Tasman District Council (Validation and Recovery of Certain Rates) Bill — In CommitteeText is incorporated into the Bound VolumeTasman District Council (Validation and Recovery of Certain Rates) Bill — In Committee[Sitting date: 12 March 2014. Volume:697;Page:16607. Text is incorporated into the Bound Volume.]Tasman District Council (Validation and Recovery of Certain Rates) BillIn CommitteePreambleJACQUI DEAN (National—Waitaki):I rise to speak on the Tasman District Council (Validation and Recovery of Certain Rates) Bill. The Local Government and Environment Committee gave this local bill in the name of Damien O’Connor pretty good consideration in its time at the committee. The committee listened very carefully to a number of submitters who were affected by this bill. It was really sympathetic to the submissions of the people who cared enough to put a lot of time in to coming to Wellington or perhaps giving us a videoconference in support of this bill or indeed in opposition to the bill.There was the desire to delete clause 9. We decided that this would be outside the scope of the bill so the technical amendments were made for consistency to clauses 5(a) 6 and 9 to replace “declared to have been” with “declared to be and to always have been”. Without validation of this setting of the rates the council would be required to undergo a good deal of work that was retrospective in nature around things like determining which ratepayers had actually paid the 2006-07 rates and the amount they had paid. That time 2006-07 was 8 years ago. It was a long time ago in the council’s record and also in the ratepayers’ records. Of course they are not required to keep those records for that long. The council would also have to ascertain whether the current ratepayers were the same ratepayers who occupied those properties in 2006-07 and that is a nightmare in itself.It is something we did consider. The council would be required to apportion rates if there are or were multiple owners of properties. Again the nature of ownership of properties can change substantially over time. Then the council would have to write to each ratepayer advising them of the amount of the refund and requesting bank details for repayment. So it was decided by the committee under the leadership of Nicky Wagner who I know is waiting to take a call—Scott Simpson: A very good chair.JACQUI DEAN: Actually Nicky is an excellent chair of the Local Government and Environment Committee and she runs a very collegial environment in the committee which enables the committee to discuss some quite thorny issues. I am happy to say that on this particular one the committee was pretty united in its care for this bill. The committee also determined that any merit of setting a stormwater rate was we decided outside the scope of the bill and that that is a matter that the local authority would have to deal with separately.In essence this bill is about validating certain rates that were set incorrectly during the period of 2003-04 and 2008-09. The Tasman District Council is not alone in having made a mistake of this nature—not exactly the same perhaps. But this kind of critical decision-making by its very nature is critical because if it is not set correctly then we are faced with a retrospective validation bill like this and Parliament I believe is not of the mind to really support this kind of bill. It is a situation that has been brought to us on behalf of the local council and its community so we have got to deal with it. So we are dealing with it.Maggie Barry: Yeah.JACQUI DEAN: Well where does the buck stop you know? The council has been charged with some important decision-making. It has made errors in that so it falls to Parliament to correct them. Damien O’Connor has done a very good job in keeping the lines of communication open between the council its ratepayers and the committee under the chairmanship of Nicky Wagner.Without doing the validation the council will always be vulnerable to challenge from ratepayers over their incorrectly set rates. If it were me—I am a ratepayer—and my rates were incorrectly set I would be ropeable about it. I would be ropeable about it because every 3 years I do vote for my councillors who then select a mayor and I would like to think that they run a pretty tight ship. I would like to say that this Government’s Better Local Government reforms have a very strong push towards enhancing the decision-making capability of councils. I would also like to say that Local Government New Zealand and the Society of Local Government Managers share that desire. I am sure that the Committee would agree that we do not need too many more of these bills but having said that I believe that we have got this one in pretty good shape and I commend it to the Committee.Su’a WILLIAM SIO (Labour—Māngere):Let me just acknowledge my colleague the Hon Damien O’Connor for ushering through an issue that is obviously very important to the people of his particular electorate. It is also an issue where nobody wins at the end. Sure we are validating this bill the Tasman District Council (Validation and Recovery of Certain Rates) Bill to allow the Tasman District Council to rectify a mistake it made. If we did not do that however the council would still need to find the money somehow and the council would still need to depend on ratepayers.In saying that I have to say that from what I have heard from colleagues in this Chamber most of us are reluctant participants in this affair. Most of us support the bill with a great deal of reluctance particularly when we are validating a mistake made by a council. I can imagine how the ratepayers who brought this mistake to the attention of the council and to this House must be feeling at this particular point in time. I would just say to the council that despite the authority and the power that it will be able to wield with this particular piece of legislation it is still charged with the care of and responding with some responsibility to the people who brought this wrong before the council.I am not going to try to dictate to councils what they ought to be doing but they do need to recognise that their ratepayers the people in that city in that town area who are dedicated to their council—if they were not dedicated to it they would not have brought this to their attention—will have a right to feel some sense of grievance about the wrong that has been done here. I think that the council needs to not be just holding up this piece of legislation once we sign off on it and say that this is what it is going to do but has a responsibility to meet with the ratepayers concerned and try to accommodate the circumstances they face.Despite my name being on the committee report I unfortunately did not get the opportunity to hear a lot of the submissions that were presented there. I did not get an opportunity either to meet the ratepayers who had brought this to our attention. So I simply say to my colleague and the council listening that I think they still have a responsibility to meet with the ratepayers concerned and to attempt to find some accommodation in the concerns or issues that they have raised as a result of the mistake made by the council.I want to turn to the technical amendments and ask my colleague this. The technical amendments suggest that the committee looked at clauses 5(a) 6 and 9. However I would like to know whether my colleague and the council—which is his council—are OK with clause 9. The committee did consider it and it was advised that that was outside the scope of the bill but I am wondering why it was raised in the first instance anyway.I want to respond briefly to the comments made by the previous speaker Jacqui Dean about Better Local Government. This is not the time to be promoting a policy—[Bell rung]The CHAIRPERSON (Eric Roy): I apologise. I got a little bit confused as to where I was and I gave the member a 1-minute bell. It was my mistake. I have been under pressure lately. I apologise. You have 1 minute.Su’a WILLIAM SIO: I accept your apology Chair and thank you for giving me that 1 minute’s notice. I would say to the previous speaker that I would be very careful about promoting Better Local Government because as I go around the country and meet up with mayors what they are saying to me is something very very different from what the previous speaker said. In fact some have said to me that the Better Local Government policy is really quite deceptive because it is more about removing democracy from local government. At a period of time when local government is under attack these kinds of bills just do not help the cause of local government. Just briefly this is a period of time when local government is under constant attack by the reform that this Government is driving. It was only the other day that mayors felt that they had to meet in secret to try to force the Minister of Local Government to come and listen to their concerns. That is not a good sign. It is not a good sign when local government mayors have to try to force the Minister of Local Government. It is her job to be listening to mayors and I understand that she did not bother.Hon Ruth Dyson: Who is the Minister?Su’a WILLIAM SIO: The Minister of Local Government now is Paula Bennett but I think she is just the face of local government. I think there are probably others behind the scenes who are trying to drive this undemocratic what they call Better Local Government.Coming back to the bill though these kinds of bills do not bode well for this House and for local government in particular particularly at this time because I suspect that members of this Government would probably be going around the country holding up these bills as examples of why they feel vindicated by not trusting local government more and more.Anyway I commend my colleague again the Hon Damien O’Connor. What a wonderful member of Parliament he is championing the cause of ratepayers and recognising his duty to those voters in the district of Tasman and may I wish him all the best in the coming election on 20 September.Hon PHIL HEATLEY (National—Whangarei):Back by popular demand I would like to thank the Hon Damien O’Connor for bringing this Tasman District Council (Validation and Recovery of Certain Rates) Bill to the House on behalf of his constituents. As I spoke about in the first and second readings it is very important that we put to bed this particular issue and the issue around the rates payments in the Tasman District from 2003 through to 2008. Of course the preamble neatly summarises the mistakes—what ought to have happened in council meetings in that period what actually did happen and where the faults are. So essentially this piece of legislation and preamble talk about the 2003-04 years right through to the 2008-09 years when the council passed rates attached to the annual plan rather than ratifying