Speech by Michael Bassett to ACT Supporters, Mecca Cafe, Newmarket, Auckland
Friday, June 26 2009

GENERAL OBSERVATIONS:

1. Local government reform was talked about for a century after the abolition of the provinces in 1876. Territorial Local authorities and special purpose boards grew in an ad hoc manner. There were counties, boroughs, cities, town boards, county towns. Prime Minister Seddon expressed his unease and promised to legislate. Arthur Myers, Auckland's mayor 1905-1909, and possibly our greatest, had a bill drawn up when he was in Parliament. But nothing came of it. In his experience, too many local authorities became an impediment to extra-territorial improvement schemes, especially within cities.

2. There were special purpose boards too: harbour boards; hospital boards; at one stage as many as 320 roads districts; urban drainage districts; as many as 52 rural drainage districts; main highways boards; river districts; water supply districts; tramway districts and transport boards; gas lighting boards; electric power districts; fire districts. Each perceived need resulted over time in a new category of authority. No thought was given about whether an existing group of elected people could undertake the new function.

In rural areas, there were Nassella tussock boards, rabbit boards, and local railways districts. You name it; we had a local authority to cover it. All up in the 1920s there were about 1100 different local authorities for a country with a population of less than one and a half million. One authority to every 1,300 people! Seddon was only slightly exaggerating when he said in 1895 that every fifth man in the country seemed to be a member of an elected authority.

3. Vanity was the main obstruction to amalgamation. A character in Shakespeare's Measure for Measure wails: "Man, proud man, dressed in a little brief authority, most ignorant of what he's most assured…" A fellow Auckland City Councillor, Mel Tronson, once warned me that melting the mayoral chain would always be a difficult challenge. Well, I managed to do it. There were nearly 800 local authorities left by the 1980s, with a variety of revenue-raising powers. With the help of Brian Elwood of the Local Government Commission, we melted those chains of office to 12 regional councils; 74 territorial authorities; and 155 community boards that are - as they stand - creatures of their territorial authorities. In all, only 86 authorities across the country now have a capacity to rate.

AUCKLAND:

I won't go into the failed attempts to rationalize local government starting with Dick Seddon. It's a sorry tale of lack of vision and constant self-promotion by second-rate people, with governments too timid to do what the public realized needed doing.

Early in 1989, just as the ink was drying on the Local Government Commission's new schemes I received an invitation from Mayor Cath Tizard to lunch with the then editor of the Herald. If I was prepared to go with one big city in Auckland the Herald would be prepared to get in behind the campaign. The offer was tempting. In those days the Herald was a quality paper and it didn't employ Bernard Orsman. Possibly the current problems could have been avoided? But it was too late. As I say, the ink was dry on the new schemes, and we'd run out of time.

However, instead of 43 territorial and special purpose boards in the Auckland region in 1989, we narrowed them to eight, including the region. But I didn't get time to alter the powers of local government - although I was able to achieve better rules for the control of trading organizations and more clearly defined relations between councils and bureaucrats.

But today there are still overlapping jurisdictional problems. For example, take the ARC and its authority over the waterfront. First the ARC is a body relatively starved of cash compared with the Auckland City Council, thanks to Warren Cooper in 1992 taking away some functions and its main cash cow. Not surprisingly, the more affluent ACC has designs on the waterfront, the port etc. So it should. The waterfront is the city's gateway. But as things stand, the ACC has the planning powers to stop, or to mangle initiatives from the ARC and Auckland Regional Holdings, the legal owners of the Ports' land. The City Council has been quite open about miss-using its powers. It can be judge and jury in its own cause.

There are many other examples of this across the region. And therefore an obvious need for streamlining. And there must be someone with a structure and vision that will not be constantly second-guessed by others disputing his/her mandate. Auckland is now a large city whose airport, port, and inter-city relations around the Pacific matter for ours, and their futures. In our globalised world Auckland needs to be promoted around the Pacific as a good place for investment, and in which to do business. The current structure cannot guarantee this.

There's another reason for change. It's called evolution. Technology has made aspects of my structure ready for the scrap heap. Since 1989 the internet has revolutionized how people relate to each other, to the media, and to their councils. We saw people using email to an extraordinary extent at the time of the stadium debate in 2006 to communicate their views to their representatives and to the media. The result of the new technology is that most community boards have become unattended gatherings with only a handful of squeaky wheels present, people like Penny Bright, Lisa Prager and an assortment of discombobulated loonies such as I witnessed at a recent meeting of Nikki Kaye's called to discuss the restructuring. Ordinary folk just want their elected representatives to get on with the process, and they'll let their representatives know by email if things seem to be going wrong.

