth. Councils told themselves that since they owned billions worth of assets, their borrowing was proportionate – dammit, modest! But as the poor old Kaipara Council might attest, it’s no consolation to know that you own gazillions in footpaths, pipes and bollards. It’s not as though you can cash them up. Even the Chinese are not queuing for Overseas Investment Office permission to buy our traffic islands.

Blaming the incompetence and vaingloriousness of councillors and local officials may be therapeutic, and in many cases fully justified, but it’s not terribly helpful. The overarching problem is that for decades we’ve allowed local government to develop almost organically, ignoring some glaring mismatches – chief among them the massive cost of infrastructure. When we left a small territory like Kaipara to fund an irreducibly expensive and absolutely essential thing like a waste-water scheme, what on earth were we expecting to happen?

When we set up regional authorities to arbitrate big-project decisions, we thought we were forcing neighbouring local bodies to co-operate. But just as often, all we achieved was squabbling, delay and extra costs. A simple decision, like whether to put a road through Transmission Gully, typically proved as elusive as Lord Lucan.

Even Labour’s well-motivated attempt to frogmarch councils toward the laudable democratic ideal of asking for opinions before doing things to people has backfired. Councils do indeed go through elaborate consultation and reporting, yielding torrents of expensive, unread doorstop reports that license them to do whatever is stipulated in print. “It’s in the district plan! We had a public consultation meeting!” have become new tenets of holy writ.

Hands up those who feel more consulted? Realistically, most of us will never go to a council’s public meeting or crack open a district plan. The crowning evidence of failure: participation in local body elections has fallen even further. It’s now well below 50% of eligible voters. We’ve actually turned ourselves off local politics by making it more unwieldy and opaque than ever.

Smith vows to limit rating and borrowing and reduce the scope of council activities. But if he is to withstand the howls of outrage resulting from what will be a massive loss of power for the sector, he’d better be prepared to recentralise a big chunk of the councils’ infrastructural burdens. Is it rational any more to have all our roading, water, environmental and sewerage ­decisions made at a parochial level? With the new super-ministry harnessing economic development, science, trade and enterprise, it might also be time to super-ise our transport and infrastructural planning, execution and funding.

The psychological circuit-breaker here is Auckland. Suddenly we’re being forced to realise that parish-pump concerns are really everyone’s concerns, and are often best addressed centrally. If Auckland is struggling, we all struggle. We’re all entitled to an opinion about how Auckland is run, right down to the rates rises. Even little Kaipara’s insolvency will come to affect everyone. That’s why Smith’s biggest ally for his reform agenda is the public. Local government can reassure itself it provides good value for money, and does a sterling job. But it long ago lost the confidence of the public, who have only to look out their windows to see wasteful spending. Headline-grabbing niggles like rapacious parking charges, spy cars and exorbitant salaries may not add up to much fiscally, but they show a shocking lack of leadership in tough economic times, and a bewildering lack of comprehension of basic PR.

But after denial comes acceptance, and it’s a shrewd turkey who can figure out how to survive Christmas. The apocalypse is coming, but such power as will be left can be always be optimised. Watch for more canny operators, like Wellington’s Fran Wilde, leading the charge for more territorial amalgamations into super-cities.
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