Twyford Phil: Local Government Act 2002 Amendment Bill — First Reading 
Text is incorporated into the Bound Volume 
Twyford Phil: Local Government Act 2002 Amendment Bill — First Reading 
[Sitting date: 12 June 2012. Volume:680;Page:2841. Text is incorporated into the Bound Volume.] 
PHIL TWYFORD (Labour—Te Atatu) 
: 
 I am standing in for my colleague the Hon Annette King and I rise to express Labour’s opposition to the Local Government Act 2002 Amendment Bill. Labour would support a bill that promotes efficient effective and accountable local government but this bill is not that. This is a politicised attack on local government. It will undermine democratic processes and it takes away the democratic rights of local communities.  
The reforms in this bill are based on a manufactured set of statistics a selective use of data by the Hon Nick Smith in a way that has become that former Minister’s trademark. We saw it earlier in the last parliamentary term with his stewardship of ACC. He whips up a few shonky figures puts them out into the media scaremongers up a good crisis and then pretends to bring a solution. That is exactly what happened here although it is interesting to note that after the data that these reforms were based on were posted on the Department of Internal Affairs website in a Better Local Government document a few days after that document’s release the data was replaced by the department with a comment saying and I quote directly from the website: “there are issues with the data both in terms of accuracy and in terms of the picture that was being given to some councils.” That is not a very promising start to this Government’s local government reform agenda in its second term.  
The main issue that I want to speak to in this contribution is about the change to the rules around the reorganisation and amalgamation of local councils. Currently the law guarantees to all citizens in this country the right to a say in a binding ballot over any proposed reorganisation or amalgamation of their local council. This bill takes away that right. It is the confiscation of the democratic rights of New Zealanders and it opens the door to forced amalgamations in which the citizens of the affected areas will risk having no say at all. Let me repeat—at the moment citizens are guaranteed the right to have a say. They can vote up or down any amalgamation proposal. What did we see from this Government in 2009? It circumvented that right with the forced amalgamation in Auckland. What is the Government doing? It is incorporating that approach into this piece of law.  
If citizens want to have a say then they have 40 working days from the time the organisational change proposal is tabled. They have got 40 working days to get 10 percent of the local voting population to sign a petition seeking the right to have a say in a binding ballot. That is simply not good enough. This is an assault on the democratic rights of communities all around New Zealand. It opens the door to forced amalgamations and that is a broken promise by this Government.  
Last term we heard John Key saying and we heard other National Ministers saying there would be no forced amalgamations. John Key said in March this year and I quote from his post-Cabinet press conference: “We think it’s very difficult for communities to amalgamate again there’ll be some discussions about that with the councils to amalgamate but I wouldn’t look for a forced situation as you saw in Auckland.” Well that is exactly what this bill opens the door to. It takes away the democratic right of New Zealanders to choose the shape and the scale of their local authorities. It takes away their right to a binding ballot. That opens the door to forced amalgamations. It is exactly what John Key promised would not happen.  
That has become this Government’s modus operandi. We saw it in Auckland and we saw it in Christchurch with the sacking of Environment Canterbury the removal of the elected councillors of the Canterbury region. We see that same contempt for democratic values the same contempt for our democratic institutions. It is coming through loud and clear in the Hon Nick Smith’s reform agenda brought to the House today by the Minister of Local Government David Carter.  
There is lots more that is wrong with this bill and I want to focus on a couple of other elements. What we see in this bill is the reincarnation of Rodney Hide’s ludicrous core services agenda. It survives here in a diluted form. What it does is it gets rid of the purpose statement in the current local government legislation which is often referred to as the four well-beings. It replaces that with a narrower focus of providing good quality infrastructure plus local public services and regulatory functions at the least possible cost to households and businesses. Well as many commentators have already pointed out this is a nonsense. The regulatory impact statement says this change is likely to have a symbolic effect and should not affect council business as usual.  
The absurdity of this provision is illustrated by the interview that the Minister gave on  
Q+A 
 a few weeks ago. He was asked what sort of council activity he did not approve of. His example that he gave was the Hamilton V8 Supercars race. Apparently councils running V8 races is bad but the Christchurch flower show— 
Grant Robertson 
: That’s fine. 
PHIL TWYFORD 
: That is really good. This illustrates the absolute intellectual bankruptcy that underpins this bill. V8 races are out; flower shows are in. So this is the kind of intellectual rigour this is the intellectual rigour that we have come to expect from this National Government. If Nick Smith who is often touted as having the biggest brain in the National Cabinet when he was in Cabinet is responsible for this reform agenda and he is the brightest guy in the National Cabinet then this country has got something very serious to worry about.  
The Department of Internal Affairs in the regulatory impact statement takes a much more sober assessment of this issue. It says: “There is no clear quantitative evidence to suggest that the [Local Government Act 2002] has resulted in a proliferation of new activities or that local government is undertaking a wider group of functions.” The regulatory impact statement by the Minister’s own officials contradicts the very premise that this reform agenda is based on. Nick Smith went around the country saying that the sky is going to fall councils are out of control they are spending here and there they are profligate and the four well-beings have led to an explosion of council activity doing all these outrageous things and that is contradicted by the Minister’s own officials and the regulatory impact statement.  
The other main idea that underpins this bill and this reform agenda is the notion that council debt is out of control and that councils are racking up more and more debt and this is a terrible liability. Well we have seen from Local Government New Zealand clear evidence that local authority expenditure as a percentage of GDP is more or less static at around 3 percent and has been for the last 5 years. We see that local authority expenditure as a percentage of total Crown expenditure is more or less static. In fact it has gone down by several points in the last 5 years. The figures show that council expenditure on interest repayments as a percentage of operating income was 4.53 percent in 2010 up from 4.19 percent in 2009. It is a hardly a crisis. The irony is that at a time when councils are being diddled out of a fair share of funding for local roads which for many councils is up to half their operating expenditure this Government is beating them with a stick about overexpenditure when it is cutting back on the funds that councils rely on just to repair and maintain local roads.  
The sinister thing about this Budget is that it is designed to put the fiscal squeeze on local authorities at the very time that this Government is trying to pressure councils in Auckland Christchurch and goodness knows where else to sell assets that their ratepayers have paid for and built up over generations. This Government is trying to do to local government what it is doing to central government and that is to sell off the family silver and sell off lucrative assets that are owned by the people of those communities. This is an illogical poorly thought-through bill. It takes away the democratic rights of communities it undermines local government and Labour will not support it.