each rate individually which needs to be done under the Local Government (Rating) Act and setting rates before the council had actually adopted the annual plan. That was the second big mistake; it was also in breach of the Local Government (Rating) Act 2002.The rating Act provides an avenue for councils to amend and correctly set rates but the window for that has now passed. Whether that was because the errors were not picked up quickly or because they were set aside as unimportant or were in fact ignored we do not know. What we do know is that this House reluctantly now needs to pass this retrospective legislation to ensure that what is unlawful in that rates setting is now lawful. So the bill is needed to validate certain rates set incorrectly during that period. Without validation the council remains vulnerable to legal challenge from ratepayers and validation is also required to allow the council to collect or recover unpaid rates and penalties for expenditure that it has undertaken during that period.Looking at the preamble here I think that by way of example it is worth working through the errors that were made in that 2003-04 rating year. I am not going to go through the 2004-05 year or the 2005-06 2006-07 2007-08 and 2008-09 years but I think that by way of example the 2003-04 year is a good one to start at and to examine. In that particular year a special council meeting was undertaken. It was held on 26 June 2003—the birthday of many New Zealanders I am sure.The Tasman District Council resolved amongst a whole bunch of things first of all that the general rate including the utilities rate be adopted as proposed in the council’s draft annual plan. So that was the first thing. It proposed that that general rate be adopted. Secondly there was this Motueka business rate which the council voted to be approved for that particular financial year. There was the Richmond business rate which it wished and in fact voted to be increased in that particular year and the council also voted to adopt a community facilities rate. So there you have just four actions in that particular year: to adopt a general rate to approve the Motueka business rate to increase the Richmond business rate and to adopt a community facilities rate. And I am sure the council meant well. I am sure there was some consultation about that. I am sure there was much debate in the council chambers before it voted.Unfortunately the funding impact statement provided that rates be paid by instalments. It set out the penalties and it set out all those rates that the council had proposed. However the resolutions did not in fact comply with section 23 of the Local Government (Rating) Act 2002 because the council failed in several ways. First of all the council failed to state clearly that it was setting rates as required by that section. So the vote on the floor should have relayed the setting of those rates as associated with that section under the Act. Secondly it failed to refer to all of the rates that were purported to be set when the resolutions referred only to the adoption of some of the rates. So it referred to a few of the rates not all of them. It should have individually set out each of the rates that it wished to be set for that financial year.The council did not comply with section 23 of the Act by purporting to set the rates before the council had resolved to adopt the annual plan. It should have adopted the annual plan and then set the rates so there was an issue of order. The council failed to state the financial year to which the rates applied—a simple thing we might think in hindsight. It did not actually state in its resolution as to which year these rates would apply. It failed to say that the rates could be paid by instalments. Lastly it failed to resolve to authorise that penalties be added to the rates if they were not paid by a due date. So I think those are quite simple things that the council overlooked to do—say what year the rates related to say that they could be paid in instalments and actually say that in fact there were penalties that could be added to the rates if they remained unpaid.So there we have it. Many years after the 2003-04 financial year we are now reluctantly having to pass legislation because of the oversight of that council at that time. Of course those oversights ran into the 2004-05 financial year the 2005-06 financial year the 2006-07 financial year the 2007-08 financial year and lastly the 2008-09 financial year which we are dealing with this evening. As I say I will not go forward and explain in detail the errors made in those subsequent financial years. Members can be assured that I know what they are and that I know here and here what they are. I encourage members to read for themselves the preamble in the legislation to get a good understanding and grasp of what those errors were.What I can say is that National is comfortable with passing this legislation to validate in law what should already be lawful had it been done properly and had due process been undertaken properly in the council chambers when those motions were debated voted for and passed. We are going to pass this legislation through the House. It is our intention in National to make lawful what should have been lawful. We do it reluctantly because it is retrospective legislation. We understand there are still aggrieved ratepayers in the Tasman District. We know that Damien O’Connor in a sense was reluctant also to bring this bill to the House but we feel that it is the right thing to do.I do support this preamble. I challenge other speakers to perhaps go through the 2004-05 year and explain to members and to colleagues the errors that were made there. Perhaps Damien O’Connor could do that off the cuff for the 2005-06 2006-07 2007-08 and 2008-09 years. I will leave him to make that choice. I have highlighted the difficulties. I have highlighted what are quite difficult errors to make. Those things should simply have been passed by resolution. They were not. That is why we are here today.EUGENIE SAGE (Green):I commend Mr Heatley for his detailed reading of the preamble of the Tasman District Council (Validation and Recovery of Certain Rates) Bill. There are eight and half pages that set out the errors that the Tasman District Council made in its rating resolutions in relation to the urban drainage areas in Tata Beach and Ligar Bay. I will not go through any more of them because I think we would be here all night. The Green Party is supporting this bill which the Hon Damien O’Connor has reluctantly brought to the House as retrospective legislation because stormwater infrastructure is important. The council was trying to ensure that those growing settlements in Ligar Bay and Tata Beach had an adequate stormwater infrastructure. It made a number of mistakes which are itemised in some detail in the preamble in failing to ensure that the rating resolutions were separate from the annual plan and in failing to include a map of the area that the rates would apply to. It was the detective work of Mr Schmuke and other residents of those communities who brought this to the council’s attention.As the Hon Damien O’Connor said the council really failed “Rating 101” in terms of the stormwater infrastructure and the rates but there was a very concerning and quite dismissive attitude by the former chief executive officer of the council whom Maryan Street quoted in her second reading speech that it was cheaper to come to Parliament to get these errors fixed than it was to be involved in legal action. I think subsequently the council has realised—with a number of trips to appear in front of the Local Government and Environment Committee a lot of meetings with the affected ratepayers and the time that this House has had to spend on the legislation—that this is not a cheaper way of doing things. Certainly the council has promised that it will improve and it has improved its processes so that it will not be guilty of making errors in the form and content of rating resolutions again and will ensure that they are in the correct form.Stormwater infrastructure is essential for healthy communities and the stormwater club approach that the council operates in all 16 communities in the Tasman District where it spreads the cost of providing and maintaining this infrastructure over everyone and rates against the capital value of properties is a fair system so it is really unfortunate that the council made these errors in the way the rates were levied or resolved. We certainly agree with the National member for Waitaki Jacqui Dean that we do not want to see many more bills like this one because they are retrospective. But we disagree with her claims that the Government’s changes to the Local Government Act will improve the way councils operate and enhance their decision-making capability because the Local Government and Environment Committee which considered this bill is also considering the Local Government Act 2002 Amendment Bill (No 3) and that legislation will make councils much less democratic and much more reliant on rates to fund community infrastructure as well as three waters infrastructure which this bill largely deals with and it will reduce the opportunities for public participation which tends to then alienate ratepayers from their councils. It was only last week that we had quite a prominent National Party supporter and former Christchurch councillor Margaret Murray telling the select committee that the Government’s changes were tearing the very heart out of local government for no good reason.This bill is something that the Green Party supports—reluctantly like everyone else—but the changes to the local government legislation are anti-democratic in rolling out the Auckland super-city model of a big unitary council with local boards with quite limited powers. So we support this bill but we will certainly be strongly opposing the major changes to the Local Government Act unless the select committee is able to recommend changes there. Thank you.ANDREW WILLIAMS (NZ First):I take a call on the Tasman District Council (Validation and Recovery of Certain Rates) Bill. For those of you who suffer from insomnia which I do at times I recommend that you get a copy of the Hansard of Phil Heatley’s speech and take it. I am certainly going to take it home tonight. [Interruption] No it was an interesting speech but I say to the Hon Phil Heatley my goodness it was full of all sorts of facts and information that probably we did not need. At the end of the day this council made a simple—Hon Phil Heatley: That just hurts.ANDREW WILLIAMS: —mistake Phil. It made a simple mistake. It omitted basically to include a map with the information that was sent out with its annual plan. That map would have had it been included designated where these particular rates were going to apply. Therefore the people