Christchurch City Council (Rates Validation) Bill — Third ReadingText is incorporated into the Bound VolumeChristchurch City Council (Rates Validation) Bill — Third Reading[Sitting date: 03 June 2015. Volume:706;Page:4295. Text is incorporated into the Bound Volume.]Christchurch City Council (Rates Validation) BillThird ReadingHon NICKY WAGNER (National—Christchurch Central): I move That the Christchurch City Council (Rates Validation) Bill be now read a third time. I am delighted to be here today to present this Christchurch City Council (Rates Validation) Bill at its third reading. There has been quite a lot of controversy around this bill but basically it is very simple it is very straightforward it is very short and it is very focused. What this bill does is set out to validate rates irregularities that came to light to the Christchurch City Council just last year.Let us give you a little bit of context. Each June the Christchurch City Council—and in actual fact councils across the country—resolve to set their rates for the next financial year and since 2004 the wording for that rates resolution has been the same or similar. But in 2013 the Department of Internal Affairs informed the Christchurch City Council that the resolution did not meet the requirements of the Local Government (Rating Act) of 2002. So let me get that straight—for 9 years it had been using the same resolution and for 9 years unbeknown to everybody that rates resolution had been faulty.The problem all began back in 2004 when the council deliberately set out to simplify and to use everyday language in setting its rates resolution. But inadvertently it left out important bits of information—important requirements—which meant that that resolution was invalid. Under section 24 of the Local Government (Rating) Act it requires that a rating resolution must include the date on which the rate must be paid and if that rate is to be paid in instalments it must include the amount and the date of each instalment. Section 57 which authorises additional penalties requires that the resolution also states when the rates must be paid and the due date and the resolution must also state how the penalties are calculated and the date on which those penalties must be paid. In this case the Christchurch City Council’s resolution did none of that but let me make it clear: all the required information was available. It was all available in the council’s rating policy and in the funding impact statement. It was discussed at the council table. It was aired in the local newspaper. It just was not in the resolution. So the attempt to simplify had basically backfired and although nobody had noticed and it had gone on for 9 years finally in 2013 it had to be repaired.I must give credit to the temporary chief executive officer of the Christchurch City Councilat that time Jane Parfitt because immediately the council was able to correct the 2013-14 rates resolution and then it went back to review all its other past resolutions. They managed to identify a number of other technical irregularities. They found errors in the setting of seven targeted rates and also in the setting of the uniform annual general charge. It was the same problem. Although the background information was readily available it was not in that resolution so all those resolutions were irregular. As I have said they were able to fix those resolutions going forward but there was no ability for them to fix the resolutions going back hence this bill.I would like to thank the Local Government and Environment Committee members again who thoroughly canvassed the background to this bill and worked their way through their process. I would particularly like to thank the leadership of Scott Simpson as the chair. The debate has gone on because nobody in Parliament ever likes to pass retrospective legislation. We have done it several times in the last few years and it is unfortunate that this bill has had to come to the House. Fortunately this bill is very much about technical errors. Nobody has lost anything. There has been no fraud and no suspicious behaviour—just the problem with the simplification of the language where the council thought it was doing a good thing which has backfired. I commend this bill to the House.Dr MEGAN WOODS (Labour—Wigram): I am pleased to take a short call on the final reading of this local bill. I would like to acknowledge the work of the member who has just taken her seat the Hon Nicky Wagner in bringing this local bill to the House. As she said in the remarks that she made on this bill this is retrospective legislation—a way for us to fix a problem with the way rates have been struck over a period of time in Christchurch City. I share the sentiment that no one likes doing this that this really is not what Parliament envisions for itself in terms of what it wants to have as its function in our great democracy—fix up what has been an error in the way that rates were struck—but it is something that needs to be done and I would like to acknowledge that.We have had at previous readings of this bill a fair amount of criticism that has come on the councillors and on the council in terms of making this error. In fact we have had Government members being incredibly critical of the institution throughout the readings of this bill. I would just like to make the point that several times we in the Opposition have felt a certain amount of frustration about coming back into this House to play patch-up on legislation where we have pointed out those very errors at the select committee or indeed in this debating chamber. So I think that we can see that errors referred to across the House occur in this place too.What is fundamentally important about this piece of legislation what is important for us on this side of the House as Labour is valuing that relationship between central and local government. It is critical that we have strong and productive relationships between Parliament our territorial local authorities and our district councils—that local government is just that. It is where we reach our communities and where a lot of very good work is done. So I would not like to see any comments made in this House that denigrate that relationship. Labour will be supporting this bill and I am happy to commend it to the House.SCOTT SIMPSON (National—Coromandel): As the chairman of the Local Government and Environment Committee I am going to support the Christchurch City Council (Rates Validation) Bill. I do so reluctantly. The previous speaker Dr Megan Woods made mention of the criticism that had been levelled at Christchurch City Council in previous debates as this bill has progressed through this House. I want to just acknowledge that the criticism that was levelled at council members was in terms of their lack of ability as highly paid professionals to get it right. The road to hell is paved with good intentions and on this occasion the intention was actually to make the passing of rates motions by the council easy more simple and to use so-called simple English. The net result of the change however was that the motions that were passed for 9 consecutive years at the council were in fact invalid not correct and wrong. The problem with that the net impact is that although in this particular instance no malfeasance no fraud no wrongdoing no maliciousness and no actual—more by good luck than good management—financial liability to council or ratepayers occurred had a ratepayer decided to challenge the validity of the rates for any one of those 9 years then the council would have had not a single leg to stand on in terms of enforcing those rates payments.That is not a situation that is professionally acceptable in one of the nation’s largest councils so I do not resile at all from my criticism particularly in my second reading speech on this bill of the lack of professionalism by the council. When we visited Christchurch as a select committee we were stuck by the manner and tone of the single submission that we received on this bill from the Christchurch City Council itself. I guess that some members of the committee found that it was the tone and the manner of the submission that was of most concern. It was not the error in itself but it was that there seemed to be no sense of proportion no sense of contrition no sense