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Grant Duncan

Auckland Council is it too big to last?

Auckland is a city-region under intense political pressure. simply , a middle term is conspicuous by its absence. ‘City’, ‘District’ Migration and development are transforming streetscapes and ‘Regional’ could not be used, as they and communities. Local government has to plan and budget were the kinds of entities being abolished. Auckland Provincial Council would have for significant investments in infrastructure as the city grows, resurrected an entity abolished in the 19th century; ‘Shire’ sounds too Australian; and there is no strategy that pleases all sectors of residents State of Auckland would have raised the at once. Property owners love their rising asset wealth, but spectre of federalism. Auckland’s basic problem is one that central government is under pressure to address homelessness many other regions would love to have: growth. But then, how do you manage it? and home affordability. The Reserve Bank and the Treasury, Its population was 1,415,550 in the 2013 moreover, watch Auckland’s over-heated housing market census, and is predicted conservatively to reach 2 million by 2033. ‘Three- nervously, as it poses risk to the whole economy (Makhlouf, fifths of ’s population 2016). growth between 2013 and 2043 will be in Auckland’ (Statistics New Zealand, In the midst of this, a major restructuring (encompassing 4,894 sq km of land and 2015). Providing for this growth is costly of Auckland’s local governance and 3,702 km of coastline and embracing 30% for ratepayers (new infrastructure and administration has been undertaken. of New Zealand’s population). This new amenities) and for central government The formation of the Auckland Council entity was popularly dubbed the Super (new schools, state highways, etc), and in 2010 unified four metropolitan city City, somewhat misleadingly given that, in there is no end of argument over how to councils, two and a half district councils terms of area, the new authority is mainly plan for it. A struggle arose over whether and one regional council, comprising rural, although its population is mainly the urban space should intensify (grow a large urban, rural and marine area urban-dwelling. Being formally named up) or sprawl (grow out), and a political compromise was reached when the Grant Duncan is an associate professor in the politics programme at Massey University. He teaches council passed the unitary plan in August political theory and public policy at the Albany campus, Auckland. In 2016 he participated in an 1 independent evaluation of the unified governance model in Auckland. 2016.

Page 54 – Policy Quarterly – Volume 12, Issue 4 – November 2016 Blakely (2015) summarised the arguing that Auckland Council does ward on the council’s governing body planning issues in a previous issue of not represent or address the needs of (which has 20 councillors and the this journal; the present article considers their communities. So, how well have mayor), and select a team (of between the new governance structure of the the Auckland reforms worked out five and nine members) to make up Auckland Council itself, but not the in practice? Is the new model fit for their local board. The 21 local boards council’s administrative organisation. purpose? As a decision-making entity (or play an important role in local policy Central government considered that group of entities), is it achieving what it decisions and place-shaping, but they a unified governance structure was was supposed to achieve? And, even if it are not mini-councils, as they have no needed in order to provide the policy is working well, what further problems powers to raise rates or to pass by-laws. and planning effectiveness necessary to or needs for modifications have become They do have non-regulatory functions, manage the city’s growth. In the view apparent? and they have input into region-wide of the Royal Commission on Auckland The unification aimed for cohesive policy through their local strategic Governance,2 the aim was to achieve Auckland-wide planning within a single plans. It is the governing body that strategically cohesive and effective policy framework, and the new model approves the budget, makes the critical planning and decision making across the has settled in surprisingly well, given the policy and planning decisions and region, and to improve local participation sheer size and scope of the restructuring passes by-laws. The mayor has a ‘first and engagement. Efficiency and cost and the lengthy and contentious process mover’ role, initiating budget proposals reduction were not the primary concerns. towards a unified plan. My qualified and strategic plans, but has only one Businesses and central government were frustrated with having to deal with seven local authorities; it was considered Dissatisfaction with rates rises and desirable