Woods Megan: Local Government Act 2002 Amendment Bill — First Reading 
Text is incorporated into the Bound Volume 
Woods Megan: Local Government Act 2002 Amendment Bill — First Reading 
[Sitting date: 12 June 2012. Volume:680;Page:2856. Text is incorporated into the Bound Volume.] 
Dr MEGAN WOODS (Labour—Wigram) 
: 
 I am very happy to take a call on this bill the Local Government Act 2002 Amendment Bill and to continue the case of why it is that Labour is opposing this legislation. We have got very clear reasons why we are opposing this bill that has come before the House. We are opposing it because it is a politicised attack on local government and it will undermine democratic processes and put a fiscal squeeze on councils.  
We see this as yet another attack on democracy. Not content with stealing votes in Canterbury and its machinations in Auckland this is a Government that is going after more democratic rights in this country—the raiders continue. This bill is a solution looking for a problem. It is a reform to a manufactured crisis based on manufactured statistics. We have heard members in this House tonight—we heard Nick Smith before the dinner break and we have just heard Nikki Kaye—continuing this myth-making and spinning the numbers even though their own officials do not agree with them. We have had the Department of Internal Affairs tell the National Government that this is not right. The regulatory impact statement for this bill raises the issues of the risks whether the proposals will work the significant sector reaction that is likely and the assumptions that have not been partially tested.  
The numbers that this bill is modelled on are shonky. We heard the previous member from the Government side talking about the need for greater transparency and budgeting in local government. Well I put it to members here that actually the levels of transparency that we have around budgeting in local government far outstrip the levels of transparency we have at central government. The debt-equity ratios that territorial local authorities need to work to are transparently laid out not only in long-term council community plans but also in the annual planning process. There is this level of transparency so let us not dress up what this legislation is really about. What this legislation is really about is yet another raid on New Zealanders’ democratic rights and their rights to be heard. What this legislation is also about is yet another way for this Government to try to sell assets in this country and this is the focus of the legislation that I am going to talk about tonight.  
It has not been dressed up at all by Government Ministers or indeed the Prime Minister that this is one of the primary objectives of the legislation. Provisions in this bill will enable the Government to really put the fiscal squeeze on councils to sell their assets. They are being advised by the Prime Minister and the Minister of Local Government to consider selling those assets. New Zealanders are telling this Government over and over again that they are opposed to asset sales at central government level and they are also opposed to these sales at local government level. This is not something the community wants.  
In January this year the Minister for Canterbury Earthquake Recovery Gerry Brownlee asked for a list of ratepayer-owned strategic assets in Christchurch and said there would never ever be any pressure put on Christchurch City to sell those assets. Well you do not ask for a list of something just to keep it in your back pocket and lo and behold what has happened? There is continued pressure going on for the sale of assets in Christchurch. We are seeing a mayor and a council having to do a push-back to keep hold of those assets.  
Let me tell you John Key has said that it is time for us to have a grown-up conversation about asset sales in Christchurch and Christchurch City’s holding on to that. Well let us start that grown-up conversation right here and now about Christchurch’s assets. Let me tell you a story a story of a city that withstood the ideological push over a number of years and retained its assets. It is a city that was branded—which the Business Roundtable at the time thought was going to be a put-down—as the “People’s Republic of Christchurch”. Well I can tell members opposite before you start trying to flog off our assets in Christchurch this should actually be a bit of a warning bell. That was a tag we wore with pride. We did not sell our assets; in fact we did everything we could to keep them. What does this city which managed to keep intact its asset base and this story have to teach the nation? This is a city that has an asset base of around $2.3 billion plus additionally its city housing stock of which it is the second-largest landlord in New Zealand. We have assets like our electricity supply company Orion. We have our airport our port our City Care and Red Bus—the list goes on.  
These assets these cumulative assets which have been built up by generations of Christchurch people what has the impact of retaining these assets been? The impact has been that Christchurch has rates that are on average 20 percent lower than the rest of the country. We are being told by the Government that one of the purposes of this bill is that it wants to reduce the burden of rates on residents around New Zealand. Well here is a salient lesson through the story of my city the story of Christchurch: do not flog off your assets and you get a dividend stream. That dividend stream to Christchurch is what has kept our rates low. How have we kept our rates low? Has it been by slashing and burning and not providing services to its residents? No. That has not been the way we have kept rates low; it is that dividend stream for these assets that we have jealously held on to the dividend stream of around $40 million per annum that is returned to the city. That equates to around $2 per week for the average household that they do not have to pay in rates. This is a dividend stream coming from Christchurch City Holdings Ltd of around $100 million per annum. This is even a conservative take-back to the city that allows for the building of the assets. It just beggars belief that we might want to sell these off.  
How much could these be flogged off for? Well we do not know because our council is being pressured to ready these assets for sale according to information that I have had released under the Local Government Official Information and Meetings Act. I have a list of all the assets and what they are worth and the council has been asked to put together a book value for them. That has all been blanked out so we do not actually know what the Government thinks we could have but we do know that the Government is asking the council to repeat the model its mixed-ownership model—which is a fancy way of saying “selling off the assets”—that is happening at central government level at local government level as well.  
What is the net result for Christchurch going to be if these assets are sold off as this legislation is going to put the push on to do? It will be higher rates in the long run because half—half—of that $40 million a year of dividend stream will now have to be received through the rates system. Even if Christchurch City has to endure the 7.5 percent rates increase that the council is currently proposing in its annual plan rates in Christchurch will still be 16 percent lower than the rest of the country simply because we had the foresight as a city to hold on to our assets. What we have now is a Government that says that it wants to force councils to sell their assets in an effort to keep rates low. Well the story of Christchurch shows how short-sighted that is. It shows the fact that financially in the long run all it is going to do is put rates up. It is exactly the same argument against selling State assets at central government level. This is an ideological commitment from members opposite to put on the block assets that have been built up by generations of New Zealanders that are not those members’ to sell and which they have no mandate to sell.  
This piece of legislation does nothing to enhance democratic rights in New Zealand. It does nothing to better local government. All it will do is asset-strip the people of New Zealand in yet another way.