Doug Fraser: A Model for Southland Local Government Reform

This proposal has been developed in response to the current local government reform discussions in Southland and is intended as a constructive contribution to the Government’s wider reform programme.

The paper recognises that, while there may ultimately be support for a unitary council in Southland, there is currently no consensus on either the preferred governance model or the pathway for achieving it. Rather than delaying meaningful reform until agreement is reached, this proposal outlines a practical transitional model that allows operational reform to begin immediately while preserving local democratic governance.

The model recommends the establishment of Southland Local Government Management Services Ltd, a jointly owned management and service delivery company owned by Environment Southland, Invercargill City Council, Southland District Council and Gore District Council.

The concept draws on the successful PowerNet model, demonstrating how independent organisations can retain governance while sharing professional management, specialist capability and operational systems.

The proposal aligns closely with the Government’s direction for local government by:

• improving efficiency through reduced duplication;

• strengthening management capability through a single regional executive team;

• introducing greater commercial discipline through an independent board with commercial and governance expertise;

• improving infrastructure planning and service delivery;

• helping councils refocus on their core statutory responsibilities; and

• creating the operational foundations for a future unitary council should Southland choose to do so at the 2028 or 2031 local government elections. 

Importantly, the proposal is not an alternative to structural reform. It is a practical pathway for achieving reform in a staged, lower-risk and more politically achievable manner.

While this model has been developed to address the difficulties of reaching a political consensus in Southland, there is no reason why it could not be used in other regions. 

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The Southland Transition Model - A Practical Pathway to Local Government Reform, Improved Service Delivery and a Future Unitary Council

Executive Summary

Southland has an opportunity to become a national model for staged local government reform.

Rather than attempting immediate structural amalgamation, this proposal recommends establishing Southland Local Government Management Services Ltd as a jointly owned regional management and service delivery company for Environment Southland, Invercargill City Council, Southland District Council and Gore District Council.

The model separates governance from management.

Councils continue to represent their communities, set policy, approve long-term plans, determine rates and remain democratically accountable.

The company provides executive leadership, corporate services, technical capability and operational delivery under agreed service level agreements.

Why Change?

Southland currently faces:

• differing views on future governance structures;

• duplicated management and corporate services;

• increasing infrastructure demands;

• workforce capability shortages;

• rising costs and compliance obligations; and

• Government expectations that councils refocus on core services.

Without change, Southland risks spending years debating governance while operational performance remains fragmented.

The Proposed Model

Shareholders

• Environment Southland

• Invercargill City Council

• Southland District Council

• Gore District Council

Governance

An independent Board comprising council-appointed independent directors possessing commercial, governance and infrastructure expertise.

Management

A single Chief Executive leading regional specialist teams responsible for:

• Finance and Procurement

• Human Resources

• Information Technology and Cybersecurity

• Asset Management

• Engineering and Infrastructure

• Project Delivery

• GIS and Data Services

• Regulatory Support

Guiding Principles

1. Governance governs. Management manages.

2. Communities remain represented locally.

3. Professional management delivers services efficiently.

4. Infrastructure investment takes priority.

5. Every activity must demonstrate value for ratepayers.

6. Regional capability replaces unnecessary duplication.

Supporting the Government’s Core Services Agenda

The Government has made it clear that local government should concentrate on its core statutory responsibilities.

The proposed company would undertake a comprehensive review of council activities to identify:

Core Services

• Roads and transport

• Three Waters

• Flood protection and drainage

• Environmental management

• Civil defence

• Regulatory functions

Shared Services

• Finance

• HR

• Procurement

• IT

• Engineering

• Asset management

• Project delivery

• GIS and data

Activities for Review

Programmes that duplicate services, fall outside core responsibilities, or cannot demonstrate value for money should be reconsidered.

Why Independent Directors?

Independent directors with commercial and governance experience would strengthen:

• strategic oversight;

• financial discipline;

• executive accountability;

• organisational performance;

• long-term investment decisions; and

• service delivery outcomes.

Why This Is the Best Transitional Model

The proposal is not an alternative to a future unitary council.

It is the pathway to one.

Between now and the 2028 or 2031 local government elections, Southland could progressively establish:

• one executive leadership team;

• one finance platform;

• one procurement system;

• one IT platform;

• one engineering capability;

• one asset management framework; and

• one regional service delivery culture.

If communities subsequently support a unitary council, much of the difficult operational integration will already have been completed.

Why Southland?

Southland is uniquely placed to demonstrate this approach because:

• it has only four councils;

• it has a proven precedent in PowerNet;

• it has a tradition of regional cooperation; and

• its infrastructure challenges require coordinated regional capability.

Conclusion

The Southland Transition Model offers a practical bridge between today’s fragmented local government structure and tomorrow’s aspirations.

It delivers better services, stronger management, greater efficiency and improved value for ratepayers while preserving local democracy and creating the operational foundations for a future unitary council.

Doug Fraser a retired dairy and sheep farmer with 25 years commercial governance experience.