in this particular area of Tata Beach and Ligar Bay were not fully aware that it applied to them. As a result this all blew up.The mayor of Tasman District Council Richard Kempthorne sent a letter on 27 August to the Hon Damien O’Connor who is sponsoring this bill—and congratulations to that member of Parliament on bringing this through. The mayor summarised it very well. He said that the council “fully acknowledges that we made an error in setting the 2006-7 rate for the Tata Beach and Ligar Bay stormwater urban drainage area. We regret that the error was made.” He went on to say: “We also note that if we had included the required map the rate would have been lawfully made and the rates would have payable. Therefore passing the bill in its current form would validate a rate that would have been made lawfully if the map had been included.” He said: “We are not asking to validate something that council could not have done lawfully if we hadn’t made that mistake. The extent of and amounts of the rate was clear in the 2006 long-term community plan (LTCCP). When we discovered the error we undertook a review of the inclusion of Tata Beach in the stormwater urban drainage areas (UDA) and consulted the ratepayers in Tata Beach on the options of being included in or excluded from the stormwater UDA. More people preferred the option of staying in the UDA otherwise the status quo than any of the other options.”He said: We’ve explained to you”—this was to the MPs and to the select committee—“that Tata Beach and Ligar Bay ratepayers receive a service from the stormwater infrastructure provided in their communities and they pay for this through our club approach. In our view not only is there no legislative power to remit the rates but it would also be not equitable to remit the rates to the Tata Beach and Ligar Bay ratepayers. A reason for this is that it would mean other ratepayers in the district would then have to pay for stormwater services including those in Tata Beach and Ligar Bay while the ratepayers in Tata Beach and Ligar Bay do no pay for any.There is a heavy demand for stormwater infrastructure across the district following recent flooding events. This is particularly prevalent in Ligar Bay following the devastating flood flow in December 2011. In the end council came to the clear view that remitting rates over 1 or more years with these ratepayers was not a lawful or practical solution.”So in terms of that the Local Government and Environment Committee had no alternative but to accept this information and acknowledge the fact that if there was going to be any form of remittance of rates it would have been a burden on the rest of the ratepayers in the Tasman district which would have been unfair. Secondly if you then have to go and try to find ratepayers over a period of several years—and properties change ownership; they change in terms of their titles and all that sort of thing—it would be a nightmare trying to refund rates or return rates or pay out rates to whoever owned the properties at the time and all that sort of thing. It becomes a nightmare simply because of the fact that a map was not included. It was an administrative error.Mistakes happen. Mistakes happen in central government and mistakes happen in local government. This is a very minor mistake a very small one. Again as some other speakers have said we would hope that this National Government does not again use this as an example of local government in terms of wanting to try to highlight inadequacies in local government when in actual fact like any organisation there will always be human error. This was a case of human error and we would hope that we do not for the next 6 months while we are going through the Local Government Act 2002 Amendment Bill (No 3) hear these sorts of excuses as justification for the National Party and the National Government kneecapping and undermining local government in this country.We have two tiers of government. We have central government and we have local government. We do not have three like they have in Australia or the United States or many other countries; we have only two. Our local government is very much the grassroots delivery agent for what the Government needs to roll out around this country. If this Government continues to undermine local government as it is doing in the latest local government amendment bill then all we will see is simply a breakdown of much of the infrastructure of New Zealand and the support infrastructure of New Zealand which is so vital to making New Zealand a success.In terms of the Local Government Act 2002 Amendment Bill (No 3) which is very much in line with what we are seeing in this situation we have to support local government to do its very best because at the end of the day there is $100 billion of assets out there in local government and the assets in the Tasman district are just part of that. They are vital to ensuring the future success of this country and we cannot have central government undermining the efficient delivery of service by local government throughout New Zealand.We are hearing more and more feedback from around the provinces around the rural areas—and these are in National Party electorates—that mayors who you would think were National Party mayors are saying enough is enough. They are getting tired of the National Party and the National Government undermining the good work that local authorities are doing throughout the country. I think it is time the National Government looked at itself seriously and asked whether it wants to bring local government to its knees and whether it wants to end up in a situation where New Zealand communities are broken up where communities of interest are destroyed and where it is all about the dollar and about making money out of local government rather than making good communities and good communities of interest.It seems to be that at the present time this National Government is wanting to drive down the council-controlled organisations route to have decisions made behind closed doors to have decisions made by unelected people and to have decisions made that are in the interests of its mates big business and people with interests in commercialising local government rather than ensuring that local government is there to deliver on behalf of the people.So New Zealand First supports this bill for the Tasman District Council. This is a very very minor blip in terms of the significant work the Tasman District Council does. It is in an area that has suffered significant storms and significant flooding. There have been all sorts of significant events in the Tasman district in the last decade and this is a very minor aberration in terms of the council’s overall work. We commend the Tasman District Council for its ongoing good work and we support this bill.NICKY WAGNER (National—Christchurch Central):As we have heard in the Committee tonight the Tasman District Council (Validation and Recovery of Certain Rates) Bill is about validating the Tasman District Council rates from the period of 2003-04 through to 2008-09. That is when the council just did not follow correct procedure in setting its rates. It also validates the rates and the penalties paid during those periods. Then—perhaps most controversial of all—it ratifies the Tata Beach and Ligar Bay stormwater rate. As you have also heard in the Committee tonight Parliament and parliamentarians do not like validation bills. We would much rather that councils got it right that they used correct procedures the first time. But every now and then just as the member Andrew Williams has spoken about a bit of logic and a bit of common sense demand that we pass a validation bill. These bills always come to the Local Government and Environment Committee and we work really hard to get a good result for ratepayers.The test we apply when we are looking at these breaches is whether the rates would have been valid if the processes were followed correctly. In other words is this a technical breach? Maybe the council used the wrong words maybe it did not consult properly maybe it left out a map or maybe there was incorrect timing. Is this a technical breach rather than something that could not have been valid even if the council had done everything right? In this case these rates could all have been levied correctly. The errors were technical and hence the Local Government and Environment Committee—because this test was passed—supported the bill.But the committee was very sympathetic to the arguments from the ratepayers in the Tata Beach and Ligar Bay drainage area. There had been debate around what rating category was correct for the area and why the stormwater levies were necessary when some of the houses along the beach were sitting on free-draining sandy soils and did not get affected by the severe flooding. There was also debate about where the levy money would be spent and the quality of previously installed drainage work. This had been a long and bitter debate between local ratepayers and the council and so the committee did encourage them to try to find a negotiated solution outside the bill. We wanted them to see whether they could sort this out at a local level. In fact we had two attempts to get some agreement between the parties but we were unsuccessful. We considered deleting the relevant clause which was clause 9 but that was outside the scope of this bill. So the committee decided that the time the efforts and the cost to the council—and so in turn those are the costs to the ratepayers of the Tasman District Council—far outweighed the benefits to a small number of ratepayers.The philosophy we used when thinking about this was the fact that we all live in communities. We all pay our rates for a suite of services from local government. Individuals and neighbourhoods use more or less of those services but by sticking together we get the best outcome for everyone. So although some of those properties of those ratepayers in the Tata Beach and Ligar Bay area are less prone to flooding and were not flooded during the last flooding event the roads that led to that area and that they drive on the community facilities that they use and their neighbour’s properties still need to be protected from stormwater and everyone needs to contribute to the community’s solution.We also note that this bill has required a large amount of work effort and expense for the Tasman District Council. We hope—and we have heard from it—that it has improved its processes and that it will be able to manage its rating decisions more efficiently. We do expect it to lift its game because we hope that it will never again require further legislation in this House. Therefore despite our dislike of validation legislation the Local Government and Environment Committee—after much thought much debate—supports this legislation. Thank you.Hon DAMIEN