TAKING THE PULSE OF LOCAL GOVERNMENT IN

NEW ZEALAND 2017A report on the issues concerning Mayors and Chairs

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About Simpson GriersonSimpson Grierson is New Zealand's leading local government law firm. Our expertise ranges from the day-to-day operation of councils in their statutory and political environments, to the highest level strategic developments affecting local government as a whole.

We advise many of the local authorities in New Zealand, including major city and regional councils based in Auckland, Wellington and Christchurch. We have extensive and long-standing networks with key policy and decision makers throughout local government.

About LGNZLocal Government New Zealand is the strong voice for great local government.

It is governed by a National Council, made up of 15 elected members from throughout New Zealand. LGNZ's purpose is to deliver the sector’s Vision: “Local democracy powering community and national success.”

LGNZ represents the national interests of councils in New Zealand and leads best practice in the local government sector. It provides advocacy and policy services, business support, advice and training to members to assist them to build successful communities throughout New Zealand.

Contacts

Malcolm Alexander – Chief ExecutiveLGNZ

Email: malcolm.alexander@lgnz.co.nz

Jonathan Salter – PartnerSimpson Grierson

Email: jonathan.salter@simpsongrierson.com

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Introduction 2

Our 10 Key Findings 3

Key Finding 1: Investment and growth provide the greatest opportunities 4

Key Finding 2: Water resources and management, and funding infrastructure for growth and renewals are the greatest challenges 6

Key Finding 3: Funding and affordability issues remain by far the biggest impediments 7

Key Finding 4: Housing affordability is a major issue for communities, but the National Policy Statement on Urban Development Capacity doesn't provide tangible solutions 9

Key Finding 5: Inequality, substance abuse and poverty are the greatest social issues, but primary responsibility lies with central government 11

Key Finding 6: Funding and investment in infrastructure pose the biggest challenges to improving communities' resilience and preparedness 14

Key Finding 7: Swimmable lakes and rivers by 2040 is achievable 15

Key Finding 8: There is strong support for reversing the current statutory presumption that freedom camping is authorised except where it is specifically prohibited 17

Key Finding 9: Opinion is divided on whether new mayoral powers have enhanced governance arrangements, but endorsement that new annual plan consultation has improved community engagement 18

Key Finding 10: NZTA makes the most effective contribution to local authorities 20

Methodology 21

Contents

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This survey was carried out in June/July 2017. Responses were received from Mayors and Chairs of 55 rural, provincial, metropolitan, and regional councils throughout New Zealand, a response rate of 71%.

Welcome to the 2017 'Taking the pulse of local government in New Zealand' report. After receiving so many thought-provoking responses to our earlier surveys, we thought in election year it was time to ask again what Mayors and Chairs of local authorities think about the major issues facing their organisations and communities.

The quantity and quality of the responses we have received has, once again, been impressive. We would like to thank the 55 respondents who represent the leaders of 71% of New Zealand's local authorities.

Funding and affordability has been revealed by the survey to be the biggest impediment to local authorities achieving results for their communities. For a majority of respondents, funding was the 'single biggest thing' that kept them awake at night. Intensified financial support and investment in local communities from central government was repeatedly identified as a solution to the issue of funding.

Responsibility for social issues, including inequality, poverty, and substance abuse, was overwhelmingly seen as lying with central government. As in 2015, inconsistency in central government

policy making was further revealed to be a major hindrance to councils achieving results for communities.

However, an encouraging result of the survey was the diversity in the greatest opportunities open to councils and their communities, including iwi investment, local business growth, population growth, water resources, transport, and tourism. Taking into account the vastly different needs and resources of local authorities across New Zealand, this result seems to suggest the presence of an overall positive and responsive attitude in local government.

Simpson Grierson and LGNZ are delighted to have collaborated on this research project. We hope you enjoy reading this report and find it a helpful insight into the current perspectives of local government. We look forward to discussing it with you at the LGNZ conference and would welcome your feedback.

Thanks again for your support with this initiative.

