It’s been a long time coming. But the message has finally been delivered. And from the high office of the Prime Minister no less
I refer to the fact that Christopher Luxon has finally delivered a message to our local body mayors, councillors and their respective hangers-on that they need to get back into their box.
It’s about time.
I’ve said for years the fundamental problem with our local government leaders is that they don’t seem to worry about revenue. They just spend what they want and send us all a rates bill to pay for it all. As we all know, it’s easy to spend other people’s money.
Prime Minister Luxon used the platform of his speech at the Local Government New Zealand conference in Wellington last week to deliver his hard-nosed, and since widely lauded, message.
He said “ratepayers expect local government to do the basics and to do the basics brilliantly”. He referred to the need to collect rubbish, fix the pipes and repair the potholes. And quite rightly, he went on to say ratepayers expect to pay for such services.
However, he also said those same ratepayers don’t expect to pay for a “laundry list of distractions and experiments that are plaguing council balance sheets across the country”.
And he challenged those in the audience to “rein in the fantasies and get back to delivering the basics”.
Brilliant.
His timing was pretty good too. On the morning of his speech, as if to illustrate the accuracy and appropriateness of his comments, the water pipes just down the road, in the streets of Wellington, were bursting again.
I’ve never understood why we need the coalition of councils that call themselves Local Government New Zealand anyway. Our system of government provides for local authorities and central government. Why do we need an organisation between the two?
In the past few years our two largest cities have worked that out. Both Auckland and Christchurch have pulled out of LGNZ. Both Kaipara in the north and Timaru in the south are similarly withdrawn. Auckland’s departure was preceded by a contentious council vote at which Mayor Wayne Brown had to use his casting vote to split the councillors’ deadlock. Brown then cited the $640,000 membership fees as being part of the reason for his view. Six hundred and forty thousand dollars per annum. For what? Membership of another lobby group?
Local Government NZ has its own organisation and management team, complete with a CEO and a board. Its website states it has been around since 1988 and makes statements about its vision that include “leading best practice in the local government sector” and “helping communities participate in local democracy”
Given the state of our water assets, local roading and the quality of most of our public transport services, one would suggest they are failing on the objective of best practice.
And I don’t think the decline in voter turnout over the past couple of decades of local body elections would suggest communities are participating in local democracy as much as they might like to think.
Apparently, LGNZ also “generate a national conversation about key local government challenges by commissioning research and developing thought leadership”. Just what our little country needs. More thought leadership. How about we stop thinking and start doing?
The truth is we don’t need an underperforming middle man sitting between our councils and our government. It’s another lobby group, another pedestal for a small number of attention seekers to stand on, and another waste of ratepayer and taxpayer money.
The Prime Minister is absolutely correct. As he says, we need our local councils to be brilliant at the basics. That means core services like water supply and wastewater. We need the stormwater system to catch the rain before it comes into our houses and to trap the rubbish before it enters the harbour. It means public transport, emergency management and environmental direction. It means town planning, dog registration and building permits.
Our cities need stadiums to host events, and parks and swimming pools where we can exercise. We need footpaths that are safe to walk on. And we should be happy to pay whatever responsible cost structure is required to fund that stuff.
But we don’t need big events agencies or tourism businesses. And we don’t need hundreds of kilometres of unused cycleways, or pot plants on the road where the parking places used to be. We don’t need raised pedestrian crossings every 200m and we don’t need big blue dots on the intersections. And we certainly don’t need public toilets that are so over-engineered that they are winning design awards.
And, as the PM so eloquently stated, we don’t need brand-new $180m conference centres that lose money, when we can’t organise the water supply.
Part of the problem is that most of these flash extra projects and services don’t pay their way in a small country. Why do we pay $15,000 for a water meter? Why is it so complex and expensive to get a set of building plans and consents signed off? Why is the cost of parking in the big cities going off the affordability index? Because council management has become excessively focused on generating revenue to feed their machines of excess, rather than providing a simplified machine to meet the needs of the city.
Of course the Prime Minister’s speech brought out those who prefer to criticise and they came out firing. Many of the mayors weren’t impressed at the way they were spoken to. No surprises there. Wellington Mayor Tory Whanau described his speech as “quite shocking” and described him as incredibly rude. But then, she would, wouldn’t she. Her council, mired in mismanagement, is promoting a 16.9% rates increase for the 2024-25 year.
Then there was that other representative of big spending, Labour leader Chris Hipkins, who had his own turn at the same conference. His comments, equally predictable, were that Luxon’s speech was “cheap and petty politics”. He went on to say the coalition Government was more focused on “apportioning blame” than addressing the funding and infrastructure challenges councils face. This from one of two leaders of what is regarded by many as our worst government ever. One that borrowed excessively and spent money recklessly, with little if anything to show for it. You sometimes wonder how these people can look themselves in the eye.