that Auckland should ‘speak with one voice’ (Chen, 2014). The reforms planning processes has emerged, but were set down in the Local Government it is not sufficient simply to ‘blame the (Auckland Council) Act 2009, without the endorsement of a local referendum. Super City’ for this ... This significant reform of governance was more than just an amalgamation. It introduced a two-tier structural model with an office of the mayor that endorsement of the unified governance vote on the governing body. This was new to local government in New model should not be taken as an briefly summarises the main elements Zealand at the time. Proposals for similar evaluation of the particular actions and of Auckland’s governance. Aspects of unifications in other regions (Northland, decisions of the Auckland Council. The this new model of local government Wellington and Hawke’s Bay) were unitary governance model and the actual have become politically controversial, roundly rejected after consultation and, performance of the council itself are however; this article sets out some of in the case of Hawke’s Bay, a referendum. obviously closely related, but they need those contentious issues and seeks to And most Aucklanders’ attitudes are to be assessed separately. Dissatisfaction put them into context. negative or indifferent towards the with rates rises and planning processes new local authority. The council’s own has emerged, but it is not sufficient The governing body performance-monitoring survey found simply to ‘blame the Super City’ for this, The mayor of Auckland appoints the that few residents express trust in the as one cannot prove that people would deputy mayor, chairs the governing body, council or satisfaction with its services. have been better off under the former establishes its committees and appoints Only 15% expressed satisfaction with the seven councils. Although the Auckland their chairpersons. The inaugural council’s overall performance; 17% trust model has some flaws, the challenge for mayor, , distributed the roles the council to make the right decisions; the time being is to make it work as well of committee chairs evenly among and 20% were confident that the council as possible. The present article identifies councillors across the political spectrum. is heading in the right direction. Critics aspects of the governance model that This helped to avoid partisanship of a of the council are especially prevalent in may require refinement. Looking long- kind that, at worst, could mean a stand-off the Rodney and Hibiscus and Bays areas term, it also asks whether Auckland in which a majority opposes the mayor. (Auckland Council, 2016). Those in rural Council, in its present form, is simply So, while there was a noticeable left–right areas feel that the new administration too big to last. political spectrum, no cohesive factions has an urban bias (Rose, 2015). Local The 2016 election, then, was the third (and certainly no whipped caucuses) advocacy groups in North Rodney and time that Aucklanders have participated emerged under Brown’s mayoralty. Waiheke Island formally proposed the in this governance structure as electors. Nonetheless, the mayor is given significant formation of separate unitary authorities They vote at large for one mayor, vote powers. Councillor Christine Fletcher to the Local Government Commission, for a councillor to represent their local observed that the inaugural mayor, the

Policy Quarterly – Volume 12, Issue 4 – November 2016 – Page 55 Auckland Council: is it too big to last? deputy mayor and the chair of the finance The office of the mayor Zealand, but the boards have no regulatory committee had ‘much of the control and The legislation gives the mayor the leading powers. They cannot pass by-laws or levy authority for day-to-day organisation and (but not decisive) role in planning and rates; their budgets are granted by the gatekeeping between the chief executive budgeting, and authorises him or her to governing body. The legislation states that and senior management, and access to be the voice of Auckland as a whole. To the local boards and the governing body information’ (Fletcher, 2015). support this higher executive function, it ‘share’ decision making, but the governing The ward system for the election provides for an office of the mayor with body can override a local board if a local of councillors means that they are a guaranteed operational budget. The matter is deemed to have region-wide based geographically across the whole mayor can staff this office as he or she sees policy implications or impact. A formal of Auckland. This creates a tension, fit, but all the employment agreements submission seeking to split North Rodney however, between representing their local come under the human resources controls off from Auckland Council stated that ‘we voters, on one hand, and the need to vote of the council’s chief executive. The