Introduction

Jonathan SalterPartnerSimpson Grierson

Malcolm Alexander Chief ExecutiveLGNZ

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Our 10 Key Findings

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1: Investment and growth provide the greatest opportunities

2: Water resources and management, and funding infrastructure for growth and renewals are the greatest challenges

3: Funding and affordability issues remain by far the biggest impediments

4: Housing affordability is a major issue for communities, but the National Policy Statement on Urban Development Capacity doesn't provide tangible solutions

5: Inequality, substance abuse and poverty are the greatest social issues, but primary responsibility lies with central government

6: Funding and investment in infrastructure pose the biggest challenges to improving communities' resilience and preparedness

7: Swimmable lakes and rivers by 2040 is achievable

8: There is strong support for reversing the current statutory presumption that freedom camping is authorised except where it is specifically prohibited

9: Opinion is divided over whether new mayoral powers have enhanced governance arrangements, but endorsement that new annual plan consultation has improved community engagement

10: NZTA makes the most effective contribution to local authorities

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Investment and growth provide the greatest opportunities

Our first set of questions focused on the 'big picture' issues for Mayors and Chairs.

When it comes to the factors that can provide the greatest opportunities for councils and their communities, there was a range of responses.

Of the 55 respondents who answered this question, the majority selected a form of investment – either local business growth and investment (47%), transport and infrastructure investment (36%), Iwi investment (35%), or external investment into your district/region (31%).

While the majority of respondents favoured investment opportunities on the whole, population growth was second on the agenda, with 45% of respondents suggesting this could provide a significant opportunity for their councils and community over the next five to ten years.

Tourism and events was identified by 35%.

"Township revitalisation – making our towns more welcoming to visitors, and permanent people moving here for lifestyle choice." Don Cameron, Mayor, Ruapehu District Council

"Investment by central government into rural areas (that is easily achievable) to grow rural areas and take away the congestion in the bigger centres, particularly Auckland." Craig Little, Mayor, Wairoa District Council

Key Finding 1

"Digital transformation – massive change is coming." Donna Favel, Mayor, Ashburton District Council

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Q2. Which of these factors provide the greatest opportunities for your council and your community over the next five to ten years? (Respondents could select up to three issues).

Local business growth and investment 47%

Transport and infrastructure investment 36%

Population growth 45%

Water resources and management 36%

Tourism and events 35%

Iwi investment 35%

Environmental management 25%

Local government reorganisation 7%

External investment into your district/region 31%

Cost management 7%

Rating and funding reform 7%

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Funding infrastructure for growth and renewals 44%

Rates affordability 39%

Water resources and management 44%

Risk and resilience and natural hazard preparedness 35%

Transport and infrastructure affordability 33%

Impact of tourists/visitors 31%

Social issues such as homelessness, safety and substance abuse 17%

Population change (growth or decline) 13%

Economic growth and jobs 24%

Housing affordability 15%

Water resources and management, and funding infrastructure for growth and renewals are the greatest challenges

Key Finding 2

Q3. Which of these issues provide the greatest challenges for your council and your community over the next five to ten years? (Respondents could select up to three issues).

We asked Mayors and Chairs which issues provide the greatest challenges for their councils and communities over the next five to ten years. Funding infrastructure for growth and renewals (44%) and water resources and management (44%) were considered the greatest challenges by the majority of local authorities. Local authorities are also struggling with rates affordability (39%) and risk and resilience and natural hazard preparedness (35%).

This is quite a change from the 2015 survey, where economic growth and jobs was overwhelmingly considered the major challenge (69%).

"With the district becoming more attractive to live and work, there could be a widening gap of long-term residents who cannot afford to rent and/or find suitable work. Rural broadband and cell phone coverage is important to provide better job creation and social contact." Don Cameron, Mayor, Ruapehu District Council

"There is a need for central government co-investment in housing." Steve Chadwick, Mayor, Rotorua Lakes Council

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Funding and affordability issues remain by far the biggest impediments

Key Finding 3

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78%

30%

48%

20%

7%

6%

2%

Funding and affordability issues

Central government

Inconsistency of central government policy making and legislative changes

Public perception of local government

Unwillingness of elected Councillors to work collaboratively

Lack of engagement from your community

Population decline

Q4. What are the biggest impediments you face in achieving the results you wish for your community? (Respondents could select up to two issues).

Question 4 asked respondents about the biggest impediments they face in achieving results for their communities.

The majority of respondents (78%), across all types of local authorities, indicated that funding and affordability issues are the major impediments. Inconsistency of central government policy making and legislative changes was a clear second major impediment (48%).

These results are consistent with our 2015 survey.

"Central government, funding and affordability issues, and inconsistency of central government policy making and legislative changes go together and we have seen many strange government decisions, which local government either has to cover or wear the fall out. Above all being able to fund growth and still keep the city affordable is a real challenge."

Grant Smith, Mayor, Palmerston North City Council

"We are feeling and seeing the growing gap between wealth and poverty. Central government is disinterested in demarcation zones where local leadership can set shared objectives and manage devolved resourced to a local level."

