Gallagher Martin: Local Government (Rating Cap) Amendment Bill — First Reading 
Gallagher Martin: Local Government (Rating Cap) Amendment Bill — First Reading 
[Volume:633;Page:4811] 
MARTIN GALLAGHER (Labour—Hamilton West) 
: 
 The aim of the Local Government (Rating Cap) Amendment Bill is as I understand it to amend the Local Government (Rating) Act 2002 to limit the increase in rates revenue sought by a local authority in any year. The bill provides for a maximum rate increase in any year of the rate of consumer price inflation for the preceding year plus 2 percent. The maximum in any 3-year period is to be the rate of consumer price inflation for the preceding 3 years plus 4 percent. 
I find it somewhat surprising that the former Mayor of Wellington which is a very lovely and great city in my view—nearly as good as Hamilton—would actually support a bill whereby the central government of the day could— 
The ASSISTANT SPEAKER (H V Ross Robertson) 
: I am sorry to interrupt the honourable member but the time has come for me to leave the Chair for the dinner break. 
Sitting suspended from 6 p.m. to 7.30 p.m. 
MARTIN GALLAGHER 
: Obviously I do not support this bill but I assure the Speaker that I will not be engaging in the kind of personal attack we witnessed in the general debate by Chris Finlayson on the Minister of Revenue the Hon Peter Dunne. I thought that was the most appalling attack on a member that I have heard for some time. It was quite incredible. 
Hon Ruth Dyson 
: What was that? 
MARTIN GALLAGHER 
: That was Chris Finlayson maligning the integrity of the Hon Peter Dunne. It was quite a bizarre attack. 
I do not agree with this bill but I will not attack its author. What I will say is that I believe that this bill would take us to an era of central government control through the Minister of Local Government irrespective of who that Minister was and what that Minister’s political shade might be. It would effectively destroy local decision-making local accountability and in fact local government. The Local Government Act has a very very rigorous form of community accountability. It is called the 10-year plan and it is reviewed on an annualised basis. 
Speaking as a citizen from Hamilton I say that we have a very very good council. We have an excellent mayor Michael Redman and an excellent council team. I do not want a Minister of Local Government of whatever political colour to be dictating to people in the Waikato and in Hamilton as to what projects we can undertake and how we structure our budget. This bill would mean for example that if we needed a special rate to build the wonderful Waikato Stadium which took us above the criteria of this bill we would have to go cap in hand literally and beg the Minister of Local Government of the day for the funds to do that. That is not local democracy; that is not local accountability. 
The argument very clearly and concisely is simply this: we have two tiers of government in this country. Lest this Parliament should forget there is another tier of democratic governance in this country. We are not the only game in town so to speak—there are councils up and down the country which citizens elect and which also have a democratic mandate in their own right. 
Obviously I agree to differ with the author of this bill about how we address what is the significant issue of how we fund and finance local government. As a former deputy mayor of Hamilton and also as a member of the Local Government and Environment Committee I acknowledge that the issue of what is a fair and equitable way of funding local government is a very significant one. I commend our very good Minister of Local Government Mr Mark Burton who today announced the establishment of an independent inquiry into issues around local government rates funding. In fact the Minister has stated: “The Government will develop the inquiry’s terms of reference in consultation with other parties. The terms of reference and other details will be released in due course.” The Minister also said and I think it is a very good quote: “This is an important issue which is concerning central government local government and ratepayers. The … Government believes an independent inquiry is the best way to consider these issues. We have been working closely with New Zealand First because like us they are concerned to ensure that this issue is dealt with in an independent manner. I look forward to wide parliamentary support for this inquiry process.” Indeed the Minister stated: “The inquiry will be able to consider the work of the joint Central Government/Local Authority funding project which will report to the Central Government/Local Government Forum in October.” 
Quite frankly I pay tribute to the work that Local Government New Zealand mayors councils and chairs of regional councils are already doing in this country. This is about local democracy. We in Parliament acknowledge that we have to look at more innovative ways of funding local government. I also acknowledge the huge transfer of taxpayer funds from central government in Wellington to local government projects that is already in effect. Let me acknowledge that it is at an all-time record. I do not agree with this bill. The independent inquiry is the way to go.