of culpability and no sense of understanding that in fact what had occurred was something that should not have occurred—simply that Parliament would put it right by merely passing a piece of validating legislation. As the previous speaker indicated this Parliament does not like passing retrospective validating legislation. When it does have to from time to time usually it is introduced by some local member—and in this case it was my colleague the member for Christchurch Central the very good and hard-working Nicky Wagner who has had to bring this bill to the House as sponsor a bill promoted by the council. She has had to convince her colleagues in caucus and then manage and steer it through the House in a way that I do not think a local member would ever really want to do.So what of this bill itself? Well this bill seeks to validate specified rates between the financial years 2004-05 through to 2012-13. The legislation itself has no impact at all on ratepayers. There is no change to the amount of rates or penalties due from any ratepayer as a result of the wrong and error-filled wording of the council-passed motions in each of those 9 years. The errors were entirely restricted to the Christchurch City Council’s rates resolutions on each one of those years and the rates assessment notices and invoices contained the right information. This is the sort of slightly odd thing about this. The information that went to ratepayers and the actual amounts of rates that were levied were correct but it was just the legal niceties—it was the fine print the dotting of the i’s and the crossing of the t’s that did not occur. The errors were spotted by the audit process and then giving full credit to the council it did seek to remedy the situation as promptly and as quickly as it could. However it did not change the fact that retrospective legislation was still required to validate and legalise the motions that had been passed for each of those 9 years. So what Christchurch City Council did was it corrected the situation by issuing a revised resolution and resetting its rates as soon as it was aware of it but the historic errors for earlier years from 2003-04 to 2012-13 could be corrected only via a validating piece of legislation and that is this bill.What this bill does is it validates those payments for historic rates back over those 9 years. It validates the penalties that were added to unpaid rates for those years which of themselves were not legal in terms of the motions that were passed by the council. What it also does is it validates the basis for certain targeted rates during those various years and the penalties that were subsequently added to those rates as a result of non or slow payment. What this bill also does is it confirms that all rates money collected by Christchurch City Council during those 9 years is in fact lawful. What I guess we need to consider as a Parliament is what lessons have been learnt through this process and not only how we might ensure that a situation like this at Christchurch City Council never arises again at any time in the future but how other councils district councils regional councils and other territorial authorities might be protected from a situation of this sort occurring in the future. The good news is that lessons have been learnt.Sitting suspended from 6 p.m. to 7.30 p.m.Mr DEPUTY SPEAKER: Tēnā koe e te Whare. Kia ora mai tātou tēnā tātou katoa. The House has resumed. When we reached the dinner break we were discussing the Christchurch City Council (Rates Validation) Bill and Scott Simpson has 4 minutes 20 seconds remaining to speak should he wish to avail himself of that privilege.SCOTT SIMPSON: Thank you Mr Deputy Speaker. I do wish to avail myself of that opportunity to spend a further 4½ minutes speaking to the very good bill that has been presented and sponsored by my colleague and very hard-working MP for Christchurch Central the Hon Nicky Wagner. In saying that I support the bill I do so rather grumpily and that is because prior to the dinner break I was speaking about how this House resists and does not really like having the need to bring retrospective validation legislation before the Parliament. This was a matter that related to incorrect rates motions being passed by the Christchurch City Council during the years 2004-05 through to 2012-13. For those 9 consecutive years although no ratepayers were financially impacted in any negative way nor indeed was the council impacted in any negative financial way more by good luck than good management none the less had a ratepayer chosen to challenge the validity of the rates for any one of those 9 years then the council would have been found legally liable and negligent.One of the problems with retrospective legislation is that it is something that validates something that would otherwise not have been legal. That is exactly the case here. In August 2013 the Department of Internal Affairs alerted the Christchurch City Council. This is not some small territorial authority in a remote part of the country; this is one of our largest municipalities and the internal affairs audit team alerted the council to the fact that there was a problem. To the council’s credit it did attempt to remedy the situation for the future but it was not able to put right the errors of the preceding 9 years. That is why Nicky Wagner the Christchurch Central MP has had to sponsor this local bill on behalf of the council and bring it to the House so that we can put right the dotting of the i’s and the crossing of the t’s that did not occur for those 9 years. This is an example of a situation where I hope other territorial authorities will learn from the mistakes that have been made in Christchurch City and that in future more care and diligence will be shown in the wording and drafting of motions before the council particularly as they relate to rating issues.I reluctantly commend this bill to the House but I thank Nicky Wagner and congratulate her on her efforts in stewarding it through the House.Su’a WILLIAM SIO (Labour—Māngere): I am happy to take a short call on this and join with my parliamentary colleagues on this side of the House particularly from the Christchurch region who will be contributing to this particular debate. I will just begin by cautioning members of the House to just control the emotion that they may feel towards the Christchurch City Council in passing this piece of legislation.The first point I would make is that this relates to technical issues that took place from 2003 to 2013. It is not necessarily the fault of the present mayor or the present councillors. The second point I would make is that we are talking about technical issues. Essentially the council had been doing the right thing except it did not cross the t’s and dot the i’s as expected by legislation. The third point I would make in just cautioning members of Parliament and particularly that side of the House is that I am somewhat sympathetic to the local government sector in our country particularly because when members of this House become scathing of the work that local government does on behalf of its constituents it seems like we are seeing them as an extension of the public sector or a Government department and that is just not the case. I think what we have got to recognise and give due respect to is the fact that local government representatives are elected by the people by their communities to serve and provide the necessary services that the local communities might ask of their local council.Fourthly I agree that retrospective legislation rates validation is something that many in this House are rather reluctant to agree with but in this case precedents have been set. I would also say that when the bill was opened up for public submissions the only organisation that made submissions to this was Christchurch City Council itself. The committee in looking at this piece of legislation made not one recommendation whatsoever to change or amend the piece of legislation. I have to say that to all intents and purposes as far as I can see for my own eyes the council has done the right thing by bringing this piece of legislation to the House to cross the t’s and dot the i’s so that it is within the laws as are required. That also raises another question: often I have heard members