Steve Chadwick, Mayor, Rotorua Lakes District Council

"Earthquake Prone Building issues are a concern – there's the potential to destroy the Fielding CBD and lose our Edwardian heritage. The required investment does not stack up economically for building owners. Legislated timeframes are not achievable."

Helen Worboys, Mayor, Manawatu District Council

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Q5. We also asked the Mayors and Chairs, as community leaders, what was the single biggest thing that keeps them awake at night. By a significant margin, funding affordability was that issue!

"Having resources and funding to make the most of the potential this place has without driving rates to an unaffordable level," Winston Gray, Mayor, Kaikoura District Council

"Providing modern facilities to make our district a more affordable place to live. We have plenty of jobs, but significant numbers drive in each day to work. We want to provide modern, fit-for-purpose recreational facilities to make us as attractive as larger centres, but have limited ability to fund such facilities, and the marketing required to support strong "liability" campaigns," Brian Hanna, Mayor, Waitomo District Council.

"Population growth. We have growth, but with very low unemployment and strong economic growth we need to attract, retain new and existing people into our district. We need better central government tools to encourage migrants (and others) to move to rural provincial New Zealand." Damon Odey, Mayor, Timaru District Council

"A visitor levy, or bed tax." Jim Boult, Mayor, Queenstown Lakes District Council

"A portion of GST." Tony Bonne, Mayor, Whakatane District Council

"Congestion charging revenue." Chris Laidlaw, Chair, Greater Wellington Regional Council

"Central Government funding as a co-investor in major infrastructure." John Tregidga, Mayor, Hauraki District Council

Question nine asked respondents if they could have access to one new source of funding, what would it be?

The results were overwhelmingly in favour of some form of increased central government investment and support (83%). More specifically, 25% proposed a portion of GST and 25% proposed the implementation of a tourism levy either regionally or at a national scale. Others sought government support for water and roading infrastructure, loans for social housing, and the reinstatement of funds for smaller communities.

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Housing affordability is a major issue for communities, but the National Policy Statement on Urban Development Capacity doesn't provide tangible solutions

Key Finding 4

No

30%

Yes

70%

Q6. Do you consider housing, and affordability, to be an issue for your community?

The following set of questions asked Mayors and Chairs to consider housing affordability, the most significant constraints, and whether the National Policy Statement on Urban Development Capacity will provide tangible solutions to the issues.

The majority (70%) believe housing affordability is a significant issue for their community (although only 15% regarded it as a top three issue). Of the 70%, respondents believe market forces to be the most significant constraints (40%), followed by funding new infrastructure (24%). Land availability/supply was identified as a significant constraint by a mere 5%.

"As the least affordable district in New Zealand this is a major issue for our council." Jim Boult, Mayor, Queenstown Lakes District Council

"Central government should provide the social housing stock to meet their needs and then the market will correct itself. It is not the role of local government to provide housing stock." Garry Webber, Mayor, Western Bay of Plenty District Council.

"We have high growth, increasing prices, and low income and young people are increasingly squeezed." Richard Kempthorne, Mayor, Tasman District Council

"The big increases in property prices in Auckland are flowing through to our region reducing affordability." Bill Shepherd, Chair, Northland Regional Council

"Values have been rising, but we are middlish compared to Christchurch. There is ample land for housing development in the medium term." David Ayers, Mayor, Waimakariri District Council

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Q7. If yes [you consider housing, and affordability to be an issue for your community] what do you consider to be the most significant constraints? (Respondents were asked to select up to two options).

40%

22%

24%

5%

Market forces

Planning framework

Funding new infrastructure

Land availability/supply

Yes

22%

No

78%

Q8. If yes [you consider housing, and affordability to be an issue for your community] do you consider that the National Policy Statement on Urban Development Capacity will provide tangible solutions to the issues?

"We find difficulty in recruiting qualified planners to process the increased demand in building and resource consents." Sheryl Mai, Mayor, Whangarei District Council

"Policy is too focussed on Auckland's issues." Helen Worboys, Mayor, Manawatu District Council

"There are issues with these policies delivering sub-optimal urban design outcomes, not taking into account hazards. There's a lack of ability to get public transport into subdivisions, for example." Stephen Woodhead, Chair, Otago Regional Council

There have been blocks 'land-banked' by a few key landowners who only release or develop when the price is right � constraining the market. We need more subdivisions opened up." Grant Smith, Mayor, Palmerston North City Council

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Inequality, substance abuse and poverty are the greatest social issues, but primary responsibility lies with central government

Key Finding 5

The next set of questions covered social issues within each region or district. Forty-five percent of respondents believe inequality is the greatest concern, followed by substance abuse (41%) and poverty (37%).