But let’s put these matters into perspective. Tauranga City Council, an organisation whose governance was so bad it had a government-appointed commissioner running the show until recently, has proposed rates increases of 13.1%. Over the hill in Hamilton, the number is 16.5%. Down the line in Hastings and Napier they’re talking about 19%. The South Island is no better. Canterbury Regional Council at 17.9% and Otago Regional Council at 16.3%. These are huge increases.
As for us ratepayers, what choice do we have but to pay, where a failure to do so will incur a massive and disproportionate penalty.
And so, the Prime Minister makes a strong and well-overdue point. These people are out of control. Most of the people I’ve spoken to were delighted to hear him having a go. The Auckland mayor, too, must have liked it, seemingly doubling down on the criticism of others’ spending, with a video presentation featuring himself boasting about the money he’s saved ratepayers and, having come in at 6.8%, the differences between Auckland rates increases and those of other councils.
But for me, the main outcome of Luxon’s speech was this. We are starting to get the sense that after eight months of working through the mess it inherited, the Government is starting to find its stride. Their coalition appears, from the outside at least, to be working well. They’re moving fast and getting a few small wins here and there, having pushed through their tax cuts, education reforms and taking back control of the health system. The cops are finally disrupting the gangs and confiscating their assets in the process. With a few wins comes confidence. That includes the confidence to take on those who perpetually have their hands out. And there are plenty of people in that particular category in this country.
It shouldn’t be a surprise that we are hearing a Prime Minister speak like this. After all, being responsible with the country’s coffers is part of his brief, and his comments shouldn’t strike us as revolutionary. Rather, those comments should strike us as good old-fashioned common sense. But we’re talking about it because it hasn’t happened for a while.
I like the fact that we are finally recognising, to use the Prime Minister’s own words, that “there is no magic money tree sitting in Wellington”. It’s nice to see a government making the tough calls on spending rather than one presiding over a lolly scramble of taxpayer cash.
My only hope is that the PM and his team don’t stop at councils, and that they deliver the same message to the many others who continue to stand in line waiting for their share of the handouts.
Bruce Cotterill, a five time CEO and current Company Chairman and Director with extensive experience across a range of industries including real estate, media, financial services, technology and retail. Bruce regularly blogs on brucecotterill.com - where this article was sourced
I’ve said for years the fundamental problem with our local government leaders is that they don’t seem to worry about revenue. They just spend what they want and send us all a rates bill to pay for it all. As we all know, it’s easy to spend other people’s money.
Prime Minister Luxon used the platform of his speech at the Local Government New Zealand conference in Wellington last week to deliver his hard-nosed, and since widely lauded, message.
He said “ratepayers expect local government to do the basics and to do the basics brilliantly”. He referred to the need to collect rubbish, fix the pipes and repair the potholes. And quite rightly, he went on to say ratepayers expect to pay for such services.
However, he also said those same ratepayers don’t expect to pay for a “laundry list of distractions and experiments that are plaguing council balance sheets across the country”.
And he challenged those in the audience to “rein in the fantasies and get back to delivering the basics”.
Brilliant.
His timing was pretty good too. On the morning of his speech, as if to illustrate the accuracy and appropriateness of his comments, the water pipes just down the road, in the streets of Wellington, were bursting again.
I’ve never understood why we need the coalition of councils that call themselves Local Government New Zealand anyway. Our system of government provides for local authorities and central government. Why do we need an organisation between the two?
In the past few years our two largest cities have worked that out. Both Auckland and Christchurch have pulled out of LGNZ. Both Kaipara in the north and Timaru in the south are similarly withdrawn. Auckland’s departure was preceded by a contentious council vote at which Mayor Wayne Brown had to use his casting vote to split the councillors’ deadlock. Brown then cited the $640,000 membership fees as being part of the reason for his view. Six hundred and forty thousand dollars per annum. For what? Membership of another lobby group?
Local Government NZ has its own organisation and management team, complete with a CEO and a board. Its website states it has been around since 1988 and makes statements about its vision that include “leading best practice in the local government sector” and “helping communities participate in local democracy”
Given the state of our water assets, local roading and the quality of most of our public transport services, one would suggest they are failing on the objective of best practice.
And I don’t think the decline in voter turnout over the past couple of decades of local body elections would suggest communities are participating in local democracy as much as they might like to think.
Apparently, LGNZ also “generate a national conversation about key local government challenges by commissioning research and developing thought leadership”. Just what our little country needs. More thought leadership. How about we stop thinking and start doing?
The truth is we don’t need an underperforming middle man sitting between our councils and our government. It’s another lobby group, another pedestal for a small number of attention seekers to stand on, and another waste of ratepayer and taxpayer money.
The Prime Minister is absolutely correct. As he says, we need our local councils to be brilliant at the basics. That means core services like water supply and wastewater. We need the stormwater system to catch the rain before it comes into our houses and to trap the rubbish before it enters the harbour. It means public transport, emergency management and environmental direction. It means town planning, dog registration and building permits.
Our cities need stadiums to host events, and parks and swimming pools where we can exercise. We need footpaths that are safe to walk on. And we should be happy to pay whatever responsible cost structure is required to fund that stuff.