I won't bore you by recounting the recent history that ended up with the Royal Commission. The RC was a good idea in the sense that three of the 'great and the good' got to hear somewhere in the vicinity of 3,700 submissions, travel about and talk to people, consult widely, test out their ideas, and then produce their recommendations. It was a substantial document, as you know, dealing with a huge number of issues. It was not something to be dismissed lightly. That report possessed considerable moral authority.

The Royal Commission was a gift to Rodney Hide and to the new Government. Their Labour opponents had carefully selected the personnel, and had drawn up the terms of reference. The major weakness was that the commissioners were constrained to take - as their base document - the Local Government Act 2002 which, as you'll all be aware, is deficient in many respects, most notably its power of general competence. Many less than competent councillors misuse that power of competence, using our funds.

IMPLEMENTING RE-STRUCTURING

My initial reaction to the Royal Commission was to welcome most of its report, and to argue that it should be put into a bill or bills, taking submissions from interested parties on them. I favoured earmarking several areas – the proposed waterfront development region, the Maori seats, the total number of councillors for the Auckland Council, and the at-large/ward elected numbers. These areas were the ones on which the government had reservations, and which would be the subject of careful cross-questioning when it came to those hearings. On matters like the Maori seats the draft Bill could have had a separate section that invited comments on words like this statement: Since the beginning of local government in Auckland there has been no representation based on race. Questions: Do you think it should be introduced in 2010. If so, why? Since there are more Pacific Islanders in Auckland than Maori, should they have separate representation? Asians too perhaps? Maybe Dutch? Or should Aucklanders acknowledge that we all have equal rights?

It's a safe bet that no one would have been unable to argue convincingly for race-based representation. Certainly the Treaty is of no assistance to Maori on this issue since democracy existed nowhere except, perhaps in the United States, in 1840.

I also favoured proceeding with the six entities specified in the Royal Commission report, firstly because that was the least disruptive of the status quo. Buildings exist, and it would be easier to work out which were surplus to requirements. With the local councils tied closely to the Auckland Council, it seemed to me that so long as they were without their own rating powers, the six could work. The most important reason for proceeding with the RC report, however, was because it possessed moral authority.

Sadly, the decision quickly to announce unilateral changes to the RC report, instead of holding on to them through the submission stages, freed everyone of any tie to the Royal Commission process. What was now going to happen became the government's responsibility. In reality, the loudest critics had all had a chance to make submissions to the RC. Labour was completely tarred with responsibility for it. The one person on the Commission with considerable local government experience was a Head Office member of the Labour Party. These facts could have been tightly hung around Labour's neck. Instead, those few unilateral changes made quickly by the Government let Labour off the hook.

What I am saying is that the opposition could have been corralled more easily had there been no more than signals that, depending on submissions, the Government could make changes to the RC formula in those defined areas relating to wards, the waterfront region, Maori representation etc.

DON'T GET ME WRONG - there is, of course, inevitability about some opposition to any restructuring, no matter what strategy is used. Over the years such opposition has always been driven by staff and councilors who haven't yet worked out where they fit into the new scheme of things. There are a few nutters around the edge as well, like Penny Bright and Lisa Prager and the guy with the pork-pie hat and the camera that he trains on anyone who he disagrees with, but they really want to go back to some idealized version of the 1950s. Communism is surely the most reactionary philosophy on the globe.

In my view the Six Unit idea below the Auckland Council always made more sense than 20 to 30 local boards. Since they were announced on 7 April, the Government has continued to struggle to justify them. What will those local boards do? That is still so fuzzy as to cast doubt on their worth. Six units below the top council elected on a ward basis have a more substantial feel to them and could be of more use both to the council and to ratepayers.

If the six were resurrected, and had delegated authority and were devolved the funds to let contracts for, say, rubbish, roads and footpaths, possibly even caring for the regional parks in their areas, and the beaches and boat ramps, and the walkways and the cycle ways, then there could be reasonably robust competition amongst contractors. With 20-30 local boards it beggars belief that contractors won't be able to sew them up easily. Either that or they will relate solely to the top council. More important, there never have been enough really competent individuals willing to stand for local office over the wider Auckland area to head up 20-30 local boards.

But there is an over-riding fear that I have: the existence of 20-30 local boards will be a standing invitation to some political party at a later date to promise them rating powers. Then we'd be back to pre-1989, and Penny Bright's and Lisa Prager's iconic world. The 20-30 idea HAS NOT been well thought through.

