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No change for North Rodney, Waiheke

Date: 30 Nov 2017

The Local Government Commission has determined that the status quo is the preferred option for local government reorganisation in Auckland. Lead Commissioner for the Auckland reorganisation Geoff Dangerfield said that the applications for unitary councils for North Rodney and Waiheke, lodged by the Northern Action Group and Our Waiheke respectively, would therefore not proceed and the existing local government arrangements for Auckland would remain in place.

“This decision has been taken only after careful consideration of the applications before it, and examination and analysis of the evidence tested against the criteria set out in the Local Government Act.

“We have found that neither a North Rodney Unitary Authority, nor a Waiheke Unitary Authority – combining the responsibilities of district and regional councils for their respective proposed areas – meet the statutory legislative tests,’’ Mr Dangerfield said.

“Further, there were no other alternative proposals put forward that met the tests for a change to the current local government arrangements.’’

Mr Dangerfield acknowledged the input of the associated communities to the long and prescriptive process.

“The Commissioners and the staff of the Commission would like to thank the communities of Rodney and Waiheke for their considered contributions to the process. We have taken on board comments and feedback from the applicant and other proposers, as well as the wider communities, and that has helped in our decision-making.

“We recognise that people do feel strongly about local government in their respective districts and some consider there to be significant shortcomings,’’ Mr Dangerfield said. “However, the Commission does not consider structural change as set out in the applications will best promote the purpose of local government for the respective communities.’’

The main points of the decision are as follows:

  • The applications for unitary councils for North Rodney and Waiheke will not proceed.
  • Neither would meet the statutory legislative tests. In particular, to be considered “reasonably practicable’’, the Commission must be satisfied that an option will:

○     Have sufficient resources

○    Have an area that is appropriate to its role

○    Contain distinct communities of interest; and

○    Enable catchment-based flooding and water management issues to be dealt with effectively.

  • The only two options that we could be satisfied on those four points were: the status quo and two local boards in Rodney.
  • The Commission could not be satisfied that a proposed North Rodney Unitary Authority would definitely meet those four legislative tests.
  • The North Rodney Unitary Authority would not have the resources necessary to enable it to effectively carry out its responsibilities, duties and powers. This includes consideration of the necessary capability and capacity as much as financial resources.
  • The North Rodney Unitary Authority’s small size (popn 24,000) relative to the technical scale and scope of regional functions, including those related to large sensitive marine environments, is not appropriate.
  • While there is a level of uncertainty in any modelling, the Commission’s view is that it would be likely to run at a significant deficit, even before transition costs are factored in, with a one-off rates rise in the region of 20 per cent.
  • The Commission could not be satisfied that a proposed Waiheke Unitary Authority would definitely meet those four legislative tests.
  • The Waiheke Unitary Authority would also not have the resources necessary to enable it to effectively carry out its responsibilities, duties and powers. This includes consideration of the necessary capability and capacity as much as financial resources.
  • The Waiheke Unitary Authority’s small size (popn 9000) relative to the technical scale and scope of regional functions, including those related to large sensitive marine environments, is not appropriate. 
  • While there is a level of uncertainty in any modelling, the Commission’s view is that it would be likely to run at a significant deficit, even before transition costs are factored in, with a one-off rates rise in the region of 8 per cent.
  • While smaller councils are likely to have lower unit costs for some functions, such as general corporate overheads, there are some areas where they could face significant diseconomies of scale, such as on many of the environmental regulation and management responsibilities of a unitary authority.
  • The Commission ruled out a second local board for the Rodney area as the preferred option mainly on the grounds that it would incur additional expense for the Auckland community in return for uncertain potential gains.
  • This decision has been taken after careful examination and analysis of the evidence, as required under the Local Government Act.
  • That consideration included the applications put forward by the parties, technical and financial analysis by independent experts, communities of interest studies, community engagement, and additional research [expert panels etc], which will be released at 3.30 today (30 November).
  • The Commission thanks the Rodney and Waiheke communities and alternative proposers for their input into the process and acknowledges the sincere and committed work of the applicants, alternative applicants and other groups interested in the process.
  • The full decision is available at www.lgc.govt.nz

Questions and answers

Q. What happens now?

A. This is the end of the Auckland reorganisation process. The current local government arrangements remain in place.

Q. Can further Auckland reorganisation applications be lodged?

A. The legislation does not prevent this but the Commission has some discretion in deciding whether to assess an application, including if the proposed changes are substantially similar to those of an application already considered by the Commission and not found to be a reasonably practicable option.