But we don’t need big events agencies or tourism businesses. And we don’t need hundreds of kilometres of unused cycleways, or pot plants on the road where the parking places used to be. We don’t need raised pedestrian crossings every 200m and we don’t need big blue dots on the intersections. And we certainly don’t need public toilets that are so over-engineered that they are winning design awards.
And, as the PM so eloquently stated, we don’t need brand-new $180m conference centres that lose money, when we can’t organise the water supply.
Part of the problem is that most of these flash extra projects and services don’t pay their way in a small country. Why do we pay $15,000 for a water meter? Why is it so complex and expensive to get a set of building plans and consents signed off? Why is the cost of parking in the big cities going off the affordability index? Because council management has become excessively focused on generating revenue to feed their machines of excess, rather than providing a simplified machine to meet the needs of the city.
Of course the Prime Minister’s speech brought out those who prefer to criticise and they came out firing. Many of the mayors weren’t impressed at the way they were spoken to. No surprises there. Wellington Mayor Tory Whanau described his speech as “quite shocking” and described him as incredibly rude. But then, she would, wouldn’t she. Her council, mired in mismanagement, is promoting a 16.9% rates increase for the 2024-25 year.
Then there was that other representative of big spending, Labour leader Chris Hipkins, who had his own turn at the same conference. His comments, equally predictable, were that Luxon’s speech was “cheap and petty politics”. He went on to say the coalition Government was more focused on “apportioning blame” than addressing the funding and infrastructure challenges councils face. This from one of two leaders of what is regarded by many as our worst government ever. One that borrowed excessively and spent money recklessly, with little if anything to show for it. You sometimes wonder how these people can look themselves in the eye.
But let’s put these matters into perspective. Tauranga City Council, an organisation whose governance was so bad it had a government-appointed commissioner running the show until recently, has proposed rates increases of 13.1%. Over the hill in Hamilton, the number is 16.5%. Down the line in Hastings and Napier they’re talking about 19%. The South Island is no better. Canterbury Regional Council at 17.9% and Otago Regional Council at 16.3%. These are huge increases.
As for us ratepayers, what choice do we have but to pay, where a failure to do so will incur a massive and disproportionate penalty.
And so, the Prime Minister makes a strong and well-overdue point. These people are out of control. Most of the people I’ve spoken to were delighted to hear him having a go. The Auckland mayor, too, must have liked it, seemingly doubling down on the criticism of others’ spending, with a video presentation featuring himself boasting about the money he’s saved ratepayers and, having come in at 6.8%, the differences between Auckland rates increases and those of other councils.
But for me, the main outcome of Luxon’s speech was this. We are starting to get the sense that after eight months of working through the mess it inherited, the Government is starting to find its stride. Their coalition appears, from the outside at least, to be working well. They’re moving fast and getting a few small wins here and there, having pushed through their tax cuts, education reforms and taking back control of the health system. The cops are finally disrupting the gangs and confiscating their assets in the process. With a few wins comes confidence. That includes the confidence to take on those who perpetually have their hands out. And there are plenty of people in that particular category in this country.
It shouldn’t be a surprise that we are hearing a Prime Minister speak like this. After all, being responsible with the country’s coffers is part of his brief, and his comments shouldn’t strike us as revolutionary. Rather, those comments should strike us as good old-fashioned common sense. But we’re talking about it because it hasn’t happened for a while.
I like the fact that we are finally recognising, to use the Prime Minister’s own words, that “there is no magic money tree sitting in Wellington”. It’s nice to see a government making the tough calls on spending rather than one presiding over a lolly scramble of taxpayer cash.
My only hope is that the PM and his team don’t stop at councils, and that they deliver the same message to the many others who continue to stand in line waiting for their share of the handouts.
Bruce Cotterill, a five time CEO and current Company Chairman and Director with extensive experience across a range of industries including real estate, media, financial services, technology and retail. Bruce regularly blogs on brucecotterill.com - where this article was sourced
4 comments:
In the aftermath of Gabrielle the Hawkes Bay Regional Council changed to land based rating.
A huge kick in the you know what for reeling ratepayers with increases around 100% .Rural people now paying for public transport they do not utilise.
Yet Luxon, like those before him, are more than happy force councils to take on work mandated by government without any recompense.
Seems there are problems with both parties, not just one.
As far as I'm aware, Mr Luxon failed to mention what far too many regional and local Councils are suffering - the tail wagging the dog!
Elected Councillors face accusations as their reelection (as applicable) draws nearer, that they are mere rubber stamps and figureheads for the massive bureaucracy (hiding) behind them.
If so, then let's hear from them how much they have achieved directly to the benefit of ratepayers. There are too many Vanity Projects, too many trendy, woke ventures.
Maybe if all councils pulled out of LGNZ, that organisation would cease to exist. I wish Palmerston North City Council and Horizons would also decline to waste our money on these membership fees
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