O’CONNOR (Labour—West Coast - Tasman):I will just take the opportunity to perhaps summarise a few things. I appreciate the help of the Local Government and Environment Committee members and those who have spoken before to outline—some of them in much detail—what is in this legislation the Tasman District Council (Validation and Recovery of Certain Rates) Bill. I would like to acknowledge Nicky Wagner and all the members of the committee who were so cooperative. They really did try to do their best for the ratepayers of the Tasman district.I hope that each and every councillor is actually listening to this debate. It may seem long and difficult but they should learn from it. We do not like retrospective legislation and I have to acknowledge that the House has committed quite an amount of time to sort out a problem that was basically developed because the Tasman District Council made basic mistakes—both by the staff and in the oversight by the councillors. I would just like to say that in the preamble to the bill here the wording is pretty much perfect except for one word that I would like to change. It does say here in recital 37 of the preamble that it is “desirable” that the irregularities relating to all the rates be fixed—no actually it is necessary. I do not think it is desirable that the Committee should have to commit to fix this.I think we would be sending a message quite clearly to the councillors at the Tasman District Council and to the staff in particular that they pay attention to detail. I would like to send a clearer message to some of the staff that in their dealings with the ratepayers who are ultimately the people who carry the cost of these mistakes they should be more cooperative. From time to time I hear stories where forms that might not have the right signature or something are rejected and sent back and not in a helpful way but in a rather hindering way. In the spirit of the passage of this legislation I hope that the staff at every level of the Tasman District Council acknowledge that mistakes can be made and that they are there to help people not to hinder them.I will just go through a couple of other things. The Tata Beach situation has been mentioned of course. The maps were mentioned. Yes it is true that that particular incident was incorrect and that the determination and the tenacity of Bob Schmuke and a few of those ratepayers saw them take that issue that they claim was incorrect to the Tasman District Council which rejected them out of hand in a rather arrogant fashion. They then took that through to the Ombudsman who ruled in their favour. In looking at this case the Ombudsman then found fault in other areas of rate setting. Again there is a lesson for councils. Sometimes the ratepayers—although they might seem a little obnoxious and they might seem difficult and persistent—are right. In the spirit of democracy we have to respect those people who put time and effort into trying to keep democracy open transparent and accountable.In summary I will just once again thank the Local Government and Environment Committee. There is a message here. The staff and the councillors of the Tasman District Council have to show a little more attention to detail around things like as I have said speed limits around schools where they again have an attitude that in my view may not be correct. There are community facilities that they are not supporting because of various issues. They have got water management they have got support for information centres and they have got internal processes that are sometimes not helpful. What I am saying is that the consideration of Parliament and the passage of this legislation—and I thank members for their support for me and the bill—should be acknowledged by consideration right through every area of the Tasman District Council for their ratepayers and that should flow on to the rest of the country for people who pay hard-earned dollars to support infrastructure to support their communities and sometimes to invest in areas where councils may have some unease about that. So on this particular first part in the preamble I guess that I have summarised some of the points that I would like to make.MAGGIE BARRY (National—North Shore):I rise to speak about the Tasman District Council (Validation and Recovery of Certain Rates) Bill. This is of course a piece of legislation that should never have happened. Other speakers before me have alluded to the fact that it is a series of mistakes incompetence and silliness and that is generally a darn good reason why these local government reforms that we are putting through ought to be put through in extreme haste. What we had here was a council that was in the words of the sponsoring member of the bill Damien O’Connor arrogant and it was not treating its ratepayers well. I commend also Bob Schmuke for his tenacity. I think that he is an individual who decided he would make this something that he would not let go of and I commend his tenacity and the rigour that he brought to this particular case. Had he not persevered—as Damien O’Connor said—taking it through to the Ombudsman and really persisting when he was given the cold shoulder and every discouragement possible then we would not be here today.On some levels of course we regret being here today because we have lived through the Kaipara District Council (Validation of Rates and Other Matters) Bill and it is a bit like the Jaws movie is it not—just when you thought it was safe to come back into the Chamber another validation bill comes its way. I guess none of us want that. As other members have pointed out not only has the council’s and ratepayers’ money and everybody’s time been wasted over a long period of years but now taxpayers are also bearing the burden of this having to come to the House of the waste of the House’s time and of the waste of effort that all the advisers and everyone else—let alone the sponsoring member—have had to put into this.I have to say that it is a little ironic when we hear the “Winston First Party” member Andrew Williams who has a former association with the North Shore trying to teach us—Denis O’Rourke: I raise a point of order Mr Chairperson. I object to the term “Winston First”. That is not the correct name of the member.The CHAIRPERSON (Lindsay Tisch): Members must refer to honourable members of this House by their correct name. So in future that will be abided by.MAGGIE BARRY: As I was saying for someone like Andrew Williams who failed so spectacularly on the North Shore to attempt to give us lessons—for the North Shore’s most famous irrigator to dare to try to hand down a few lessons from or hand up a few lessons—Scott Simpson: What was he called?MAGGIE BARRY: North Shore’s most famous irrigator. Surely you have heard the stories. Everybody on the North Shore has an Andrew Williams story and most of them could not be repeated here in the Chamber. I would not waste the Committee’s time going through them yet again. They have been well-tracked through. It is interesting to see that he talks about his insomnia. I think his treatments for it were the traditional ones which had then enlivened his late-night texting and caused him the sort of infamy that even he will never live down. But it is ridiculous to—Tim Macindoe: Probably just lemons.MAGGIE BARRY: Lemonade—well whatever it was—who knows? You do not want to go to into those dark thoughts of what he might have had. I guess that—Tim Macindoe: Aiding the lemon.MAGGIE BARRY: Aiding the lemon. Yes he would have had something to go with the lemons—you are quite right. There is some very helpful advice coming through.When Andrew Williams talks about people making mistakes at the local government level he is after all the expert in that matter because you know mistakes he has made a few and they continue to haunt him to this day. So there are layers and layers of irony that such a failed individual who has so conspicuously not delivered in his own area—the lowest-polling candidate and the guy who never made it back as mayor—did not even get back on one of the local boards. This is the kind of individual whom we will not be taking notice of and we will certainly not be following any advice that he gives. In fact I am surprised that we did not have a “North Shore Council Validation Bill”—from mistakes that that man would have made when he was the mayor. [Interruption] No no. That has all been abolished now partly because of people like himself.As I have said the local government reforms that this Government is putting through at the moment are of course absolutely essential when we look at what has happened with Kaipara and with the Tasman District Council. I think that when you do look at incompetence and slack councils the ratepayers are in a position where they really do need central government to step in and lead the way. It is disappointing—very disappointing—that it has to happen but this is a Government that does not shirk from its responsibilities. We will absolutely ensure that the legislation goes through with due consultation and through due process unlike what happened with the Tasman District Council.I look at some of the submissions that we had—Lindsay McKenzie the chief executive came to us. This was the council that was actually part of the problem. Perhaps the sponsoring member might like to clarify this point for us but in terms of the people who were in positions of responsibility when this mistake with the map was made it would be interesting to know just how many of them were still involved or did the ratepayers get their way ultimately and do what all people need to do when they do not like people in public office and vote them out? We have seen that of course with Labour which had I think its lowest polling ever. Would it have been in the last elections or was that in 2008? Anyway voters whether they are paying their rates or paying their taxes are absolutely within their rights to exercise their democratic right to vote people out. So I am assuming that most of the people who caused the problems at the Tasman District Council were thrown out on their ears.The background of this bill is indeed interesting. I think when you look at the options that the council left itself there were not too many. Three in fact were outlined to us by the chief executive of the now Tasman District Council. An Order in Council was one of the things that the council could have been given according to its legal advice. A replacement rate was the other option. Then there was a local bill and that is when Damien O’Connor took up the challenge of putting this bill through. The council had no choice. It had boxed itself into a corner and that is why the bill is here today.I think the other standout submission for me was from the office of the Mayor of the Tasman district Richard Kempthorne. He wrote us a submission of course