Q. The initial application was lodged in November 2013. Why did this process take so long?

A. The local government reorganisation process is set out in legislation. It is prescriptive and rigorous, and needs to be underpinned by thorough research and carefully considered decisions at each stage of the process. This takes time. (A brief history of the application is set out below.)

Q. Is cost the most important factor in the Commission’s decision?

A. Obviously it is important in that it impacts on an authority’s ability to fulfil its functions, but the most critical consideration for the Commission is access to the resources needed to undertake all the duties of a unitary authority. Both proposed unitary authorities would have significant challenges recruiting and retaining professional specialist staff to deliver their statutory regional functions. This is due to their proposed size relative to the technical scale and scope of regional functions, and labour market conditions for this type of capability. More information on this can be found in the Commission’s decision paper.

Q. What options do the applicants have if they are not satisfied with the decision?

A. Anybody who is ‘party to proceedings’ before the Commission may appeal to the High Court in New Zealand on a point of law, if they are dissatisfied with the decision.

Q. When will documents be released?

A.  The decision paper and supporting documents will be available on the Commission’s website (www.lgc.govt.nz) at 3.30pm this afternoon following today’s meetings.

A brief history of the Auckland reorganisation application

  • November 2013: The Local Government Commission receives an application from Northern Action Group (NAG) for the constitution of a North Rodney Council as a unitary authority separate from Auckland Council
  • June 2014: the Commission declines to assess the application principally on the grounds that to do so would not be in the public interest.
  • April 2015: the High Court says the Commission was wrong in law on the public interest ground following an appeal by NAG but right in requiring more information
  • August 2015: having received and considered further information from NAG, the Commission agrees to assess the application
  • December 2015: the Commission receives an application from Our Waiheke for a unitary authority separate from Auckland Council
  • March 2016: Commission agrees to assess Our Waiheke application
  • April 2016: Commission determines that the affected area for the NAG application is all of Auckland Council area rather than just North Rodney and calls for alternative applications
  • May 2016:  Commission determines the Our Waiheke application to be an “alternative application’’ in the existent Auckland Council reorganisation process initiated by NAG
  • July 2016: Commission publishes 38 proposals for change
  • Sept 2016-Feb 2017: Commission carries out engagement programme with public in North Rodney and Waiheke and with stakeholders in wider Auckland Council area
  • March 2017: Commission publishes record of engagement
  • March 2017: The Commission meets with applicants and alternative proposers to present Morrison Low’s initial assumptions and to invite feedback
  • July 2017: As part of identifying the “reasonably practicable options’’, consultants Morrison Low provide a report on the financial and technical aspects of a long list of potential options.
  • May-Oct 2017: Commission officers prepare communities of interest studies for Rodney and Waiheke
  • Sept-Oct 2017: Peer review and expert panel assessment of Morrison Low report
  • Sept-Oct: UMR contracted to undertake phone survey and focus groups to provide the Commission with further information about community support for various possible options or aspects of local government reorganisation in Rodney area
  • November 2017: Commission makes a decision on its preferred option for local government in Auckland

Local Government Reorganisation: summary

The process for local government reorganisations under the Local Government Act 2002 is (broadly):

  • Individuals, organisations or the Minister of Local Government can apply to the Commission for reorganisation of local government.
  • If the Commission decides to assess the application, it will then determine the ‘’affected area’’.
  • If the Commission determines there is general support in the district of each affected territorial authority for local government reorganisation in the affected area, it will give public notice of the application and call for alternative applications.
  • The Commission then identifies reasonably practicable options for local government for the affected area – which must include the status quo.
  • From the reasonably practicable options, the Commission identifies its preferred option.
  • If the preferred option is the status quo, notice is given to the applicants and affected councils and the process ends.
  • If the preferred option is not the status quo, notice is given to the applicants and affected councils and the Commission develops a draft proposal.
  • A draft proposal is subject to consultation, including submissions and in some cases a hearing or a series of hearings.
  • If the Commission decides to proceed it issues a final proposal. Otherwise it can choose to end the process, or identify a new draft proposal for consultation.
  • If requested by the community a poll on the final proposal is held.
  • If no poll is requested or the poll shows the necessary level of support for the final proposal, the final proposal is implemented.

Media contact:

Simon Cunliffe | Local Government Commission | Department of Internal Affairs Te Tari Taiwhenua

DDI +64 4 474 8164| MOB +64 27 809 3833 | Simon.Cunliffe@dia.govt.nz