of the House ridicule or condemn the local government sector and I am referring mainly to the Government members and I would just ask them to be cautious and be careful with that attitude. Remember that these are people elected by the local community to represent them. It is part of our democracy. These are local governments not a Government department. I am happy to add my voice along with my colleagues in supporting this bill in the House tonight. Thank you.PAUL FOSTER-BELL (National): Might I say that it is a pleasure to speak on the Christchurch City Council (Rates Validation) Bill under the Speakership of such a distinguished and illustrious member of this House. I am taking this call in this debate on the Christchurch City Council (Rates Validation) Bill because as previous colleagues have rehearsed the argument several times I think it is necessary given some of the comments made by members opposite just to repeat them one more time. This is something that we do reluctantly: passing retrospective legislation in this House. I think it was in the second reading debate that I expressed my personal reluctance to consider retrospective legislation unless there is a very good reason to do so. If I may once again refer to the pre-eminent legal theoretician Professor Dicey the former Vinerian Professor of Law at Oxford who talked about retrospective legislation he—Simon O’Connor: Who sorry?PAUL FOSTER-BELL: Professor Dicey Mr O’Connor. He was a very highly respected Oxford legal theoretician of the 19th century—a Vinerian Professor of Law. He made the point that retrospective legislation can either be very very bad or it can be something that is necessary and tolerable. Of the examples of monstrous retrospective legislationthat he used to cite one of the key examples of evil retrospective legislation was the Habeas Corpus Suspension Act of 1794 which was a very unworthy piece of legislation and was most unjust. However he did also believe that it was possible to have curative retrospective legislation to set right something that was done wrong. I genuinely believe that this bill falls into the curative category. It does amend a technical deficiency and as my learned colleague Scott Simpson the chairman of the Local Government and Environment Committee referred to previously in his own contribution on this debate there are no people who will be required to pay additional rates or levies because of this curative piece of retrospective rates validation. In fact the technical deficiency was simply in the wording of the ratings motions which were passed by successive city councils in Christchurch over a period of as many as 10 years.I think it is very important that we do set this wrong right and this bill does so. And to other critics of retrospective legislation I would also refer to recent research that has demonstrated that in the Commonwealth of Australia—a very comparable jurisdictionto our own I suppose—up to 20 percent of legislation carries some form of retrospectivity in it. So this bill is not entirely unusual. We have been here before but one of my main concerns when sitting on the Local Government and Environment Committee was to ensure that we do not end up here again having to validate rates retrospectively for another council in New Zealand. Although we were not able to receive an ironclad watertight guarantee from officials that such an issue could not crop up again in the future I think thatwe can have some confidence our being a competent and very efficient Government on this side of the House—as opposed to the members opposite—that this is one of the last rates validation bills that this House will hopefully have to address particularly in terms of dealing with such an issue in the manner that we are today.There have also been comments made about the competence of the officials who tendered advice to the council over the course of the 10-year period during which the rates were incorrectly set. I am actually prepared to stand by the comments of my colleagues on this side of the House and by the criticisms and concerns that they have. Firstly when the Christchurch City Council appeared before us at the select committee there was a complete lack of contrition. We did not have from the highly paid officials any sense of regret or any sort of apology to the ratepayers of Christchurch or to the taxpayers of New Zealand who are faced with a bill that is probably many hundreds of thousands if not millions of dollars in order to pass this piece of legislation. There was no real apology for the incompetence that has led us to this position. That was in my view regrettable. I do appreciate the arguments advanced by some that the people whom we saw at the select committee the people who were advocating—the only submitters in fact whom we heard on this bill—were not those responsible for the initial error. They were the officials who are the current incumbents and they made the point that the councillors and officials involved with the initial incorrect settings and incorrect motions including the chief executive at the time were no longer employed by the council or no longer served on the council. That is a point that is not entirely lost on me.We do have a situation where taxpayers and ratepayers have been put to some considerable expense and inconvenience in order to remedy the situation so I think that we do need to send a very strong message to officials and councils up and down New Zealand that it is paramount that they understand what is required in the law. It is not actually a huge piece of legislation that they have to come to grips with in terms of understanding the framework within which we set local government ratings in New Zealand. It is very important that they understand it that they understand the technical detail and that they apply it correctly so that we do not end up once again in a situation where we are expending significant amounts of ratepayer and taxpayer money to remedy retrospectively a situation like we have here.There was a question that came up in the second reading debate and I put the question to the Minister and we actually had a very clear answer from the Minister. That question was about what is actually covered by this retrospective validation bill. Not only does it cover the incorrectly levied rates which were levied over a 10-year period from 2003-04 to 2012-13 inclusive but it also covers a number of subsidiary rates and charges that were levied incorrectly as well. These were the Church Bay sewer loan rate the Church Bay water loan rate the restricted water targeted rate the waste minimisation rate and the water fire service connection rate for those financial years; the same as for the uniform annual general charge which was incorrectly levied. I think that the Minister did give us a full explanation and description of that. There is something in the order of $600000 worth of unpaid back rates that should have been paid. The citizens and ratepayers in question did not behave properly in not paying the $600000 worth of back rates which does require this retrospective validation to be enacted in order for the council to be able legally to collect that $600000 worth of back rates. That is another reason why this validation bill is required. I come back to the point that the bill does not prejudice the interests of otherwise law-abiding Christchurch residents who have paid their ratesover those years thinking that they had been correctly levied when as we have now discovered they had not.Just to make things really clear I do want to reiterate some details of the original failure. It was a breach of section 24 of the Local Government (Rating) Act 2002 which is the principal Act that determines how local government ratings are levied in New Zealand. The Act talks about how rates are levied and the fact that they are available to be paid in instalments and it sets the payment dates for those instalments. I think that it is a credit to the people of Christchurch and to New Zealanders in general that there are so few uncollected rates. There is only $600000 worth in a great city the size of Christchurch which is home to many hundreds of thousands of souls and is arguably the second city of New Zealand after Auckland—and obviously the capital Wellington. But I think it is a credit to the