One big council - one big bureaucracy

Governance in Auckland has been seen as a problem by many, mostly councils and central government, for some time. Mainly by those who think councils should be doing certain things, rather than considering whether such things should be done at all, and if so, by whom. I've not seen a major problem. Transport is often cited as an issue, but in the last few years umpteen major motorway improvements have progressed in Auckland (I can think of eight) and the major hold up has been the ridiculously expensive boondoggle called rail. Just because neither users nor ratepayers are willing to pay for this, doesn't mean there is a problem in governance - it is a problem with the idea.

So the report in the NZ Herald today of what the Royal Commission on Auckland Governance will recommend should send shivers up the spines of Auckland ratepayers - and by that I mean ratepayers of any one of the seven Auckland territorial local authorities. One big council, without restricting what it should do, will be a behemoth of a bureaucracy looking for a job. On top of that a Mayor, with powers to dictate, should also scare Aucklanders - as such Mayors will look for totem poles to build, at the expense of everyone else.

A libertarian view of local government would be that it is hardly needed at all. After all, as long as private property rights are well defined (which at present they are not), then planning becomes simply the delineation between those rights (which could include airspace, sight lines and factors for air and noise). Most of what else local government does is to meddle in utilities or supply facilities that could be provided privately, assuming that local government didn't pilfer money from everyone to pay for them.

So what is really needed in Auckland is not the creation of a mega council, but a serious debate about what the role of local government should be.

Labour, with the Alliance (before it divorced Jim Anderton) and the Greens changed this radically with the Local Government Act 2002, by repealing rather unwieldy legislation that defined what local government was allowed to do, and granting a "power of general competence" (yes the joke from that phrase is too obvious). This effectively gave councils the power to build, buy, sell or engage in any activity that a natural person could do. Councils could set up schools, restaurants, trucking firms, radio stations, dry cleaners, banks or service stations, as long as they went through due processes of consultation. This was a view that local government could effectively be a mini-version of central government, although Labour resisted granting local authorities new taxation or regulatory powers.

National and ACT voted against this legislation, quite rightly so. It is time to take a different approach.

Look at what councils do that could simply be privatised, whether by sale or by transferring to trusts run by interested people. All commercial activities could clearly be sold, or shares transferred to ratepayers. Non commercial activities, like recreational centres, pools, libraries and parks could be transferred to interested parties to run, accept sponsorship, donations or charge for usage. The regulatory activities of councils could then be reviewed on a case by case basis, to consider how private property rights could be used to address the relevant issues.

In short, there is a grand opportunity to rethink local government, so that it shrinks considerably in the next three years. The more difficult examples, like local streets and footpaths may be last on the list, but in the meantime rates should be capped - permanently at current nominal levels, to force councils to trim, and if need be, merge. In other words, the scope for local government to be perpetual busybodies would decline over time, freeing up ratepayers funds, land and the public to decide whether what is done "for the public good" is actually what they are prepared to pay for. Commercial property owners in areas for "regeneration" may foot the bill for upgrading the street scape, instead of expecting all ratepayers to chip in.

The grand council idea is a recipe for local government to do more, much much more. I believe Owen McShane once wrote that the ideal size of a council was one that served between 10,000 and 40,000 people - not so small that it couldn't have enough capacity to carry out its functions, but not so big that it could charge ratepayers enough surplus to dabble in new areas of activity.

The appropriate response of the new government to this forthcoming report is thanks, but no thanks - there needs to be a more fundamental review of the role of local government. Local government has resisted year in year out the drive for lower taxes, and rode on the back of property price increases to increase rates beyond inflation. It is time to say no to a big Auckland council, and consider instead something else as a first step. Why does Auckland need two layers of local government?

Oh and if you think I'm wrong, note this part of the report "the commission will almost certainly recommend the mayor and new council become more involved in the social needs of the region, such as affordable housing".

Get it? You vote out a leftwing central government and you can watch one get elected locally - and you know who will be forced to pay for it.

I can only hope the Minister for Local Government can see this for what it is - a report commissioned by the last government which should be destined as a door stop.