and then he came and saw us as well and talked about the fact that the council did admit and acknowledge that it had made an error in setting those 2006-07 rates for the Tata Beach - Ligar Bay stormwater urban drainage area. The council regretted that that error was made and it fessed up to it but it also noted—and I think this is an important point—that if it had included that map the rate would have been lawfully made and the rates would have been payable. Therefore passing the bill in its current form would validate a rate that would have been made lawful if the map had been included. It was not asking the select committee to validate something the council could not have done lawfully if it had not made the mistake. So when we look at the facts of the matter as they were outlined and as admitted by the mayor the facts were very clear and very straightforward. The enduring miracle—Andrew Williams: Nice compliment to repeat.MAGGIE BARRY: —apart from the fact that the person who is trying to interject at the moment was ever elected mayor let alone thrown out on his ear after one term. Apart from that miracle of silliness from the ratepayers—a momentary aberration—the fact that this council did actually get up and admit that it had done wrong and admitted and supported what Damien O’Connor has done is ultimately a commendable thing.I think when we look at this bill it is pretty straightforward. There are a number of things that need to be learnt. And I must say when the Local Government and Environment Committee was presented with some of those laminated photographs of the beach area and we looked at the Ligar Bay area in particular we could see that it was a pretty straightforward sort of solution. Ultimately I guess there are silver linings to this particular cloud and one of them is that basically this will not happen again—certainly not in this neck of the woods in Tasman and hopefully not in Kaipara either. I think that once we look at what we can do as a Government to continue on with local government reforms we can ensure that ratepayers are protected from the sorts of silliness that we have seen in both of these places around New Zealand that have resulted in members’ bills which are expensive time-consuming and ultimately things that we would rather not have to go through. But we are here.There was unanimity across the select committee.Scott Simpson: The price of democracy.MAGGIE BARRY: It is the price of democracy and it is what we need to do really to ensure—as Alan Martin used to say—that it is the putting right that counts. And that is what is happening so I commend Damien O’Connor for putting this bill through.I would be very interested in the sponsoring member’s response to the question I put to him about how many of the councillors remain and whether there is still a residue of bitterness and anger in that community or whether by putting this validation through it will put things right for a community that has suffered. For someone like Bob Schmuke I hope that the slurs on his reputation the put-downs and the arrogance that he had to endure have been worth it. I have not heard back from Mr Schmuke at all but I did commend him on his tenacity at the time and welcomed that he had come through to us and I hope that Mr O’Conner will pass that on.We do need more Mr Schmukes. We could have used them on the North Shore a few years ago but we have come right now and it is all working terrifically well. I think that they are very well represented by Jonathan Coleman on one side at Northcote. Once again a Labour seat briefly but people saw the light and Jonathan Coleman was then introduced.I will have to leave it there—all choked up. Thank you very much.CLAUDETTE HAUITI (National):Kia ora Mr Chairperson. I stand to take a call on the Tasman District Council (Validation and Recovery of Certain Rates) Bill. Like my colleagues here I would like to reiterate that the bill will validate rates set by the Tasman District Council for the period from 2003-04 to 2008-09. I think that it is really important to reiterate that because it is just for that one period of time. As we heard this is retrospective legislation. The member Damien O’Connor brought it here. He was supportive of the legislation but not overly enthusiastic and I think that we have got a sense of that here from the debate this evening.The council did not follow correct process in setting the rates and we have also heard that this was a mistake. However we would hope that being retrospective it will not happen again. Therefore we are going to ensure that with this legislation going forward these kinds of things will be put in place. In respect of the local councils National’s Better Local Government reforms will help make local government more efficient responsive and well focused which is another reason why we have given support to this bill and it deserves to be given its due diligence. Better Local Government reforms include a work stream to monitor and improve council performance to help prevent future procedural errors. Again this is not the only council where this has happened so we are hoping that the council going forward will ensure that these types of mistakes do not occur again.This bill will highlight to other councils as I have said the importance of proper scrutiny when setting rates. For the sake of consistency a technical amendment will be made to clauses 5(a) 6 and 9 to replace the words “declared to have been” with “declared to be and to always have been”. The Local Government and Environment Committee was sympathetic to proposals to delete clause 9 but found that this course of action would be outside the scope of the bill. As such the committee recommended only the technical amendments discussed in its report. Clause 9 seeks to validate targeted rates set by the council for the 2006-07 financial year for the purposes of stormwater works in the Ligar Bay and Tata Beach urban drainage areas.The committee noted that there would be many practical implications of deleting clause 9. That time has passed since the rates were set compounds this issue. Without validation the council would be required to determine which ratepayers had paid their rates in 2006-07 and the amounts that they had paid; to ascertain whether the current ratepayers were the same ratepayers as those in 2006-07—and I think some of my colleagues have already talked about that too—to apportion rates if there are or were multiple owners; and to write to each ratepayer advising them of the amount of their refund and requesting bank details for those repayments. The merits of setting the stormwater rate were found to be outside the scope of this bill as well.In 2003-04 and in 2008-09 the council passed rates attached to the annual plan rather than ratifying each rate individually and it set rates before the council had adopted the annual plan. This was in breach of the Local Government (Rating) Act 2002. That Act provides avenues for councils to amend incorrectly set rates but the window of time has now passed. So this bill is needed in order to validate certain rates set incorrectly during that period and without validation the council remains vulnerable to legal challenge from ratepayers over incorrectly set rates. Validation is also required to allow the council to recover unpaid rates and penalties and I think again that my colleagues across the Committee have already talked about that.Some residents objected to details of the stormwater rate and they said that they were not properly consulted on the urban drainage area—that was a really big concern for the select committee—and that they were being charged for stormwater services that they were not using. The committee has noted that aspects of the council’s consultation were not ideal but steps have been taken by the council to improve the way the rates are set so that similar errors are not made in the future. A key part of National’s Better Local Government reforms is monitoring and improving council performance. Publicity about the bill will show other councils that their own processes may come under greater scrutiny.I just want to reflect on the whakapapa of that area and to put it into some kind of context historically in terms of its whakapapa. In respect of Tata Beach that is also part of an area next to Pōhara. The area of Golden Bay that we know now as Golden Bay was identified as the area where first Pākehā-Māori contact was had by crew members of the ship of the Dutch explorer Abel Tasman. Unfortunately for those crew members the local Māori there killed them. So I think that was just something that was very much an aside so that there might be some kind of historical context regarding Pōhara in that area. I commend the bill to the Committee.Preamble agreed to.Part 1 Preliminary provisionsJACQUI DEAN (National—Waitaki):Having had a pretty good go at the preamble of the Tasman District Council (Validation and Recovery of Certain Rates) Bill—Maggie Barry: Oh only getting started.JACQUI DEAN: Well we are only getting started because the preamble has a good deal of the description of the bill but really this bill comes right back to council processes and decision-making processes within the council. I think that the Committee understands what has happened here that brings this bill to the House which is that back in 2003-04 rates were incorrectly set and now need to be put right because if they are not put right then in fact those rates would be deemed to be unlawful and the council would be open to challenge.I just want to take a moment to reflect on the decision-making responsibilities of any local authority in New Zealand and on how important it is that those requirements under the Local Government Act and the Local Government (Rating) Act are adhered to closely and carefully because if they are not then you are going to end up in the kind of state that the Tasman District Council and others—mercifully few—have found themselves in. So it is really incumbent on the chief executive of the local authority to make sure that the calculations and the information put in front of elected members are correct so that when members do go to vote on the rating declaration there are the maps attached that describe the rating boundaries for the purpose of targeted rates and that sort of thing.So although I am absolutely sure that the elected members of the Tasman District Council have taken quite a bit of heat over this how much liability do you place on them? You know as an elected member—and I was an elected local authority member—I ask how much is it your responsibility for making sure that the resolutions that are placed in front of you for voting on are correct and how much of that lies with the council officers. Well I have a view on that. I reckon that although councillors need to make good robust decisions they have got to be made based