THE TRANSITION AGENCY AND A PERIOD OF UNEASE

Right now, there is a period of maximum uneasiness in the Auckland scene. There is a wide-spread feeling amongst those with a current electoral mandate that they don't know what they are allowed to do. This uncertainty stems from provisions covering the Auckland Transition Agency. Those powers, in my opinion, go too far. Initially it was planned to have every bit of spending above $5,000 go before the agency. That seems to have been altered to $20,000, but that still means that the ATA is involved in micromanaging, which in my experience, goes beyond what is needed to preserve the integrity of those new authorities in the process of being formed. There will be, indeed, there already are, efforts underway for 'legacy projects'. There were in 1989 too. Several seedy members of the old Auckland Harbour Board tried to squirrel away $8 million of funds belonging to the board into trusts, the revenue from which they would distribute to their mates. One borough town clerk tried to get away with some land, and had to be stopped. Those are the sorts of things that a transition agency is there to keep an eye on, as well as ensuring that senior officers of the new entities are selected properly. But remember, change goes best if it isn't micromanaged.

However, the other day I saw a letter from the CEO of the Transition Authority to one of the CEOs of an existing authority. It read something like this: Dear X, I notice there are aspects of your plans for this year that appear to require our oversight. Please make an appointment to come and see me. It was a bit like the headmaster calling in an errant schoolboy! The guy didn't even have the courtesy to sign that letter. It was one of those pp jobs. What I am saying is that already there is at least one swollen head at the Transition Authority 'dressed in a little brief authority', and he is bound to cause trouble unless spoken to sharply. Over the next 16 months many elected people with bruised egos will be ringing the newspapers with similar stories. What I am saying is that there is bound to be trouble unless a firm hand is exercised by the minister and the chair of the ATA over their staff, and a more conciliatory attitude adopted towards those who, after all, still enjoy an electoral mandate.

I should add that at least one of the existing councils also appears to be acting unwisely. Several senior Auckland City officers are confiding to people that they expect Auckland City to form the nucleus of the new entity, with themselves in positions of authority after the October 2010 election. One employee has been heard to say to another of an outlying council: 'send us your CV and I'll see if we can fit you in'. That, too, requires firm handling by the ATA. Its role at best is acting as a facilitator for the purpose of ensuring that the best and the brightest, from wherever they currently are employed, get to run the new city in the interests of the ratepayers, NOT the employees. I must stress that point. The new structures are for the ratepayers, NOT the employees. Nobody in this process should be let to feel they have an inside track. The Minister and the ATA chair ought to make that clear publicly to representatives of all existing authorities.

CONTRACT ARRANGEMENTS BETWEEN THE ELECTED AND BUREAUCRATS:

One of the major improvements that came administratively both with central and local government reforms in the 1980s, was the introduction of contracts between CEOs and elected officials. They revolutionized the constant meddling that the elected engaged in. The changes in the 1980s required executives and the elected to crystallize their ideas. The elected had to define carefully what it was they wanted to achieve, and it then kept them clear from the day-to-day running of the enterprises. However, it is already clear to me that with the largest existing local authorities, political input is difficult. A large, billion dollar organization like the Auckland City Council has many layers of responsibility throughout it. A detailed contract between the councilors and the CEO is not enough to ensure that political goals are achieved. The bureaucracy often seems to carry on regardless. I like to taunt a friend who is on the council with the words: "When do you and your team intend to take office?" Things that were defining issues at the October 2007 election appear to trundle on regardless.

The new Auckland Council covering 1.4 million people with hugely varied responsibilities will need committee chairs of considerable ability. They will have wide responsibilities. I'm hoping that thought is being given to introducing some form of contract arrangement between each chair, and his/her section head, with, of course, overall responsibility resting in the hands of the Mayor, the CEO and the Auckland Council. This would be a bit like the contracts between each Minister and his/ her CEO. There will have to be almost day-to-day contact between the chairperson of an Auckland Council committee and his/her section head. It will be impossible to channel all authority up through the CEO of the whole organisation. Auckland City will be all at once a business, but with a vital elected/democratic component. Balancing those realities needs careful attention to detail.

Make no mistake about it, the new city is an enormous undertaking. The Auckland Council will require a new CEO from outside those currently holding CEO positions. That means higher remuneration too. The old adage holds: pay peanuts and you get monkeys. Aucklanders need to get their heads around modern day realities. There's a role there for the media to help explain this. If the new system is to work the time for shock/horror/probe has gone.

Above all, the new Auckland Council doesn't mean transferring 6,500 people, holus bolus, from the existing councils to automatic positions within the new structure. There has to be a mixture of retirements and sinking lids, and may be some redundancies. Otherwise there will be people holding non-jobs, and the expense to the ratepayers will make the whole exercise worthless. The changes must belong to the people, not the employees.

Any politician who says there won't be any redundancies is fooling the public and calling into question why we are engaged in this huge exercise.

Rodney, I wish you well. Stay firm. But stay flexible where it matters.