taxpayers and the ratepayers in Christchurch that such a small portion has not been paid and there will always be cases I suppose where some people do not feel that they are obliged to meet their full obligations and make their contribution to the running of their city and the infrastructure and services that the council provides.The failure we need to resolve was a breach of section 57 of the Act and was around how penalties are added and calculated to those unpaid rates that were incorrectly levied in the first place. Those two errors are being remedied in this piece of legislation. It is a necessary thing. It is something that we are doing reluctantly. We need to send a strong message to councils that they must get it right to prevent such a waste of parliamentary time in the future. I just make the final point that the retrospective element although best avoided is something that in this case is necessary and curative. For all those reasons I commend this bill to the House.EUGENIE SAGE (Green): I am pleased to take a short call on the Christchurch City Council (Rates Validation) Bill and it will be short given that it costs over $21000 an hour for the running of Parliament and that there is wide support across the House for this technical bill. Yes it is retrospective but I would agree with Mr Foster-Bell that it is curative and tolerable while retrospective. The Green Party is supporting this bill because the mistakes that the Christchurch City Council made in its rates-setting resolutions were not deliberate. They were simply in the wording of the resolutions. They did not affect the amount of rates that Christchurch folk had to pay nor the penalties that ratepayers were liable to pay for delayed payment or non-payment.I think we should be very careful in this House not to throw stones. It is a wooden House rather than glass House but tomorrow we will be debating legislation that corrects a mistake made in the exclusive economic zone legislation. So this Parliament often has to reconsider legislation that was not fully considered during select committee consideration and during the House debates so it is not unknown for errors to be made.The mistakes that the Christchurch City Council made in its resolutions were in relation to the payment dates for rates and the authority to impose penalties on unpaid rates. That raised issues with the validity of collecting the rates and the penalties for non-payment. So the bill validates the payment dates and it validates any penalties that have been added to the rates. It ensures that all the money the council has received in respect of the rates is lawful and always has been lawful. As Mr Foster-Bell noted it relates to some of the uniform annual charges and some of the targeted rates and loans for Church Bay and Governors Bay for wastewater and water supply schemes.One of the issues this bill did not go through is that there is a $683000 hole in the council’s revenue stream. If the bill was not passed the council would be liable to legal challenge and it would not be able to chase up the 38 ratepayers who have not paid their rates and who are liable for penalties without the risk of a legal challenge. That would impose quite significant extra costs on the council which has already got funding problems so we have no substantive issue with supporting the bill because the mistakes were not deliberate—they were procedural—and we are resolving an issue that should be resolved and that the council has brought to the attention of the public and of Parliament at the first opportunity after those mistakes were discovered.But although the council has been able to come to Parliament to get those issues resolved it will not be able to come to Parliament as easily if it proceeds with its very short-sighted decision to sell off major council assets like the port company the airport and Orion which have been major contributors through the dividends that those companies provide to keeping the council’s rates low. The $43 million in dividends that are coming to the council in the 2015-16 year means that rates are 13 percent lower than they would otherwise be. The Green Party considers that it is incredibly short-sighted to be pushed—as the city council is being pushed by the National Government’s failure to renegotiate the cost-sharing agreement to meet the $400 million shortfall in the costs of preparing the horizontal infrastructure—to consider selling these revenue-generating assets in order to fund a potential white elephant like the stadium which is likely to lose revenue. So we support the bill but we oppose the proposals in the city council’s long-term plan to sell vital revenue-generating assets. Thank you.RON MARK (NZ First): What more can be said about this bill? It is a very short bill—a couple of pages but it certainly has generated some—[Interruption] Sorry?Simon O’Connor: You can do 10 minutes.RON MARK: You think I can? We will give it a lash shall we? It is a very short bill and its intent is very clear. For those who might have missed it and going straight to the core which really is at the guts of this bill what this bill does is pretty much contained in Part 2. Clause 5 as has previously been said validates the payment dates for the rates. Clause 6 validates penalties added to those rates. Clause 7 declares all money received by the council in payment of the rates and any penalties paid in respect of those rates to be and to always have been lawfully paid to and received by the council. Those are the interesting words to me—“to be and to always have been lawfully paid”—because they were not were they? They were not lawfully paid and that is really what the nub of this bill is and why we have spent so much time in the House why people went down to Christchurch and put a lot of time and effort into drafting hearing and taking submissions and moving this bill through three stages in the House.The words “to be and to always have been” almost sounds a little bit Shakespearean does it not? “Lawfully paid”—“lawfully paid”. Would it not be nice if some of us could actually pop along to the supermarket and say: “Well you know I came in the other week and I picked up some groceries. I’d just like you to consider that they have been and always had been paid for.” It is a little bizarre maybe a little bit Shakespearean.Stuart Nash: It’s like amalgamation of Carterton’s.RON MARK: It is like amalgamation—something that boggles the mind as to how people could actually come up with these things or how people could make simple mistakes. I guess. I do take on board some of the cautionary comments by my colleague on my right Su’a William Sio. It is tempting for someone like me who has come from a small council Carterton District Council which is a council about which certain people out there on the hustings and some people in this House have advocated the view that it is too small to run itself it could not possibly manage its assets and it could not possibly comply with all the intricacies of the Local Government (Rating) Act. Therefore on those and numerous other spurious arguments they say that it needs to deserves to and should be swallowed up into and run by a larger council.Well we have never done this. We have never made mistakes like this. Masterton District Council has never made this mistake. If people really want to get their heads around what is happening out there in rural and provincial areas with small councils and how well they are managed and how they do not end up in situations where money you have sort of paid is deemed to be and always has been lawfully paid they should really pull out the latest Bell report and have a quick read. The Bell report is really quite staggering in its revelations that some of the top-performing councils in this country are actually some of the smaller ones. Small rural and provincial councils are being run well and do not require the time of this House to retrospectively pass legislation to correct their mistakes.I will acknowledge this: the current Mayor of Christchurch was not the Mayor of Christchurch when this happened. The current chief executive officer was not the chief executive officer or was not one of the chief executive officers who was in charge of the Christchurch City Council at the time that these mistakes were made. The credit for