office do not regard the present local boards in the interests of the region as a whole of mayor and its executive powers have as any more than advocates, as they have on the other. nonetheless been attacked for giving the very limited areas of empowerment’ mayor too much power, independently (Northern Action Group, 2013, p.15). Some governing body councillors of the governing body and removed This may underestimate the consultation, think regionally … but a few are still from public scrutiny. Christine Fletcher planning and place-shaping roles of very parochial and not all work well commented in 2015 that democracy is local boards, but nonetheless it reflects a with their local boards, creating a ‘lacking’, that ‘Councillors are not driving certain perception of the two-tier model. If one includes all of the elected officials on local boards and the governing body, Urban Ma-ori leaders complain that the the representation ratio in Auckland is still a relatively high 1:8,820 and growing. views of their community groups are This indicates that a significant weakness in the Auckland model may be at this still not being taken into account, and local level, in terms of representation they say that mataawaka representatives and engagement. Local board members are part-time in their roles, and not all should be appointed by urban Ma-ori ... meetings are open to the public. The claim that they lack the resources and powers to be meaningfully working with, and making decisions for, their communities situation whereby the governing body policy’, and that the public did not get will continue to be heard. councillor and local board members enough information about decisions cut across each other’s work. In affecting them (Fletcher, 2015). To Ma-ori representation theory, given their regional mandate, mitigate such concerns, the mayor’s role The government rejected the royal governing body councillors should be as first mover in policy development is commission’s recommendation to visiting and meeting with residents subject to the support of the governing have Mäori represented directly on the and local boards outside their own body, and budgeting and planning governing body through two wards, wards to get a more-regional view processes are open to the public once based on the Mäori electoral roll, plus of issues, and this does happen with they reach the governing body. Having one appointed by a Mana Whenua some councillors. (Shirley et al., the mayor elected at large is appropriate Forum. Instead, the legislation created an 2016, p.23) to the purposes of the unitary governance independent board tasked with assisting model, as it means there is a single the council in ‘promoting cultural, Moreover, this body of 21 figurehead for the whole region. Given the economic, environmental, and social representatives makes the key regulatory, scope and responsibilities of this new civic issues of significance’ for both mana budgetary and rating decisions for a leadership role, it also appropriate that a whenua and mataawaka (urban Mäori), population of 1.5 million and growing: a distinct office be resourced to support it. and ensuring that the council complies representation ratio of roughly 1:71,500. with statutory provisions that refer to Given the scope of the unitary planning Representation and participation the Treaty of Waitangi.3 The Independent process, it is simply impossible for Auckland Council has 21 local boards with Mäori Statutory Board consists of seven councillors to be ‘across the details’ in between five and nine elected members mana whenua and two mataawaka their own wards, let alone the region, each, or 149 members altogether. The representatives. They are appointed by and hence unelected officials are likely to population covered by any single local a selection body which includes one exercise greater influence. board is larger than many of the local representative from each mana whenua territorial authorities elsewhere in New group. The board then appoints up to

Page 56 – Policy Quarterly – Volume 12, Issue 4 – November 2016 two of its members to sit on each sub- of a cheaper and more efficient council’ democratic accountability over them. committee of the governing body. (Hill, 2015). No such promise was The Ports of Auckland Ltd (a company Some have criticised this arrangement made, however. The royal commission wholly owned by a CCO) has been subject on the grounds that it places unelected and others (McKinlay Douglas Limited, to public controversy, for example, due members onto committees that are 2006; Reid, 2009) were aware that, while to its management of the workforce and otherwise composed of elected councillors some efficiencies may be gained through a proposed wharf extension. The CCOs (Rudman, 2015). On the other hand, by combining services and resources, the have their own governing boards and are representing each of seven mana whenua overall