The Exceptions Based Annual Plan- Some Stakes in the Ground

Jonathan Salter17 August 2015

Overview• A recap on the 2014 Amendments• LTP issues• Annual plan consultation (or not)

Local Government Act 2002 Amendment Act 2014• Significance and Engagement Policy section 76AA• Consultation to give effect to section 82• Limited use of special consultative procedure• Long term plan consultation – sections 93A – 93G• Annual plan consultation – sections 95, 95A – 95B

Significance and Engagement Policy• Still covers significance and strategic assets• “engagement” is new• How the council will respond to community preferences about

engagement, including the form of consultation that may be desirable

• Clarity about how and when communities can expect to be engaged

• Section 82 to adopt or amend; section 80 applies to significant departures; summary in the LTP

Consultation under section 82• Instead of SCP but similar (or the same)• Section 82A requirements – what must be publicly available• No longer SCP:

– annual plan– revenue and financing policy– development contributions policy– rates remission and postponement policies (including on Maori freehold land)– bylaws below the significance threshold in section 156(1)(a)– establishment of a CCO

Consultation under section 82 cont’d• Still SCP:

– long term plan– bylaws above the significance threshold– rates replacement proposals; early payment policies– dog control policy– Class 4 venue (Gambling) policy– local alcohol policy– transfer of functions under various Acts– various others

Long term plan consultation• Special consultative procedure (section 83) with a consultation document

(sections 93A – 93F)• Underlying information – section 93G• Consultation document must meet the purpose in sectoin 93B and

include the detail from section 93C(2), and be as concise and simple as possible

• Effectively limits consultation outcomes– audit process– outcomes not in the consultation document

• Parallel consultation on some policies

Annual Plan Requirements• Council must prepare and adopt an annual plan before the

commencement of each financial year – s 95 (1) and (3)• Content requirements – s 95(5), (6) and (6A) and clauses 18 to

22 of Schedule 10• Annual budget and FIS for the year and identify variations

from financial statements and FIS in LTP for that year• In first year of LTP, LTP is the annual plan

Annual Plan Process• If no significant or material differences from content of LTP for

the year – consultation not required, ie Council resolution (but subject to SEP on engagement and sections 76-79)

• Otherwise consultation in a manner giving effect to section 82, with consultation document under section 95A

• If combined with an LTP amendment, must combine consultation document requirements into one CD and use SCP

AP Consultation Document• Purpose is to provide effective public participation in decision

process relating to council activities in the coming year and the effects on costs and funding by:– identifying significant or material differences between proposed plan and

content of LTP for the year– in a way that can be easily understood– to inform discussions– as concise and simple as possible– without containing or attaching a draft plan or policy or any detail from

Schedule 10 that isn’t necessary to the purpose

Mandatory content s 95A(2)• Explain identified differences including:

– significant or material variations or departures from financial statements or FIS;

– significant new spending proposals, associated costs, and how they will be met;

– any proposal to substantially delay, or not proceed with, a significant project, and financial and service delivery implications

• Outline expected consequences of proceeding with the above differences and implications for the financial strategy

Significant or material• “significant” – refer to SEP, but literally having a high

degree of significance• “material” – if it could, itself or in conjunction with other

differences, influence the decisions or assessment of those reading or responding to the consultation document (section 95A(5))

Conclusion• Annual plan is not subject to audit – but you might want

to talk to auditors!• If there is any change from LTP that is more than minor –

it would be a brave call not to consult• Key indicators – impact on financial strategy; changes to

FIS that affect rates (especially)• Consider including provisions in SEP to set expectations