that lies with other people. But I have to make the point that people who are elected into council whether they be councillors community board members mayors or deputy mayors do notat the time of their election and appointment—and for some of them even a few years after that—actually come to grips totally and 100 percent with all the procedural requirements that go with the job particularly at the time of the annual planning and consultation phase particularly when you are taking submissions on an annual plan setting rates—sewerage rates targeted rates uniform rates. They are not 100 percent au fait with that procedure and it is up to the chief executive officer and his senior managers to guide and steer those councillors the mayor and the deputy mayor in the procedures and the protocols that they must follow to comply completely 100 percent with the Act.I will say that again: it is up to the chief executive officer the chief financial officer and the other entourage of senior managers who get paid hugely well particularly in Christchurch. I remember well the controversy over that particular chief executive officer who gave himself a pay rise because he thought he was doing so jolly well. Here we are in the House with all parties in the House putting all of their time into correcting something that the chief executive officer of the Christchurch City Council should not have allowed to happen. On top of that I remember the visits by the Audit Office and how my council would ramp itself up and get ready for that visiting team of auditors. We would have a preliminary interview with the chief auditor—the mayor the chief executive officer the deputy mayor and the chair of the Audit and Risk Committee. We are talking about little Carterton here; we are not talking about New York. We would do that and we would get a clear picture from the chief auditor of that team which might comprise a team coming in—and you know we are talking about a council of 8500 people—that might be three four or even five strong.That team would outline what it was that they were going to go through and what they would be looking for. Well clearly the audit team that went through Christchurch—for year after year after year—did not check the procedures by which Christchurch was implementing its rates charges. It did not audit those procedures. I know from talking to the Audit Office and we have had hearings and discussions at the select committee that people have got a different focus now. I know that in any one particular year the Audit Office will come in with a theme. It will come in and say: “These are the things we are going to be looking at.” But for this to have gone onyear after year after year and to be left undetected and for us in 2015 to be sitting here in the House this evening past my bedtime—I am joking—passing this legislation through the House is unbelievable really particularly with a council that size that employs that many people in senor manager appointments and pays them what $400000 or $300000? And it pays an audit office—what—what was that last bill? Well it certainly was not $90000 which is what Carterton pays. It was $200000 in one year for the audit to be completed and for the council to still miss this mistake. So here we sit.Like many of the other parties in the House and the other speakers before me New Zealand First has to put on record that it really struggles with retrospective legislation. We do not think that it is really ideal. I thank Paul Foster-Bell for his comment that 20 percent of the legislation that goes through this House—good homework there Paul—is retrospective. We do not like it. We particularly do not like it when highly paid senior managers of a council are not doing their job and are not advising their mayor their deputy mayor their chair of the Audit and Risk Committee and their council as appropriate and we end up in this situation.I would say—what can I say to finish off?Stuart Nash: It wouldn’t have happened when you were Mayor of Carterton.RON MARK: It would not have happened if I had been Mayor of Christchurch. I would say please when we are having this conversation and debate about bigger is better and bigger councils get things right and small councils struggle—when we are having this argument and this debate about economies of scale—I would like the House to remember this: the reason some small councils do not make mistakes like this is that the very small budgets that they have for them makes them very sensitive to expenditure and very sensitive to error particularly errors that cost money. The rule of thumb we used in Carterton was this: for every $80000 you spend over and above what was budgeted last year that will result in a 1 percent increase on your ratepayers. Can you honestly justify that 1 percent increase? When you are dealing with big councils like the one in Auckland’s super-city $80000 is postage money for 1 day. It does not mean anything. It does not make councillors blink it does not make their eyes water and therefore they can—I guess understandably—lose sight of the detail lose sight of the protocols and procedures they should be following and they can make mistakes. Let us hope it does not happen again.JOANNE HAYES (National): I rise to take a call on the Christchurch City Council (Rates Validation) Bill. I must say after listening to that kōrero from our colleague across the way over there Ron Mark that I agree with him. I agree with him. The mistake that was made was not made by the current mayor it was not made by the current chief executive officer; it was made by all of those who went before her. But the thing is once you take on those positions and those posts you do inherit unfortunately all the rubbish that had happened prior to you coming in there. I think that when we elect our mayors and our councillors those are some of the things that may come up. I am not a fan of passing retrospective legislation through this House either. However that is the position we are in with this Christchurch City Council (Rates Validation) Bill and we need to keep going with it and get it through the House.I think that with a lot of what you said Mr Mark you hit the nail on the head when it comes to past histories of that particular council and the accountability of its chief executive officers. At times it looks like the bigger councils get the more complicated it is to manage and messages stop getting moved around. I think that for Christchurch City that is basically what happened—messages were not getting to the people. Was it incompetency? What was it? We will not know. All we need to know is that we are going to move this one forward.I guess that is why this Government has been doing a lot of work around establishing prudent benchmarks that require councils to produce 30-year plans and strategies. Councils now have to provide information to their ratepayers about everything that they are doing so that the ratepayers can actually judge the council’s performance. That is really key. I am not a ratepayer of Christchurch City—yet. I am a ratepayer of another smaller district council and these are some of the things that I ask my councillors who represent our area: “OK we voted for you so what are you doing? What type of job are you doing? What kind of job are you doing for us as ratepayers and how are you measuring it?”