Twyford Phil: Kaipara District Council (Validation of Rates and Other Matters) Bill — Second ReadingText is subject to correctionTwyford Phil: Kaipara District Council (Validation of Rates and Other Matters) Bill — Second Reading[Sitting date: 13 November 2013. Volume:694;Page:33. Text is subject to correction.]PHIL TWYFORD (Labour—Te Atatū): Labour is supporting the Kaipara District Council (Validation of Rates and Other Matters) Bill. As the previous speaker Mike Sabin commented this has been a difficult and challenging situation I think for all concerned. No one likes validating legislation for good reason.In this case wrongs have certainly been done. In the years since 2006 the Kaipara District Council has repeatedly breached the Local Government Act and the Local Government (Rating) Act in a long list of instances that revolve round the setting of rates and in a series of failures in relation to adopting annual reports long-term plans and carrying out special consultative procedures under the Local Government Act. The borrowing for the ill-fated Mangawhai EcoCare Wastewater Treatment Scheme blew out as the previous member stated from $11 million to $62 million. The effect of that scheme and its financing has placed a massive financial burden on a small number of ratepayers particularly those ratepayers in Mangawhai.So what is the situation we have got? We have got years of sub-par governance in the Kaipara District a massive debt blowout allegations of impropriety a rates strike by the Mangawhai Residents and Ratepayers Association and as a result of that the council’s finances grinding to a halt. So what should happen from the point of view of the Government? Well Mike Sabin brought a bill to this House on behalf of the Kaipara District Council and the Government-installed commissioners that seeks to validate a series of unlawful acts by that council in the setting of rates.The commissioners want those unlawful acts validated retrospectively so that the rates demands of the last few years are legalised and so that the rates strike being held by the ratepayers of Mangawhai is brought to an end so that the commissioners can sort out the finances. That is what they want. The aggrieved ratepayers of Mangawhai have bitterly opposed this bill and their argument—which has some merit in my view—isthat once the unlawful actions have been validated the rates legalised and the rates strike brought to an end their leverage to try to achieve a broad legitimate and fair solution will be greatly reduced. I have a great deal of sympathy with that argument. The wider issues here which are outside the scope of this bill do need to be addressed—the basis on which the waste-water scheme was commissioned and financed and the decision to expand the scheme and increase the borrowings and the levels of debt incurred.On the other hand the Kaipara District does need to move forward. I have concluded on the basis of the submissions and the discussions that we had at the Local Government and Environment Committee that there are three key elements that have to be part of a settlement of this issue. The first is that if negligence or corruption is found to have been involved in the governance of Kaipara District Council and if the report of the Auditor-General does uncover culpability of that nature then the wrongdoers must be held accountable. I take some assurance from the unanimous cross-party agreement at the select committee which is included in the commentary on this bill that we expect the Government to hold those people accountable if the Auditor-General’s reports finds wrongdoing of that nature.The second is that the Mangawhai ratepayers group must not be punished for blowing the whistle. There were wrongdoings committed here. The financial cost to the residents is significant and they must not be punished for blowing the whistle. That is why I am pleased to see a commitment being made by the commissioners to the select committee that there would be an amnesty for the rates penalties incurred by those people withholding their rates in protest at this situation. On the basis of those two elements I believe then that there is a basis for passing this bill so that all of the ratepayers and the people of Kaipara District can move forward.I want to read into the record the critical paragraphs that are included in the commentary that accompanies this bill which was agreed and negotiated at the select committee. It states: “We recognise that elements of the governance of the Kaipara District Council were unsatisfactory over a period of time and led to the problems that this bill addresses. We hope this bill while limited in scope will contribute to a resolution of the issues so the council and its ratepayers can move forward.”It states: “We have given considerable thought to the question of penalties being waived that relate to rates withheld as parts of the ‘rates strike’. Notwithstanding the legal requirement for ratepayers to pay their rates we acknowledge that the strike came about after many people from across the district had raised concerns about the activities of the council which do not seem to have been actioned. Section 85 of the Local Government (Rating) Act 2002 stipulates that a local authority may remit rates in accordance with its rates remission policy. This approach was followed by the Kaipara District Council Commissioners for the 2011/12 rates. We are pleased that the commissioners have undertaken to extend this to include the 1 January 2013 and 1 July 2013 rates. We support this course of action and feel that it in conjunction with the withheld rates being paid would go some considerable way to resolving the situation so that the people of the Kaipara District as a whole may move on.”It continues: “We note that the Controller and Auditor-General is soon to release a report on these issues. The report was not available [to the select committee] at the time of deliberation but we were assured [by the Auditor-General’s office] that the bill contains nothing that interferes with or compromises the pending Controller and Auditor-General’s report or actions that might eventuate from it. In the interests of securing a fair and legitimate settlement of the matter of the Mangawhai Community Wastewater Scheme we trust that if the Controller and Auditor-General finds parties culpable then the Government and the council will ensure that those parties are heldaccountable. For the same reason we welcome the agreement by the Kaipara District Council to implement an amnesty by way of relief of rates penalties levied on ratepayers in relation to the Mangawhai Community Wastewater Scheme from July 2012 to 1 January 2014.”And that is the basis I think of the consensus hammered out by the select committee in good faith in a genuine effort to try to find a resolution albeit imperfect to what has been a very difficult and challenging situation in the Kaipara District. I am sure that the passage of this bill and the agreement that I have just read out will not satisfy many people particularly the Mangawhai Residents and Ratepayers Association but it is the job of this Parliament to make a judgment about what is in the best interests of the rule of law of all of the people in the Kaipara District including those Mangawhai ratepayers who are so aggrieved.I believe that if the Government meets its part of the bargain that if the commissioners at the Kaipara District Council stand by their commitment to hold accountable anybody whom the Auditor-General finds to be culpable through negligence or corruption or other forms of wrongdoing that led to the decisions that were made around the waste-water scheme then justice will be done in this case. In the meantime the people of the Kaipara District have to move forward. There is still going to be a significant financial burden as a legacy of the waste-water scheme a burden that will lie on the shoulders of the residents both of Mangawhai and the broader district. I know that many of those ratepayers will feel aggrieved about that.I believe that the committee has worked hard to try to make sense of this issue and to try to strike a balanced solution that does its best to meet the interests of all the parties involved. I want to recognise the work of Mike Sabin the local member who I think brought the bill to the House with the best intentions of trying to find a solution. I want to acknowledge the chairpersonship of Nicky Wagner and the work of all of the members of the committee in getting us to this point.