costs may not be reduced due to required to act as commercial entities. This groups, this arrangement provides a past underinvestment in infrastructure opens up the risk of role conflict and poor more inclusive, yet independent, avenue and population growth. Empirical co-ordination between the business goals for local Mäori participation in decision research from Australia suggests, of a CCO, the wishes of a local community making than would have occurred under moreover, that, beyond a certain scale, and the region-wide policies and planning the royal commission’s proposal for only amalgamation of local authorities may priorities of the unitary plan. The two wards. The boundaries of such wards even lead to diseconomies (see below). Auckland model could thus be accused would cut across and/or incorporate An independent analysis of Auckland of replacing geographical fragmentation distinct rohe. But with no Mäori Council’s finances concluded that rates with functional fragmentation. wards, there is no guaranteed Mäori increases, on average, ‘are well above the In the recent past, under the ‘new representation on the governing body itself, only on its subordinate committees. Moreover, the selection body’s Experts largely agree that the unification appointments of mataawaka representa- was a good idea ... but very few tives have been controversial. One unsuccessful applicant disputed the residents hold positive opinions about selection process, and the Court of Appeal (in Te Rangi v Jackson) agreed that the the council ... process had been hasty and failed to take into account the views of mataawaka. rate of inflation, but allowance needs public management’ of the 1990s But the controversy has not ended there. to be made for Auckland’s growth and publicly-owned trading organisations Although the selection body consists the pressures this creates, as well as for such as state-owned enterprises and only of mana whenua representatives, it addressing the infrastructure deficit’, and CCOs were required to act like business appoints the mataawaka representatives. that ‘debt appears to be within prudent enterprises, although some social Urban Mäori leaders complain that the limits, although compared to other responsibilities may be mandated as views of their community groups are councils it is high and growing’ (Shirley well. Commercially-oriented business still not being taken into account, and et al., 2016, pp.40, 69). In June 2016 decisions were at arm’s length from the they say that mataawaka representatives the council group’s total tax-supported political process, and hence subject to should be appointed by urban Mäori debt was reported to be at 246.5% of its less ‘interference’. A minister or a council (Radio New Zealand, 2016). That would adjusted operating revenue, and it aims might instead purchase services from require amending the statute. to keep this under 270%. Auckland has them. For Auckland’s CCOs, however, the Direct representation by indigenous large capital expenditure requirements pendulum is now swinging back towards people in governance over their to upgrade existing infrastructure, due centralised control and democratic traditional territories is consistent with to increased population densities and the oversight. The Governance Manual the Treaty of Waitangi and necessary need to modernise, and also has to provide for Substantive CCOs (issued by the for heritage and development purposes; new infrastructure as urban development Auckland Council’s CCO governance and hence some form of guaranteed expands. Hence some difficult decisions monitoring committee in August 2015) representation for Mäori – and not have to be made about financing this in requires them to act in the best interests only through ‘mainstream’ systems – is future, through debt, rates, user charges, of ‘the council group’ and to make warranted. Mäori wards could still be public–private partnerships and/or asset decisions that align with the council’s implemented in Auckland, but they are sales. plans and policies. Agency theory and politically contentious (Edwards, 2016). the autonomy to act as a commercial The current independent board is a Council-controlled organisations (CCOs) entity have given way to ‘partnership’ and compromise that has caused controversy The CCO model has also been a closer co-ordination of activities between among Mäori and non-Mäori. controversial aspect of Auckland council entities. governance. Given the sheer size of the Financial situation assets and costs, especially in Auckland Too big to last? Some observers assume that the unitary Transport and Watercare, there have been Experts largely agree that the unification model was set up with ‘alluring promises claims that there should be more direct was a good idea (Chen, 2014; Shirley et al.,

Policy Quarterly – Volume 12, Issue 4 – November 2016 – Page 57 Auckland Council: is it too big to last?