.There is a lot to be said around performance measures of councillors and their workers and how councillors get around the table to do performance management of their chief executive officer. I had no idea about that type of work but it is one of those things that I learnt. I come from a small NGO and we had to do that. As Māori NGOs we had to do that with all of our staff and our boards had to do that with managers like me. I guess there are a lot of lessons to be learnt from the small groups—that is if they have good performance management systems then maybe the big ones could actually learn from the small ones.Ron Mark: Would we do this for a small NGO or a small council? No we wouldn’t would we?JOANNE HAYES: No but the point is we are dealing with that legislation now for Christchurch CityCarmel Sepuloni: The point is the National Government’s shutting down all those small NGOs anyway.JOANNE HAYES: Oh no no no no no! We are talking about this council and that is where we are going to stay.We are reducing red tape for councils. That is what our role is and I can tell you right now that one of our key projects happening within the local government area has been our Rules Reduction Taskforce. It is an amazing task force that is going around all the local government areas seeking input from ratepayers and from people who are interested who may not be ratepayers but are still affected by some of the things that are happening in their cities or their towns—especially around the regulations rules and laws that that particular council has. So the task force is asking for feedback.Recently I hosted one of those Rules Reduction Taskforce meetings in the Christchurch East electorate. It was very interesting to hear about some of the red tape issues that some of these developers and some of the people who were redeveloping their homes were actually going through—the really minute things. The task force was led by Jacqui Dean and sponsored by Paula Bennett and was looking to actually help ratepayers. We are actually there to help ratepayers into the future to make sure that their cities and their towns are actually working for them and that is what it is all about.So when we start to look at the Christchurch City Council (Rates Validation) Bill we start to ask what it is. What are the sections? What are the sections that require the rates to be set—the resolutions of the council? The resolutions must specify the financial year to which the rates apply—I am repeating this I understand that. I understand that I am repeating this but I do so because it is really key. I am hoping that other councils which may or may not be perhaps heading down towards the same situation can actually look at some of the things that they are doing and the way they set their rates and are making sure they are using this as a tick box to make sure that they do not end up in the same situation. So we are looking at the financial year to which the rates apply the date on which the rates must be paid and/or if payable by instalments the payment dates for each instalment the penalties to be added to the rates not paid by the due date and how these penalties have to be calculated.Some of the irregularities made by the Christchurch City Council under the Local Government (Rating) Act 2002 include a failure to state in the rates resolution that the rates would be payable in instalments by certain dates. These rates resolutions also failed to state the penalties that would be added to the rates if they were not paid on the due date and the rates that were to be assessed in the previous year that remained unpaid. So the dates that the penalties were to be added to the unpaid rates and the amounts of the penalties that would be added—all of these things were actually missing from within the rates resolution.In addition to the irregularities we also had areas that included the failure—and my colleagues here have already stated it but I am going to state it again—to state the Church Bay sewer and water loan rates system. All of these were provided within the Christchurch City Council’s funding impact statement—everything that I talk about from here on is provided in the Christchurch City Council’s funding impact statement. It failed to state the Governors Bay sewer and water loan rates as a fixed amount and it failed to state that the liability for the restricted water target rates was calculated on the level of service through a restricted water supply system. It failed to state that the water minimisation rate was set as a fixed amount per rating unit as provided—Hon Member: It was very serious.JOANNE HAYES: Yes it was very serious. I carry on. It failed to state that the water minimisation rate was calculated on the number of separately used or inhabited parts of the rating unit and it also failed to state the water fire service connection rate. Finally it failed to state the uniform annual general charge which was to be calculated on the number of separately used inhabited parts of the rating unit.So again in order to address those procedural irregularities this bill validates the payment rates for the rates set and assessed by the Christchurch City Council between 2003 and 2013 and validates all the penalties added to any validated unpaid rates between 2003 and 2013. It validates the basis on which certain specified or targeted rates were calculated for the rates in the years that were set out as I have just stated. It also declares all moneys for the Christchurch City Council in relation to validated rates and penalties to be lawful because prior to that they were not. Finally it provides that any unpaid rates or penalties in relation to any of this would be made lawful and would be recovered by the Christchurch City Council.We have all learnt something tonight have we not? We have all learnt something tonight. I just want to take this time to take a bow because that is what you have all heard from this side of the House.Hon Member: They’re just touchy.JOANNE HAYES: They are just touchy. And we need to keep on reiterating that because we do not want retrospective bills from councils coming through this House again as my colleague Paul Foster-Bell outlined in his wonderful speech before.Let us carry on because I know you are getting very engaged in what I am saying. I can seethat. When you put your hands up like that it means you want more and I am going to give you more. The select committee received only one written submission on this bill from the Christchurch City Council. [Interruption]Mr DEPUTY SPEAKER: Order!JOANNE HAYES: And they were also—Tim Macindoe: I’m sitting here and I can’t hear a word.JOANNE HAYES: Do you want me to start again?Tim Macindoe: Yes please.Hon Member: From the top.JOANNE HAYES: From the top. So the Christchurch City Council—here we go—also made an oral submission so it is good that it is supporting this bill. The council was promoting this bill and the grounds on which it was introduced. The council recognised there was a mistake. Let us not blame the current mayor. Let us get this bill through and perhaps the Christchurch City Council can then concentrate all of its time on the redevelopment of New Brighton. Kia ora.Mr DEPUTY SPEAKER: I call Rino Tirikatene.Ron Mark: Move an extension of time.RINO TIRIKATENE (Labour—Te Tai Tonga): As much as I would like to move an extension of time I think that member deserves a drink. We all do—absolutely.Tim Macindoe: We’ll all need one by the end of this.RINO TIRIKATENE: Well we will wait and see. I am pleased to speak in support of the third reading. I looked back at my earlier contributions on this bill and I was quite critical of the Christchurch City Council and the officials in the 9 successive years where they basically broke the law and did not comply with the Local Government (Rating) Act. But I think I have said my piece. I know that the Christchurch City Council has got the message loud and clear. Can I acknowledge the council though for fronting up to Parliament acknowledging its mistakes and going through this process to correct the errors and the illegality of its actions.I want to make just a short contribution and rather than being critical of the Christchurch City Council I will just say that the errors that were made are there for everyone to see. The council has come to Parliament to correct them and through retrospective legislation we are doing so. But I would hope that this piece of legislation is a message I guess to all local government in New Zealand the 78 local authorities that we have up and down the length and breadth of our great country—the regional councils the territorial authorities and all the different types of councils that we have such as district councils city councils and unitary councils. Hopefully this is a lesson for all of them—please make sure you comply with the law. It is not hard. When you are setting your rates just follow the requirements in the legislation and make sure that you are doing everything by the book. When you are passing your resolutions make sure you are actually including everything that is required to be put in the resolution. It is not hard.I know that this is an area where Local Government New Zealand is wanting to improve the performance of local authorities around the country. This is one area