on good evidence and good information and clearly in this case those councillors made a decision a number of years ago that was not based on good information and good evidence.I think that that is exactly what underpins the purpose of the Better Local Government reforms brought in by this Government. This kind of example just absolutely underlines exactly why we need local authorities that are capable that are proficient and that are focused on what matters. Around rates-setting time what matters is putting good information in front of the elected members so that they can have a good debate about what they are about to vote on because the voting that takes place in every local authority has an impact on rates and is taking money out of ratepayers’ pockets to provide them with services.Part 1 of this bill which is the preliminary provisions describes in detail the purpose of this bill which is to “validate specified rates set and assessed by the Council and the penalties added to those rates;” and it is the penalties where things get quite tricky for the—Chris Hipkins: This is possibly the most boring speech I’ve ever heard.JACQUI DEAN: You see the member over the other side of the Chamber has just said that this is possibly the most boring speech he has ever heard in this Chamber and I think that that is really unfortunate because this matter is quite important to the people of Tasman District. I think that those ratepayers of the Tasman District—which electorate is it? Which electorate is the Tasman District in? It is in West Coast - Tasman and maybe a little bit of Nelson. So let those ratepayers listen to what just happened from the members of the Labour caucus. They are finding this debate which is about providing good governance on behalf of their local authority boring. So I do hope that those people who are listening and watching this on television clearly understand that if they are looking for any sympathy from the Labour caucus for local government then they need not look to Labour. Clearly the member from the other side of the Chamber who has no knowledge about local government and clearly no love for local government has just absolutely displayed to everyone here that those members have no sympathy they have no empathy and they have no liking for local government.I think that that is a shame because local government underpins our communities and the provision and the setting of rates if done correctly is absolutely critical for every single community. It does not matter whether it is Wellington or the West Coast - Tasman—it does not matter where it is. It does not matter how boring that little process is that the councillors have to sit down and make the resolutions on just as we do sometimes. It is about as dry as a chip occasionally. It does not matter how dry and boring it might seem to those Labour members; actually it matters. It matters to those ratepayers because it is their money that is being taken out of their pockets by their council to pay for services that they need.I reckon that Labour has just laid its intentions bare. Those members do not care. They think it is boring. Well I tell you what: the National Government does not think that it is boring. Through our Better Local Government reforms we are putting a huge amount of focus on providing good services in local government. You see over on this side of the Chamber we want to provide—it might be boring and it might be as dry as a chip—Maggie Barry: That’s democracy.JACQUI DEAN: —good service and as Maggie Barry says that is democracy. Sometimes it is a little bit dry and not that exciting sitting down and reading lots and lots of papers and I can understand why the Labour members would not like that—The CHAIRPERSON (Lindsay Tisch): Order! Now I would actually like to hear something about Part 1. We are actually on the parts of the bill now and the parts are quite limited. I am asking the member to talk about Part 1 of this bill.JACQUI DEAN: Thank you so much Mr Chairperson because this comes right back to the purpose of this bill which is to correct the deficiency with the Tasman District Council. I think it would be fair to say that correcting mistakes made in the past is exactly what this Government is focused on doing through its Better Local Government reforms. I acknowledge that members on the other side of the Chamber Labour members in particular find that a bit boring but I can assure the Committee that we do not.NICKY WAGNER (National—Christchurch Central):I would like to take just a short call on Part 1 of the Tasman District Council (Validation and Recovery of Certain Rates) Bill because it is a short part of the bill. We have talked about the preamble which covers most of the issues that we are dealing with. Part 1 actually outlines the purposes of the bill which to recap are to validate the specified rates and the penalties added to those rates to collect any rates or penalties that have remained unpaid and also to validate the more controversial part of this bill the Ligar Bay and Tata Beach stormwater rate for 2006 and 2007. Part 1 also lists the definitions used in the bill and they show us the large number of rates that have been set incorrectly. Yes they are technical breaches and they are procedural errors but it has required a lot of time a lot of energy and a lot of money to bring this bill to Parliament so that those rates can be validated. Yes it is a necessary process but it is wasteful of council resources and when you talk about council resources what you really are talking about are ratepayers’ resources.The member who sponsored this bill the Hon Damien O’Connor in his previous speech to the Committee made a very important point to the Tasman District Council. Local councils should be responsive to the ratepayers whom they serve. They should avoid disputes with those people whom they are set to look after. They should try to deliver what the communities want when the communities want it. This validation bill would probably never have come to the House if it were not for the dispute between the Tata Beach and Ligar Bay ratepayers and the Tasman District Council. Perhaps that could have been dealt with in a more cost-effective way if everybody had been on the same side. But this was a dispute that escalated and in actual fact everybody from that escalation—the council the Ligar Bay and Tata Beach ratepayers the ratepayers for the wider district and Parliament—were all the losers in this process.Let us hope that this council and others can view this bill as a bit of a cautionary tale. Councils should remember that it is their responsibility to provide efficient effective and affordable services to their ratepayers and so they need to treat their ratepayers with respect and work with their communities. The members of this Committee have reluctantly supported this validation bill. They are supporting it because it is a pragmatic and sensible decision and it will benefit the ratepayers of the greater Tasman district area.PAUL GOLDSMITH (National):It is my pleasure to speak on Part 1 of this Tasman District Council (Validation and Recovery of Certain Rates) Bill. The Tasman district is a wonderful part of the country. I have not spent a hang of a lot of time there being based in Auckland—Kris Faafoi: Whereabouts?PAUL GOLDSMITH: —based in Epsom—but I have had the opportunity to spend a little bit of time there and it is a wonderful part of the country.I just want to go through some of the preliminary provisions and the purposes of this bill particularly: “to—(a) validate specified rates set and assessed by the Council and the penalties added to those rates; and (b) treat all money received by the Council in payment of the specified rates or penalties added to those rates” in order to fix what was a mistake made when certain rates were incorrectly set during the 2003-04 period through to 2008-09. As you would have heard Mr Chair in previous speeches without validation the council does remain vulnerable to legal challenges from ratepayers over the incorrectly set rates. This part is focused on trying to fix that problem.Certainly my experience in Epsom as in most areas is that rates are a subject that a lot of people get very concerned about because they are not linked necessarily to an ability to pay. They are based on capital value and older people on a fixed income in particular find it very difficult to cope with that. People have a very keen interest in making sure that the rates are as low as possible but they also obviously have a very keen interest in the fact that they are set lawfully and properly. Unfortunately in this instance in the Tasman District Council under the oversight of Damien O’Connor as the local MP things did not quite go right. This bill is aimed at trying to sort that out. National wants to give affected residents the opportunity to engage and is therefore supporting the bill and we have made good progress.I just want to go through the interpretation clause because this really drills down to the meat and drink of this bill. We are talking about clause 4 “Interpretation” which states that in this bill unless otherwise required—we are coming up with a definition for the 2003 rates. Let us look at 2003. Of course that was really the start of the second term of the former Labour Government when it was basically maintaining a reasonably disciplined approach to spending but was about to start increasing Government spending which was to lead to the very significant increase in Government spending overall. I accept I am moving a bit away from this bill but it was a period I think when New Zealand was doing extremely well. We did not really make the most of that opportunity because the Government just expanded its own spending rather than leaving money in the pockets of hard-working New Zealanders in order to grow their own businesses and make jobs.If we move through to the 2004 rates which is on the next line here it means “the rates set out in the funding impact statement adopted by the Council for the 2004/2005 financial year”. Again if we look at 2004 that definitely was one of the years that the locusts consumed because New Zealand was doing very well but in Auckland in particular we saw house prices really start to rocket based on—[Interruption]The CHAIRPERSON (Lindsay Tisch): Order!PAUL GOLDSMITH: Sorry I will move back to 2004. If we go on to—[Interruption] Sorry did you want me to start again?If we go on to 2005 we will be looking at “the rates as set out in the funding impact statement adopted by the Council for the 2005/2006 financial year”. Again 2005 was when the Tasman District Council started to get into serious problems because the rating information that it laid down was incorrect.Further on if we look at the 2006 rates it means “the rates as set out in the funding impact statement adopted by the Council