Wasted time = wasted opportunity

Published in the New Zealand Local Government magazine

The Labour opposition would have done the citizens and ratepayers of Auckland a huge favour if, instead of wasting time and raising Government members' blood pressure filibustering over the passing of the Local Government (Tamaki Makaurau Reorganisation) Act, it had proposed a few sensible amendments.  Over one painful weekend the Local Government (Auckland Reorganisation) Bill became the Local Government (Tamaki Makaurau Reorganisation) Act, but more than just the name changed.  A clause dealing with the transfer of the staff of the existing local authorities to the Auckland Council disappeared from the Act giving the Transition Agency more flexibility as to future staffing arrangements and leaving scope for further legislation to deal with this issue.  In addition Ports of Auckland Limited gained exemption from the requirement for its decisions, other than those likely to significantly prejudice the reorganisation or the future operation of the Auckland Council, to be confirmed by the Transition Agency.  Those changes came from the Government not the Opposition, and do nothing to relieve the constraints the Act places on existing local authorities in the lead up to the establishment of the Auckland Council.   Section 31 of the Act places significant limitations on the operations of existing local authorities, Council controlled organisations, Watercare Services Limited, Auckland Regional Transport Authority and Auckland Regional Holdings during the transition period extending until October 31 2010.  The Transition Agency has authority to review any decision or agenda item made by an existing government organisation.  But this power is hardly necessary except as a backup because the Chief Executives of those organisations are required to submit certain decisions to the Transition Agency for confirmation under section 31.  Decisions of the type in the quite substantial list contained in section 31 must be confirmed in writing by the Transition Agency before implementation, and are void and are of no effect until confirmed.  The decisions that require confirmation range from adopting a policy required by the Local Government Act 2002, to the purchase and disposal of assets otherwise in accordance with the Long-term Council Community Plan ("LTCCP").

Apart from the frustration of having to submit a wide range of decisions to the unelected Transition Agency for confirmation, this constraint gives rise to logistical and practical difficulties.   The most obvious is the need for the confirmation of the decision to adopt or amend an LTCCP or annual plan.  The Local Government Act requires all local authorities to adopt a new LTCCP for the period 2009 - 2019 by June 30 2009, but the logistics of achieving that outcome are daunting.  Not only is it a huge task for the Transition Agency, whose membership was only just announced at the time of writing, but also for the local authorities.  The Transition Agency will need to confirm, presumably after adequate review, all eight LTCCPs.  In order for it to do so the local authorities will need to complete all decision-making, including the decision to adopt the LTCCP, allowing sufficient time for this to occur.  By the time you read this article perhaps we will know how this can be achieved, but from here it looks like a Herculean task.  Or perhaps more importantly a pointless task, because no proper review is possible in the time available. 

One has to wonder what the consequence will be if the decision to adopt an LTCCP is not confirmed by the Transition Agency.  Will the Transition Agency then dictate the changes required before sending the document back to the local authority concerned for amended adoption? Will there be time for this? What about the painstaking democratic process - submissions, hearings etc - that will have preceded the adoption of the LTCCP? Surely it would have been preferable for this process to be completed without interference, and to allow the Auckland Council to make the amendments it requires once it has been established.  The present arrangement is unnecessary to keep the lid on local government spending or activities prior to the reorganisation because all of the draft LTCCPs had been prepared ahead of the Government's decisions on the future of Auckland, and could only be changed by amendments arising out of public submissions.  The requirement for such an overview does little to reassure Aucklanders that their views will be taken into account at the next stage of the reorganisation process.

The decision-making in relation to entering into contracts was also amended during the hubbub surrounding the passing of the Act.  The Bill required confirmation of a decision to enter into a contract with a value over $5,000 that terminated beyond June 30, 2011.  The Act raises the value baseline to $20,000 and amends the requirement so that it now applies to any contract that imposes or will continue to impose any obligation on the local authority after June 30, 2011.  This is either deliberately obstructive, or it is careless drafting.  The requirement for confirmation will now catch a range of short to medium term contracts with relatively common conditions extending beyond the contract period, such as the obligation to pay retentions. 

This is not the only careless drafting in the Act.  Section 27, which deals with the dissolution of the Transition Agency and the transfer of assets and liabilities to the Auckland Council, retains a now meaningless reference to what was formerly clause 36 of the Bill dealing with the transfer of staff.

The Act was passed under urgency and not referred to a Select Committee, giving no opportunity for public submissions.  It is to be hoped interested parties, including the opposition, give more carefully considered input to the next stage Local Government (Auckland Council) Bill, which is open for submissions only until June 22. 

For more information, please contact:

Linda O'Reilly
Partner
t: +64 9 979 2167
e: Linda O'Reilly

Last updated: June 2009

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