2016), but very few residents hold positive number of councils from 157 to 73 and Victorian councils between 161000 and opinions about the council (Auckland the number of elected representatives 174000 residents’ (Drew, Dollery and Council, 2016). Even some councillors from 1,250 to 526. But a before-and- Kortt, 2016, p.74). are sceptical. Mike Lee (Waitematä and after analysis ‘cast doubt on whether Given that Auckland’s average rates Gulf ward) expressed qualified support the Queensland forced amalgamation increases have been well above inflation for a ‘greater level of self-government’ program has improved the operational and that there is significant public for North Rodney on the grounds that efficiency of local councils’ (Drew, Kortt dissatisfaction with the council, the results the unitary Auckland Council ‘cannot be and Dollery, 2016, p.12). As a result of of this Australian research reinforce the defended as optimal in terms of efficiency the amalgamations, this study found, contention that the Auckland model is and cost-effectiveness’ (Lee, 2016, p.26). a greater proportion of Queensland well beyond the optimum size from the The council has work to do to build the residents were represented by local viewpoint of both efficiency and public satisfaction. Auckland is now the largest local authority in Australasia in terms Auckland is now the largest local of population, and the comparative evidence cited above does not support authority in Australasia ... and the the notion that its size will lead to greater efficiency and economy of scale, or to comparative evidence ... does not greater public satisfaction. support the notion that its size will lead Conclusion to greater efficiency and economy of Is Auckland Council now simply too big to be efficient, democratic and sustainable? scale ... Will it be branded ‘a failed experiment’? Once the unitary spatial plan has been approved and put in place, will the next step be to devolve powers to, say, ten or 12 reputation of the unitary model among authorities that exhibited diseconomies smaller councils? its own elected members and Aucklanders of scale. The optimal population size Empirical evidence and public at large. Even if disaffected communities was found to be just under 100,000. In sentiment weigh against Auckland’s in North Rodney and Waiheke Island do addition, Sinnewe, Kortt and Dollery unified governance model. Aucklanders not win their case to break away from (2016) conducted a comparison of the disapprove of it; the rest of New Zealand Auckland Council, the fact that they have very large Brisbane City Council with refuses to emulate it. This particular put formal proposals forward to do so Sydney City Council, an average of six pendulum may have further to swing shows that many residents see the council south-east Queensland councils and an towards centralisation (meaning central as too big and too remote for effective average of ten metropolitan New South government takes over some powers to local democracy. If this trend were taken Wales councils on measures of financial shape Auckland), or it may have reached to its logical conclusion, however, more performance. If the notion that ‘bigger its extreme position and be on the cusp powers would be devolved to all local is better’ holds true, then Brisbane (with of swinging back towards a devolved boards, and eventually Auckland would 380,800 households) should out-perform model (multiple boroughs under a have 21 boroughs and a regional council, those comparators. But, on measures regional council). In the meantime, the and be back at square one. of financial flexibility, liquidity and council has to earn a better reputation On the other hand, an argument in debt-servicing ability, the Brisbane City with the people of Auckland, improve favour of the unitary council is based Council performed comparatively poorly. local engagement and participation, on its sheer size. It may create greater On non-financial performance indicators implement the new unitary plan and buying power with suppliers, reduce too the evidence does not look good for ensure financial sustainability. Its long- duplication, allow for efficient sharing of larger municipalities. Using data from term fate rests in the balance. services, and provide scope for trialling community satisfaction surveys of local 1 At the time of writing, legal appeals threaten to delay the full innovative service models. Empirical councils in the state of Victoria, Drew, application of the unitary plan’s zoning maps. evidence from Australia, if comparable, Dollery and Kort found, for metropolitan 2 The Report of the Royal Commission on Auckland Governance (2009) and related papers have been archived suggests that Auckland Council could be councils, an inverted U-shaped by the National Library at http://ndhadeliver.natlib.govt.nz/ ArcAggregator/arcView/frameView/IE1055203/http://www. well above the optimal size, however. The relationship between population size and royalcommission.govt.nz/. forced amalgamations of local bodies community satisfaction. These results 3 Local Government (Auckland Council) Act 2009, s81. in Queensland in 2007 reduced the suggest ‘an optimal population size for