Q12. What are the main social issues in your district or region? (Respondents could select up to two options).

45%

37%

41%

25%

Inequality

Poverty

Substance abuse

Crime

14%Homelessness

8%Unemployment

4%Begging

"Inequality – and perceived inequality – I believe holds some of our people back from realising their potential." Winston Gray, Mayor, Kaikoura District Council

"I think poverty is a real but unseen problem in our region. However P is a huge problem which crosses our socio-economic lines." Richard Kempthorne, Mayor, Tasman District Council

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However, the vast majority of respondents (84%) believe these issues fall within the responsibility of central government. To the extent it is councils' responsibility, 63% of respondents believe they do not have the powers and tools to make a difference in addressing these issues.

Q13. Do you regard primary responsibility for these issues as falling on the council or central government?

"I believe council does also have a role in creating a positive healthy community. We must get those disengaged from everyday education, to engage in bettering themselves by any means."Winston Gray, Mayor, Kaikoura District Council.

"Central government continues to dump responsibilities on local authorities without taxpayer funding coming with it." K Gurunathan, Mayor, Kāpiti Coast District Council

"This needs to be a balanced partnership between council and government." Don Cameron, Mayor, Ruapehu District Council

84%

12%

Central government

Joint responsibility

4%Council

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Q14. To the extent it is the council's responsibility, do you think that your council has the powers and tools to make a difference in addressing these issues?

Yes

37%

No

63%

"We have certain tools, but this requires a whole of community response." Richard Kempthorne, Mayor, Tasman District Council

"We hosted the only really successful social sector trial, and made huge gains in key targeted areas. Our biggest challenge was gaining support from government agencies, who felt threatened, as we held them to account!" Brian Hanna, Mayor, Waitomo District Council

"Not as much as we should – nor the resourcing." Lianne Dalziel, Mayor, Christchurch City Council

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Funding and investment in infrastructure pose the biggest challenges to improving communities' resilience and preparedness

Key Finding 6

Q18. What are the biggest challenges for your council in improving your community's resilience and preparedness? (Respondents could select up to two options).

42%

25%

Investment in relevant infrastructure

Community engagement

Financial pressure and funding issues

Regulatory environment

43%

55%

"We've had a major earthquake sequence and another close by. We have been doing what we need to do and our community has supported us. The real challenge was the September 2010 quake." David Ayers, Mayor, Waimakariri District Council

"We need national leadership and regulations. Having 74 local government organisations doing their own thing is an absolute waste of resource." Garry Webber, Mayor, Western Bay of Plenty District Council

"Specifically regarding climate change, it is lack of long term understanding." Dave Cull, Mayor, Dunedin City Council

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Swimmable lakes and rivers by 2040 is achievable

Key Finding 7

One set of questions asked whether Mayors and Chairs thought that the government's water reform programme (including the target of 90% of rivers and lakes swimmable by 2040) is achievable for New Zealand. Eighty percent of respondents said yes.

Q10. Do you think that the government's water reform programme (including the target of 90% of rivers and lakes swimmable by 2040) is achievable for New Zealand?

No

20%

Yes

80%

"Although I have said yes it cannot be made at the expense of our productive capacity and it will be challenging for the community to afford the necessary measures." Bill Shepherd, Chair, Northland Regional Council

"We need a more sensible definition of what swimmable is." Jim Mylchreest, Mayor, Waipa District Council

"But [central government] need to recognise the costs to local government to meet the capital costs to achieve their goals." Garry Webber, Mayor, Western Bay of Plenty District Council

"Subject to strong government financial support and good scientific backing. Has to be economically achievable and sustainable." Alan Livingston, Chair, Waikato Regional Council

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However, 56% of respondents believe the biggest challenge in achieving the national target depends on funding for infrastructure upgrades, followed by land use changes (44%).

Q11. What do you think will be the biggest challenges for your region/district in achieving the national target (90% of lakes and rivers swimmable by 2040? (Respondents could select up to two options).