for the 2006/2007 financial year;”. The problem with that was it was in this particular period that the technical mistakes were made which are being fixed by clause 9 which we dealt with previously. But it was there that the technical mistakes were made and the rates were levied incorrectly and that led to this legislation really which is all about trying to get the right form of words and get it done officially so that the people of Tasman can move on and have some certainty around this area.There are no particular winners out of this legislation because nobody is happy about having to do retrospective legislation in this way. But in the end if the council is tied up in endless litigation then that costs everybody. If for some reason the people whose rates were levied incorrectly do not pay their rates that just means that everybody else in the district has to pay those rates and that is unfair to them. And so the correct thing is to ask whether if it were not for the technical mistakes that were made those rates would have been properly levied and therefore this legislation really just recreates that situation.I will just move on to 2007 and 2008. Those two years were also in error and this bill is trying to correct those problems. It is interesting that this piece of legislation interprets the term “Council” to mean the Tasman District Council. That is a reminder of specifically which council we are dealing with in this legislation. The funding impact statement has the meaning given by section 5 of the Local Government (Rating) Act. These two places are Ligar Bay and Tata Beach neither of which sadly I have ever been to. I have been to Golden Bay if that is in the same district. I think it is. But those two bays Ligar Bay and Tata Beach are the two particular areas that we are talking about and that is what this part relates to.Overall I just want to say finally that National’s Better Local Government reforms are aimed at helping make local government more efficient responsive and well focused. This legislation and this part are not what you would describe as a critical part of that overall framework but it is a bill that highlights to other councils the importance of proper scrutiny when setting rates. On that basis I think I have said enough so thank you very much.Part 1 agreed to.Part 2 Validation and recovery of certain ratesMAGGIE BARRY (National—North Shore):If you thought that Part 1 and the preamble were fascinating I am delighted to be able to take a lengthy call now analysing clauses 5 6 7 and 8 and then the exciting culmination clause 9. There were no changes recommended to those but the process of how that conclusion was arrived at is indeed fascinating. I am of course hoping that the sponsoring member Damien O’Connor will be able to shine a little light on how the community has responded to the progress of his member’s bill the Tasman District Council (Validation and Recovery of Certain Rates) Bill so far but I see he is deeply engaged in conversation. Perhaps at a later moment he might be able to sort of elucidate and come to it. I could ask him again really—now that you are paying attention—to talk about the community and how it feels about this validation and whether it will in fact smooth over some of the hurt feelings and problems that have happened.When we look at clauses 5 6 7 and 8 they are specifically concerned with the validation of the specified rates the validation of penalties the payment of specified rates that have been declared lawful and then clause 8 itself the “Recovery of unpaid specified rates or penalties declared lawful”. A number of submitters opposed clauses 6 to 8 in relation to the penalties in particular. One submitter’s view that was particularly interesting was that the council should be limited to being able to collect only the base rate but not the penalties for late payment on the base amount. This is the logic around it: the ratepayers who had delayed paying the rates because they were invalid should not be penalised. This was considered unjustified because it would mean that the council would then be benefiting from its own errors which is of course something that we need to take into account. After all as every good parent knows you cannot reward bad behaviour. By benefiting from its own errors the council would indeed be in a difficult situation. Well in fact it would be in a good situation but that would send a very bad signal to other councils.One submitter on those clauses 5 through to 7 suggested that penalties should apply only to amounts that remain unpaid after some specified period after the Act comes into force. So you will appreciate that there were a number of submitters who had given this a great deal of thought time and energy. The officials for their part also devoted a lot of time and energy to this. As I said in my earlier call on the preamble it is a shame that something like this has got to the stage that it has and that it has wasted so much of the House’s time and the taxpayers’ money. But there it is—that is the nature of democracy. We know that the Labour members’ short concentration span on the whole cannot really tolerate it but we will go through it—Jacqui Dean: They find it boring.MAGGIE BARRY: Yes they find it boring. That is a very very telling observation. I think that they seem to find most things boring which is probably why the local government reforms will go through and they will go through without too much in the way of rigorous opposition because Labour members just cannot marshal the intellectual rigour to be able to counter any of the excellent arguments that we put forward. So there you go—they are indeed wallowing in their short concentration spans and their problematic moments.I would like to go now to the recommendations of the Department of Internal Affairs on the clauses. It did consider them to be appropriate for purpose. The department recommended no changes to clauses 5 to 8. When we come to clause 9 Mr Chair—and I know you will be interested in this—it makes explicit the nub of the problem which is the 2006-07 Ligar Bay and Tata Beach stormwater rates. It made them valid and declared them lawful despite the category of rateable land not being identified in that earlier impact statement. You know floods occur occasionally in this area and that was explained to us in detail by a couple of submitters—in particular Mr Schmuke who had gone to a lot of trouble to laminate several large photographs and had as I said in my earlier call and as others have referred to just taken it that step further.Nine submitters opposed the validation of the Ligar Bay and Tata Beach stormwater rates. They were very much opposed to the initial levying of the stormwater rates on the grounds that no stormwater drainage services were provided by the council and that there was no need for them; therefore why should they pay for them? Further there was no initial consultation on the inclusion of Ligar Bay so those ratepayers felt themselves disenfranchised not involved in the process and were obviously therefore very unhappy at what they were expected to pay. Submitters also opposed the validation of the invalid stormwater rates on the basis of the Ombudsman’s opinion back in 2009 that supported the position that levying a stormwater rate for Tata Beach was based wholly or partly on the mistake of law and fact. Really was that natural justice? No it was not.So the officials had commented—Hon DAMIEN O’CONNOR (Labour—West Coast - Tasman):I thought I would just take the opportunity to answer a couple of questions I have been asked. On the one of accountability for mistakes and whether that has run far and wide I can say that there were a number of councillors who lost their positions in the last election and a number of staff have been shifted around. So I think that that has occurred and hopefully the rest of them will have had the message.On this particular part Part 2 I would just like to mention on clause 9 that it was the request of the Ligar Bay and Tata Beach residents to have it removed so that in fact they would then have to go back through a full process of consultation as to whether the rates should be struck or not. The Local Government and Environment Committee I have to acknowledge brought the parties back twice—they were at the committee twice—to try to reach a common position on this. It could not be reached. On balance the committee thought that it was essential that this Tasman District Council (Validation and Recovery of Certain Rates) Bill proceed for the good of all the ratepayers and that there should perhaps at some point be some acknowledgment of the Tata Beach and Ligar Bay residents. That is yet to be seen but hopefully is to be committed to and honoured by the Tasman District Council. I am not quite sure how that might occur but I think they probably deserve it.Clause 9 remains in the bill and it proceeds and it is up to the council now to ensure that fairness and harmony exist among as many ratepayers as possible. So once again I would just like to acknowledge the work of the select committee in giving it a fair go but arriving at what I think is a pragmatic solution.Hon PHIL HEATLEY (National—Whangarei):I would like to take the time to focus in on clauses 5 to 9 of the Tasman District Council (Validation and Recovery of Certain Rates) Bill and on the details that for many members are hidden behind these words. A once-over-lightly reading might suggest that we are making some sweeping changes here but it is important to note that clauses 5 6 and 7 in particular are a summary of what we saw in the preamble. For example in clause 5 here it talks about the “Validation of specified rates” and says that “Despite the failure of the Council to comply with section 23 or 24 of the Local Government (Rating) Act 2002—(a) the specified rates are valid …” and on it goes. Well sections 23 and 24 of the Local Government (Rating) Act in terms of what we are having to validate in terms of section 23 by way of an example the council in 2003 and 2004 as stated in recital (3) did not “state clearly that the Council was setting rates as required by that section” which occurred in 2003-04. So there was the unlawful action covered by section 23 of the Local Government (Rating) Act. It also failed “to refer to all of the rates that were purported to be set” so when the resolutions were made the council in effect did not detail all the rates to be set. It sort of cherry-picked which ones it described in detail and it should have actually resolved to set them all individually and presumably voted on each of them.Also the council did not comply with section 23 of the Act as described in recital (4) of this bill. It did not “set the rates before the Council had resolved to adopt the annual plan …” and that is an important matter. It should have adopted the annual