where they can definitely improve on their performance. I ask them to please take the time. I ask them to do what Mr Ron Mark did when he was the Mayor of Carterton—they made sure they complied with the law they passed their resolutions and they included all of the correct information to ensure that it was compliant with the law. That is really my message to local authorities around the country. Please make sure you follow the requirements the compliance checklists. It is not hard. Make sure that you put everything in the resolutions because otherwise we may be forced to sit through more contributions like we have had tonight.We have heard about Shakespeare we have heard about neoclassical architecture we have heard about all sorts of stuff in this debate. Unless the good people of New Zealand want to sit through more corrective patch-up legislation please local government across New Zealand make sure you follow the law pass your resolutions make sure they are all complete cross the t’s and dot the i’s and then we will not be wasting our Parliament’s time on putting through unnecessary legislation to correct something that should not have happened in the first place. Regrettably there are times when Parliament has to step in.Let us hope there is not a concerned citizen or ratepayer going through their local government official information wanting to get copies of all the resolutions that were passed and trying to marry them up. We know that some people out there might do that. Certain ratepayers are quite pedantic. Let us hope that more of these errors do not come to light because if it has happened with one of our major councils the Christchurch City Council let us hope that the 78 other local authorities around the country have all been compliant in passing their resolutions. Thank you.MATT DOOCEY (National—Waimakariri): It is a great honour to rise for the first time to speak on this bill the Christchurch City Council (Rates Validation) Bill in its third reading. I must admit that I feel like I have been on the highs of the Arts Centre of Christchurch Trust Bill and the lows of this rates validation bill. It is legislation that is very important to me as the electorate MP for Waimakariri. A lot of people think that the electorate actually mirrors the “Waimak” district borders but in fact my electorate covers part of northern Christchurch Northcote Redwood Belfast and Northwood and about a quarter of the population of my electorate live in the Christchurch City Council zone. So it is a very important issue for my constituents and it is a very important issue for me.I must join with the rest of the members of the House in acknowledging the work of the Hon Nicky Wagner who has brought this local bill to the House tonight. She is a very hard-working Minister who has shepherded what could have been a very controversial bill through the legislative process. You very much see why that Minister has turned a red seat blue. Can I also acknowledge the chair of the Local Government and Environment Committee equally for shepherding the bill through a process that could have been very controversial.I do acknowledge the sentiments from the other side of the House about respect for local government. My late grandfather was on the Christchurch City Council for over 30 years in the 1960s 1970s and 1980s and he spent several of them as Deputy Mayor of the Christchurch City Council. Probably that is where my political ambitions hark back to. I very much respect the people of his ilk—that it was about civic service and civic duty. So we must be mindful of that when we do critique local government performance.But in saying that we should not reward poor performance. If you do not challenge something then you are complicit in it. So I think it was very well summarised by the Minister when she introduced the third reading and she said that the bill although controversial was simple straightforward short and very focused. I mean at first I did not know whether she was talking about me or Ron Mark but she is quite right. It is a controversial bill. It is simple straightforward short and very focused but it could have caused a lot of issues for the Christchurch people. I must say that that is the last thing Christchurch people need at the moment. I do not need to rehash the last few years but we all know it has been a very difficult time for people in Christchurch and of course in the “Waimak” and Selwyn as well. So it is quite right that we take a very diligent and thoughtful approach with this legislation.What we do know if we look at it in some detail is that every June the council resolves to set its rates for the next financial year. We know with this rates resolution that it did not meet the requirements. And the Minister referred to this—the issue that arose from trying to put things in simple language. I actually have some sympathy for this. In my previous career in mental health I managed a drug treatment service in London for the London Borough of Barnet a local authority in northern London. It had a policy of having simple English to make it accessible for people to engage with information and literature. But of course when you are talking about technical information sometimes if it is simplified you do lose a lot in translation. So I can understand how this may have happened but at the end of the day like I say we cannot reward poor performance and if we do not challenge something we are complicit in it. So we do know that all the required information was available in policy and newspapers but just not in the set resolutions and there were other technical issues around targeted rates. We have heard a lot tonight about the issues around retrospective legislation.So overall I think that with the issues at hand for both the leadership of the Christchurch City Council and of course the Waimakariri District Council and the Selwyn District Council as they lead through the recovery we just need to be mindful that we do need positive relationships in central and local governments. I want to thank our chair Scott Simpson for holding the select committee hearing down in Christchurch for the day. Not only did we get the opportunity to go to the Christchurch Arts Centre which was a valuable trip but we also got to hear the submissions around this bill. There was only one submission as people have spoken previously about and the councillor who did turn up was Glenn Livingstone. I know there have been some comments about his performance in that submission but I would like to say that in my dealings with that councillor he is someone who is very humble and very hard-working in his region which is primarily in eastern Christchurch. We know they were hard hit by the earthquakes and councillor Livingstone and councillor East are doing a fantastic job out there. But it was good to see that overall there were no ratepayers who were affected by this and what we are doing is just validating the resolutions retrospectively for about the last 9 years—2003-04 to 2012-13.It is a tough job for the Christchurch City Council. I was on Chris Lynch’s radio show on Monday morning with my colleague Clayton Cosgrove talking about the political issues in Canterbury. Quite often we are asked to comment on local government performance and on mayors but I must say that it is not really our place to give a running commentary too much on their performance. But it was a great opportunity to take the select committee down to Christchurch and see what is happening down there. There is a lot of hope—there is a lot of hope—and I must say that at the end of the day we are delivering in Christchurch. The previous speaker from the Green Party Eugenie Sage mentioned the white elephant of the rugby stadium which I thought I had to pick up on because at the end of the day Canterbury is the best rugby region in the world and we need a stadium to reflect that like the Hagley Oval—[Interruption]Thank you very much. Can I just say just to summarise really that we are one region one Canterbury and I am very happy to be one-eyed. Thank you.POTO WILLIAMS (Labour—Christchurch East): I have to make just one quick comment before I get into the substance of my speech today and that is to say that the contributions from the last two National Party members have been really really dreadful. I also