Think tank says it’s time to put government back in local government


It is time to put the government back into local government and limit central government’s interference in what councils should be doing The New Zealand Initiative believes.

“Around the world, successful communities are marked by systems that let local government make decisions and make them responsible for getting the job done,” says The New Zealand Initiative’s executive director Dr Oliver Hartwich.

“It is significant that the current government’s attempt to further crimp the powers of local government faced a revolt from local government. Enough is enough they are saying.”

The public policy think tank thinks the answer is straightforward. “Change the Local Government Act 2002 to put clear responsibilities and accountabilities on local government and thereby clear limits on central government.”

Hartwich believes central government has spent 160 years interfering in areas that should be the responsibility of local government and as a result neither do their job well. “The current proposals are just another example in a long history of getting it wrong.”

He says the recent election of new mayors in Auckland and Wellington and an established proven mayor in Christchurch mean it is time for change. “New Zealanders’ lack of support for the local government elections is proof enough that communities up and down the length of New Zealand regard local government as largely irrelevant.

“We need innovation and local solutions to local problems and the challenges of economic growth, of housing, of roading and all those other issues that affect people’s lives and that someone in Wellington cannot solve with their so-called ‘national solution or policy’.

“There are issues to be sorted such as revenue sharing by central government, requiring councils to consult citizens and to secure mandates on key issues require the use of local referenda, and where central government does believe in a national policy have a formal means by which local government can apply to opt out.

These are the central recommendations in The Local Manifesto: Restoring Local Government Accountability, which is the third in a series of reports on local government that has included extensive overseas study of other models.

“We have seen devolution of responsibility to local communities at work in the Netherlands, Switzerland, and increasingly the United Kingdom. Far from a recipe for disaster, they have proved to be a formula for success – all three of these nations rank in the top 10 of the Global Competitiveness Index,” said Hartwich.

The report extensively describes how central government’s paternalism towards local government knows no bounds. Recent examples of policy intervention include dog control laws, freedom camping rules and efforts to amalgamate councils into bigger local authorities.

The current situation in New Zealand creates what the report calls an “accountability gap”, where communities are unable to tell which tier of government is responsible for specific services, who is driving costs, or who is setting the quality standards.

To fix this, the report proposes that councils be made fully responsible for all services they currently perform, with limited scope for central government intervention. A necessary check and balance is that councils pay for any costs that their decisions impose on central government.

The final local government report in a series that includes The Local Formula and The Local Benchmark, the document has been welcomed by Local Government New Zealand President Lawrence Yule, who says the paper offers valuable recommendations for improving the performance of both local and central government in New Zealand.

“We are particularly interested in creating greater accountability and transparency around which arm of government is responsible for what,” Yule says.

“The lines of responsibility need to be clearer and the Initiative’s suggestions for achieving this, such as making councils fully responsible for all the services they currently provide, are worth considering. 

“Delegating more power to councils and requiring them to fully consult their communities through mechanisms like referenda could also be useful for engaging communities in the important but often poorly understood issues they face.”

LGNZ chief executive Malcolm Alexander also welcomed the report. “LGNZ’s guiding vision is ‘local democracy powering community and national success’, and proposals that will help create stronger local decision-making are welcomed and worth debating,” Alexander says.

“The recent local elections showed us that we need to do something to get people more actively engaged in their community’s issues.  Achieving better outcomes for our communities will require change from both local and central government, and I look forward to progressing the ideas in this report with the New Zealand Initiative, and local and central government,” Alexander adds.