plan and then the rates setting falls out of that adoption rather than the other way round. Recital (5) of the preamble also talks about the breaches of section 24 of the Local Government (Rating) Act and in this case section 24 was breached because the council failed to state that all the rates were purported to be set in that particular year “that the rates could be paid by instalments”—it never made that clear—and that in fact penalties could be added to the rates. It should have done that all under section 24 of the Local Government (Rating) Act 2002. So in fact when you look at recitals 5 to 7 of the preamble where it talks about those breaches of section 23 and section 24 of the Local Government (Rating) Act those are the specific breaches we are talking about. Of course that is just in the 2003 to 2004 year.So here we have a change that the Local Government and Environment Committee has recommended to these particular clauses of Part 2. For a start for the sake of consistency we are recommending a technical amendment be made to clauses 5(a) 6 and 9 to replace the term “declared to have been”—and we are talking about “declared to have been” made valid. We are saying that what we should better say for the sake of consistency is “declared to be and to always have been” and that is much more thorough all-encompassing and clear. It leaves little room for any doubt in any courtroom across New Zealand particularly in the courtrooms of the Tasman district that we are talking about validating rates. They are “declared to be and to always have been” valid. So where this works out in clause 5(a) we are saying that “the specified rates are valid and declared to be and to always have been lawfully set by the Council”.In clause 6 we are saying that “those rates are valid and declared to be and to always have been lawfully imposed by the Council.” In clause 9 we are saying that “the Tata Beach stormwater rate for the 2006/2007 financial year are valid and declared to be and to always have been lawfully set”. So there you have in clause 5(a) “always have been lawfully set by the Council”; in clause 6 “always have been lawfully imposed by the Council”; and again with Tata Beach in clause 9 “set and assessed by the Council”. So it is very very important to note that we have made that technical change. I would encourage parliaments moving forward—so for the rest of this year and I guess if most of the country feels this way hopefully with a National-led Government for the next 3 years—to include the consistency that we have included tonight. That is not to simply say “declared to have been” but to say “declared to be and to always have been”.I do want to touch a bit more deeply on clause 9 of Part 2 as well and that is the validation of Ligar Bay and Tata Beach stormwater rates. The committee was tempted—and many members of the committee are more open to temptation than others. Some of us try to lead more pure lives than others but some are tempted. We were all tempted to a degree by this issue of actually wiping clause 9 off the record books. Given the historic nature of the rating errors in question and being a very open Government and honest about what we do this would be difficult because without such validation a council would then be required to do a whole bunch of things regarding Ligar Bay and Tata Beach. It would have to determine which ratepayers had paid the rates in 2006-07 and the amounts they had paid and ascertain whether the current ratepayers are the same ratepayers as those in 2006-07. What an onerous task. It would have to apportion the rates if there were multiple owners of a residence—so if there were two owners over that time period it would have to apportion the rates presumably pro rata. If there were three owners it would have to apportion them three ways four ways and so on depending on the turnover of that property. It would have to write to each ratepayer advising them of the amount of the refund and requesting bank details for repayment.It is a difficult task tracking those people down getting their consent getting their bank account details—finding out all those details—and in the end having the permission to do so from the individual. So it is a difficult task indeed. We decided that we would in fact retain clause 9 albeit in an amended form. So that is a pragmatic solution to the issue of validation of Ligar Bay and Tata Beach stormwater rates.DENIS O’ROURKE (NZ First):I move That the question be now put.Motion agreed to.Part 2 agreed to.Clauses 1 and 2CLAUDETTE HAUITI (National):I would like to reiterate that the Tasman District Council (Validation and Recovery of Certain Rates) Bill will validate the rates set by the Tasman District Council for the period 2003-04 to 2008-09 during which time the council did not follow correct process in setting rates. The bill will also validate rates and penalties paid over that period authorise the council to recover any unpaid rates and ratify the Tata Beach and Ligar Bay stormwater rates. This bill is as we have heard this evening retrospective legislation but it is very necessary legislation in order to set the foundations for better local government going forward.This National Government is about Better Local Government reforms. It is about allowing those councils to make those very hard decisions especially under increasing pressure. However mistakes like this do occur and we are hopeful that this legislation will minimise the risk going forward and will ensure that other councils learn from this mistake. Better Local Government reforms include work streams to monitor and improve council performance. This legislation will reinforce to those councils that they will be monitored and that compliance must be met. Although those viewers at home may find that this is very technical and rather dour and boring it is absolutely necessary that we get this right for the sake of the Tasman District Council and all other councils going forward. I say again that this is retrospective legislation but it is necessary. Of course it is being supported across the Committee albeit not overly enthusiastically but again the bill has got to be given its due diligence.For the sake of consistency technical amendments will be made as we have heard this evening. The Local Government and Environment Committee was sympathetic to the proposals that were brought forward by members of the Tasman District community to delete clause 9. However it must be reinforced that the Tasman District Council (Validation and Recovery of Certain Rates) Bill is absolutely necessary for the Tasman District Council to go forward in a robust fashion. The committee noted that there would be many practical implications of deleting clause 9 which is actually quite important. It needs to be reiterated and reinforced that the time that had passed since those rates were set compounds this. Without validation of the stormwater rates the council would be required to determine which ratepayers had paid the rate in 2006-07 and the amount that they paid. I am repeating this because although this bill may seem to be technically very detailed it is absolutely crucial that clarification around these technical details is had. The merits of setting a stormwater rate were found to be outside this bill and I think that that needs to be reiterated as well given the submissions that wanted that to be done.From 2003-04 to 2008-09 the council passed rates attached to the annual plan rather than ratifying each rate individually and that is something that this council will need to do going forward. To ensure that this does not occur again the council will need to implement procedures to ensure it meets compliance with the legislation. This was in breach of the Local Government (Rating) Act 2002.The Local Government (Rating) Act provides an avenue for councils to amend incorrectly set rates but the window of time had passed. The bill as we have heard is needed to validate certain rates that were set incorrectly during that period. Without the validation the council remains vulnerable to legal challenges from ratepayers over incorrectly set rates. Validation is also required to allow the council to recover unpaid rates and penalties.Some residents have objected to details of the stormwater rate. They were not properly consulted on the urban drainage area and they are being charged for stormwater services that are not being used. The committee noted that aspects of the council’s consultation were not ideal but steps taken—PAUL GOLDSMITH (National):We are dealing with clauses 1 and 2 I believe of this bill. The title which is the Tasman District Council (Validation and Recovery of Certain Rates) Bill could I suppose just as easily be the “Tasman District Council (Recovery and Validation of Certain Rates) Bill” but I think the word “validation” probably should come first followed by the word “recovery”. If we were to have the word “recovery” before the word “validation” we would get ourselves into a terrible pickle. So I agree in essence with the title as it is laid out. It has to be the Tasman District Council because that is the council that is affected by this bill. It cannot be any other council. What puzzles me however is that the bill says “2013” because as we all know it is 2014 at the moment. But I presume that that is part of how it is operated.So we are dealing here with the Tasman District Council (Validation and Recovery of Certain Rates) Bill and that I suppose in essence is the problem that we had with the legislation—that the rates were not certain at all because they had been incorrectly rated. So this bill here is indeed attempting to validate what had been made uncertain by the poor process. If we can make those rates more certain then we can give certainty back to the people of the Tasman District who have been going through a difficult time because of this bill.The second clause relates to when the bill comes into force. Again the suggestion is that it would be the day after the date on which it receives the Royal assent. Again that makes perfect sense because you certainly would not want it to take force the day before it received the Royal assent because that would not be appropriate. It could have been considerably later at any particular given time and indeed a number of people considered various options. It could have been 1 January 2015 for example but in essence the Local Government and Environment Committee was persuaded that it did not make any sense necessarily to stick with 1 January but rather to go with the date as suggested so as to come into force exactly on the day after the date on which this bill receives its Royal assent. On that basis I think I will leave it. I just wanted to make a short call on these clauses 1 and 2. Thank you.Clause 1 agreed to.Clause 2 agreed to.Bill to be reported without amendment presently.