56%

30%

44%

27%

Funding for infrastructure upgrades

Regulating nutrient levels

Land use change

Existing contaminant levels

23%Community support

15%Technical capability

"A pragmatic approach is required to ensure investment is made to maximize benefits. There is no point in investing millions of dollars on point source community discharges, where there will be no measurable environmental gain, when that community investment could be better targeted to riparian planting in the rural areas. The whole community needs to work together on this one so that the economic impacts are not so severe." Jim Mylchreest, Mayor, Waipa District Council

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There is strong support for reversing the current statutory presumption that freedom camping is authorised except where it is specifically prohibited

Key Finding 8

Q16. Would you support a change to the fundamental proposition of the Freedom Camping Act – ie so that freedom camping is prohibited unless it is specifically provided for?

No

24%

Yes

76%

"The current situation is not sustainable and nor is the idea of continually providing more free-for-use infrastructure as more and more freedom campers are encouraged to arrive." Dave Cull, Mayor, Dunedin City Council

"I could write a book. However, three suggestions: 1.on board facilities are a proper flush toilet. 2. make fines the responsibility of the vehicle owner not the hirer. 3. give councils uniformity across New Zealand to limit the number in some areas and ban in others." Jim Boult, Mayor, Queenstown Lakes District Council

"We value freedom campers, but need help in providing facilities for them." Sheryl Mai, Mayor, Whangarei District Council

The Freedom Camping Act 2011 currently provides that freedom camping is a permitted activity everywhere except where it is explicitly restricted or prohibited by a local authority bylaw. When asked whether this fundamental proposition should be changed, the majority of respondents (76%) indicated a belief that freedom camping ought to be prohibited unless provided for.

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Opinion is divided over whether new mayoral powers have enhanced governance arrangements, but endorsement that new annual plan consultation has improved community engagement

Key Finding 9

Respondents were asked whether the mayoral powers in section 41A of the Local Government Act 2002 have enhanced governance arrangements for their respective councils. Fifty-five percent agree, while 45% are of the opinion they do not.

Q17. Have the mayoral powers in section 41A enhanced governance arrangements for your council?

No

45%

Yes

55%

"I still use democracy and take council with me; what's the point of a power that can be over-ridden if your Councillors disagree?" Damon Odey, Mayor, Timaru District Council

"Mayoral powers really only work under present rules if you have the support around council table, otherwise you get overturned." Craig Little, Mayor, Wairoa District Council

"Yes, but you still need to bring the 'team of council' along with you." Grant Smith, Mayor, Palmerston North City Council

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Following the changes to the annual plan consultation requirements, the majority of respondents (62%) believe the changes have improved community engagement.

Q15. Have the changes to the annual plan consultation requirements improved engagement with your communities?

No

38%

Yes

62%

"The success of improved engagement depends on councils exploring new ways to involve people in our communities." Helen Worboys, Mayor, Manawatu District Council

"I feel we have the trust of the majority of our community to just 'get on with it'." Brian Hanna, Mayor, Waitomo District Council

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NZTA makes the most effective contribution to local authorities

Key Finding 10

Finally, respondents were asked which central government body makes the most effective contribution to local government. As in our previous two surveys, the majority of respondents agree that it is the NZ Transport Agency (55%).

The Ministry of Business, Innovation & Employment was a clear second choice (27%), with no other government body receiving above 10%.

Q19. Which central government body makes the most effective contribution to local government? (Respondents could select up to two options).

NZ Transport Agency 55%

Ministry of Transport 10%

Ministry of Business, Innovation & Employment 27%

Department of Internal Affairs 10%

Department of the Prime Minister and Cabinet 8%

Ministry for Primary Industries 6%

Ministry of Social Development 2%

Local Government and Environment Select Committee 2%

Statistics NZ 2%

"Our ability to manage and improve our infrastructure relies heavily on good support from NZTA." Helen Worboys, Mayor, Manawatu District Council

"Central government agencies in general lack understanding of the modes and accountability of local government." Chris Laidlaw, Chair, Greater Wellington Regional Council

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Methodology This research draws on 55 responses from the Mayors and Chairs of local authorities across New Zealand. Questions in the survey were not compulsory leaving respondents to answer the topics they were most knowledgeable about. The respondents were from a mix of rural, provincial, metropolitan, and regional councils.

Question Number of responses

1 55

2 55

3 54

4 54

5 47

6 54

7 37

8 36

9 48

10 51

11 52

12 51

13 49

14 49

15 53

16 54

17 47

18 53

19 51

34.5%/19 respondentsProvincial Council

Q1. Please identify your category* of council

Metropolitan Council (including Auckland)

18%/10 respondents

Rural Council

Regional Council

13%/7 respondents* Category terms defined by LGNZ

34.5%/19 respondents

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