King Annette: Local Government (Salary Moderation) Amendment Bill — First Reading 
Text is incorporated into the Bound Volume 
King Annette: Local Government (Salary Moderation) Amendment Bill — First Reading 
[Sitting date: 15 August 2012. Volume:682;Page:4446. Text is incorporated into the Bound Volume.] 
Hon ANNETTE KING (Labour—Rongotai) 
: 
 I move  
That the Local Government (Salary Moderation) Amendment Bill be now read a first time. 
Hon Simon Bridges 
: This is a honey of a little member. 
Hon ANNETTE KING 
: I nominate the Local Government and Environment Committee to consider the bill. Thank you to the member who has just interjected. This is a honey of a bill. In fact it is a very very exciting night for this member in the House because it is a totally new experience for me as a member of Parliament. Never in my many years—not as long as Maurice Williamson and a few others—of being in this House have I had a member’s bill drawn from the ballot. So you can imagine the excitement I felt— 
Hon Maurice Williamson 
: The ecstasy. 
Hon ANNETTE KING 
: —the ecstasy—when this bill was drawn out of the ballot. I have introduced Ministers’ bills very good ones and not so good ones. I have voted for many other people’s bills and have been very very proud to do so. But this is the first opportunity I have had to have a member’s bill in my name. You know this whole member’s bill opportunity is very very addictive because there are many many more bills to come from this side of the House. We are very excited about being able to make a difference in New Zealand by being able to introduce bills that people are keen on. Of course what we have managed to do is to shame the National Party into lodging something like 14 members’ bills over the last 2 weeks. 
But I want to start with this bill and thank the writer and author of the bill who did the work for me Charles Chauvel. He is an asset to any party in Parliament. He has the ability to write legislation for us in a very short time and he does most of the law drafting for us on this side of the House. We do not have a bevy of law drafters to do the work for us unlike Mr Auchinvole with his Habeas Corpus Amendment Bill. Of course when the Law Commission provides a report it also writes the entire bill and hands it over to the Government of the day and Mr Auchinvole was very lucky that all he had to do was pick it up and table it. Well in this case Charles Chauvel was the author of this bill. 
I want to thank my colleagues who have supported me in this bill. I want to thank the members of the Maori Party who have said they support this bill and New Zealand First members who have given me an assurance that they are supporting it. In fact they have a similar bill in the ballot and they are looking to move a Supplementary Order Paper should it get to the select committee stage and back into this House. The Green Party has also indicated support for it. I am unsure as to where the National Party sits on this bill. I am also very pleased with the community who brought this issue to politicians’ attention. 
This bill is aimed at helping local government not hindering it. It is aimed at providing an evidence-based approach to setting remuneration for chief executive officers of local government. It is aimed at providing a transparent accountability mechanism which will ensure that it is very open to the public as to what is happening when it comes to the setting of pay conditions and remuneration. And it gives the ratepayers some confidence that there has been put in place a process where an independent rigour has been applied to salaries and conditions and it is able to be compared with others in a similar situation. I also think it provides protection for elected councillors from public criticism. 
Where did it all start? Well it started in December 2011 following the devastating earthquakes in Christchurch. The Christchurch City Council through a very small committee of councillors including the mayor set the remuneration for their chief executive officer at an additional $68000 a year—an increase in salary of 14 percent that took his pay to $538529. Many councillors had no knowledge of how and why this figure was reached. It was done secretly and it was considered by many local people to be an obscene increase in the chief executive officer’s salary. Consider the conditions that people in Christchurch faced in December 2011. They were still without their homes. They had lost their jobs. They had lost family. Some of them still had no water and no sewerage. They were working long hours. Some of them had no pay and had hard work. And they had all the pressures that that community has had on them. They could see no justification for a pay increase that was 1½ times more than the average salary at that time. And it was not helped by the chief executive officer taking an overseas holiday during the earthquake spending time during work time at the golf course and then going out and adopting a very public and arrogant justification towards the pay increase that he got. For some it was the last straw. 
But Christchurch was not alone in this respect. There has been disquiet in many local government areas about the remuneration of chief executive officers and how it is set. We had the case in Kapiti of a pay increase of $44000. Although I understand there were different circumstances there was still not the transparency and openness that ratepayers have been expecting. You see different approaches taken by different councils when it comes to setting chief executive officer remuneration pay and conditions. Some have small committees that are done in private some have full councils and some pay their chief executive officers right up to the top of the market in the private sector which is what some of the complaints have been about. Others pay under that. There is no consistency. 
So what is this bill about? This bill is aimed at ensuring from a hit-and-miss affair that we have now that there is a uniform approach and transparency which are absent now. What I want you to do is to compare what happens with the public sector and how we set remuneration terms and conditions and appointments in the public sector. To begin with Cabinet does not appoint a small group of Ministers to sit around and interview chief executive officers performance review them and set remuneration. It is actually done at arm’s length because under the State Sector Act 1988 the conditions of employment of chief executive officers are determined in each case by agreement between the State Services Commissioner and the chief executive in the first instance. But the commissioner then obtains the agreement of the Prime Minister and the Minister of State Services before finalising the conditions of employment with the chief executive. The process is tried and true is based on experience and is appropriately moderated between other chief executive officers looking at what their responsibilities are the size of the job and other benchmarks. It provides the appropriate evidence as to why a chief executive has received the level of remuneration. 
Well this bill amends the Local Government Act to add a requirement that terms and conditions including remuneration of a chief executive of a local authority must be approved in advance by the State Services Commissioner. At the outset the condition of employment will be determined between the local authority and the chief executive. That can be done in whatever way the local authority decides but before it is finalised announced and decided the territorial local authority must obtain written consent of the State Services Commissioner to any such agreement or any variation of that agreement. There would then be a requirement on the State Services Commissioner to ensure that the remuneration is comparable to that in a similar job size and so on. I think it gives a very clear and transparent path using the expertise that is available in the State Services Commission and having been a Minister of State Services I understand the work that they do and the very high quality of that work in assisting a Government in setting remuneration pay and conditions. I think it would be a very good tool for local government to be able to use and when the comparisons are done by the State Services Commissioner they can then say: “We know the Rangitikei District Council is paying this amount because it is comparable to a similar job size. It is not way up above the level it ought to be. It is not set against unknown benchmarks. It is done in a proper transparent open and fair way.” I commend this bill to the House.