have to say that those last two National Party members who contributed were also the two people who stood in the last two elections in Christchurch East and lost—to me. So I just wanted to remind you with that little lesson.This bill is about people who are elected who have to be accountable for things that they may not have been responsible for. This is what this bill is about. All of us who are elected to public office know that at some point we may have to be accountable for the actions of those who have preceded us. That is exactly what this bill is about.I know that some of the members of the Local Government and Environment Committee have been a little harsh in their comments about the officials from the council who presented to the select committee. They were expecting them to be really overwrought in their desire to get this bill passed and really be grovelling I think is the term I want to use. Well actually what they have done is a really sensible thing at a time when their council is under some pressure. Let us face it: it is probably one of the most difficult jobs going at the moment—being a councillor on the Christchurch City Council—and it has been for the last 4 or 5 years. So for the select committee to be scathing of the attitude of the officials who presented is I think a little bit rich.While I am on that note I do want to send my greetings to the Christchurch-elected representatives to the hard-working councillors and to the community board members who might be listening tonight to this bill finally being passed so that they can get on with their jobs. They are going through a particularly busy time. They are hearing submissions on the long-term plan. I want to acknowledge the work that the hundreds of submitters from the Christchurch East electorate have done into that long-term plan with many of them wanting to ensure that the New Brighton community becomes once again the jewel in the crown of Christchurch City. I want to acknowledge all the hard work that they do that they have been doing and all of the hard work that the Christchurch city councillors and community boards have done.Let us face it: it has been a difficult time but in the midst of all of this difficult time the acting chief executive Jane Parfitt found a problem. Back in 2002-03 in an attempt to have a plain-language solution to the ratings language the council made a bit of a mistake and it did not actually include as my colleague Su’a William Sio says all the dotting of the i’s and the crossing of the t’s. But it took a very busy acting chief executive officer at an extraordinarily busy time—a very busy chief executive officer at a very busy time—to find the error and to ask for our help to put it right. And it is our job to do what we need to do to ensure we can validate those rates so that the council can be sure that it can use those rate payments that were collected in the manner that it should. But not only that the council also needs to ensure that it can provide for the collection of rates that were not collected during that period. From those I think 38 or so ratepayers owe in the vicinity of $600000.So that is what this bill does. I am not going to speak too much further on it. I think what we should do is get this bill passed so that we can get on with the job in Christchurch. I thank you Mr Deputy Speaker for permitting my contribution. Thank you.NUK KORAKO (National): E mihi atu ki a koe e te Mana Whakawā. Huri noa e te Whare tēnā koutou katoa.Pita Paraone: Tēnā koe.NUK KORAKO: Kia ora. It is again my pleasure to stand to take the final call on the Christchurch City Council (Rates Validation) Bill. I am not going to relitigate a lot of the topics around the speeches that have been done over the process of this bill. But I do want to acknowledge on both sides of the House here this evening the real quality of the speeches and particularly listening to a former mayor listening to a very active Auckland MP Mr William Sio and also from this side of the House as well. I would like to acknowledge as the final speaker the sponsor and the driver for this bill the Hon Nikki Wagner the National Party MP for Christchurch Central and also the chairman of the Local Government and Environment Committee Scott Simpson and all of our colleagues actually who sit on this committee.I do not believe in listening to the last speaker Poto Williams that the select committee has been ungracious. I do not believe a lot of the descriptions in some way about how we have handled this bill. I think it has been professional and it has also been a bill that we all understand. I mean listening tonight listening over the last two times the bill has come to the House for the first and second readings—it is that the words that we are hearing have commonality. Reluctance retrospective legislation regretful emotive blame and blasé are the terms used for councillors. But at the end of the day I certainly feel that we have the commonality to agree with the fact that this is what happened and we are here to address it. The city council which was the only submitter has put up its hand and has said yes—and past councillors. It is our responsibility and it is our duty to put this right. On that basis I think that we have a clear direction on how we are actually going to vote for this bill.I think it is important too to remember that after the situation was first identified—and this was according to three or four mayors whom I spoke to—almost every council across New Zealand actually then suddenly stopped and looked back at its processes around rating processes. That was a catalyst that this situation created so that everyone could ensure for themselves the fact that their processes were correct so that they could give their constituents their ratepayers the confidence that they deserve. That is very much an overview of the bill itself but I think that we need to also look at the council itself. I remember Glen when he came to submit on behalf of the council. When you understand—and particularly those who do not come from Christchurch who are not actually there day in and day out who actually have not lived through the last 4 or 5 years of the incredible upheaval the disruption and all of that that is going on in this city—that it is our council and they do a tremendous job.I want to just spend one part of this speech to say that yesterday was a very significant day. Yesterday: “Leri era Italia Giornata Nazionale”. What that means is that yesterday was Italian National Day. I am bringing this up il Capo because of the fact that—if you read an article in the Christchurch Press on the weekend—it was the former chief executive officer of the Canterbury Earthquake Recovery Authority who had actually visited the city of L’Aquila. In that city in 2009 they had over 300 people who actually lost their lives and 65000 people were homeless. If you compare what they have done in Italy with Christchurch well then you will see how hard this city council is working. But also one of the things is that the recovery is in partnership with the Crown central government the regional council and also the Christchurch City Council iwi and all the major stakeholders. When you compare us with what is going on in Italy all the usual suspects—corruption hold-ups all of this you know leadership problems—are things that we do not actually experience here.Finally just to highlight in this bill the incredible assistance that this Government has given to the city of Christchurch it is reflected in the fact that in the 2015 Budget another $100 million was given to the Christchurch rebuild which brings it to $16.5 billion of taxpayers’ and ratepayers’money. That says a lot. That is almost 40 percent of the total estimated cost of the Christchurch rebuild which is in excess of $40 billion. In tying all of that together our council the Crown the Government the regional council and all the major stakeholders are really a shining light another beacon to the world on how we actually work together. This is a reflection—I am looking at both sides of the House—that we support this bill in its third reading. On that note just to finish off is the fact that I would like to again acknowledge all of the contributions here this evening and to commend this bill il Capo to the House. Kia ora.Bill read a third time.