Page 58 – Policy Quarterly – Volume 12, Issue 4 – November 2016 References Auckland Council (2016) Measuring Auckland Council’s Trust McKinlay Douglas Limited (2006) Local Government Structure and and Reputation: baseline results summary – June 2016, Efficiency, Wellington: Local Government New Zealand http://www.aucklandcouncil.govt.nz/EN/AboutCouncil/ Northern Action Group (2013) A Proposal to Form a North Rodney HowCouncilWorks/PerformanceAndTransparency/Documents/ Unitary Council, Auckland: Northern Action Group citizeninsightsmonitorbaselinesummaryjune2016.pdf Radio New Zealand (2016) ‘Auckland iwi block urban leaders’ bid for Blakely, R. (2015) ‘The planning framework for Auckland “Super City”: city council role’, Morning Report, 1 September, retrieved from an insider’s view’, Policy Quarterly, 11 (4), pp.3-14 http://www.radionz.co.nz/national/programmes/morningreport/ Chen, M. (2014) Transforming Auckland: the creation of Auckland audio/201814426/auckland-iwi-block-urban-leaders’-bid-for-city- Council, Wellington: LexisNexis NZ council-role Drew, J., B. Dollery and M.A. Kortt (2016) ‘Can’t get no satisfaction? Reid, M. (2009) ‘The Auckland debate: is big city governance always this The association between community satisfaction and population size difficult?’, Policy Quarterly, 9 (2), pp.39-44 for Victoria’, Australian Journal of Public Administration, 75 (1), Rose, C. (2015) ‘Living on the edge: rural views of the supercity’, pp.65-77 Briefing Papers, http://briefingpapers.co.nz/2015/11/living-on-the- Drew, J., M.A. Kortt and B. Dollery (2016) ‘Did the big stick work? An edge-rural-views-of-the-supercity/ empirical assessment of scale economies and the Queensland forced Rudman, B. (2015) ‘Maori board hops over the law’, New Zealand amalgamation program’, Local Government Studies, 42 (1), pp.1-14 Herald, 6 November, retrieved from http://www.nzherald.co.nz/local- Edwards, B. (2016) ‘Political roundup: bringing ethnic minorities to the government/news/article.cfm?c_id=250andobjectid=11540747 table’, 9 September, retrieved from http://www.nzherald.co.nz/politics/ Shirley, I., J. Molineaux, D. Shand, N. Jackson, G. Duncan and N. news/article.cfm?c_id=280andobjectid=11706780 Lewis (2016) The Governance of Auckland: 5 years on: a report Fletcher, C. (2015). ‘Phil, can you save our lovely city?’, New Zealand commissioned by the Committee for Auckland, Auckland: Policy Herald, 15 October 15, p.A25, retrieved from http://m.nzherald. Observatory, Auckland University of Technology co.nz/opinion/news/article.cfm?c_id=466andobjectid=11529204 Sinnewe, E., M.A. Kortt and B. Dollery (2016) ‘Is biggest best? A Hill, M. (2015) ‘Poll: what Auckland wants, what NZ needs’, 14 comparative analysis of the financial viability of the Brisbane City November, retrieved 14 June 2016 from http://www.stuff.co.nz/ Council’, Australian Journal of Public Administration, 75 (1), pp.39- auckland/74018816/Poll-What-Auckland-wants-what-NZ-needs 52 Lee, M. (2016) ‘Rodney escape bid could help rest of Auckland’, Statistics New Zealand (2015) ‘Subnational population projections: Ponsonby News, 1 July, p.26 2013(base)–2043’, 19 February, retrieved 8 December 2015 from Makhlouf, G. (2016) ‘The importance of being Auckland: strengths, http://www.stats.govt.nz/browse_for_stats/population/estimates_and_ challenges, and the impact on New Zealand’, speech delivered projections/SubnationalPopulationProjections_HOTP2013base.aspx at the Committee for Auckland Advisory Group summit, 21 June, Wellington: Treasury Improving Intergenerational Governance Forthcoming Event in March 2017

As part of the University’s Speakers will include: focus on the theme Peter Hughes; State Services Commissioner; of Advancing Better Sir Geoffrey Palmer QC, Professor Jonathan Boston, Government, the Institute Dr Andrew Colman. More information will for Governance and Policy Professor Girol Karacaoglu, be made available soon Studies is organising a Professor Wendy Larner, through one-day symposium at Associate Professor Michael Macaulay and www.igps.victoria.ac.nz Parliament in March 2017 on Associate Professor Maryan Van Den Belt. Improving Intergenerational Governance.

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