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Frontpage News - December 2018

There have been some big announcements on water, housing, tourism and wellbeing over the last month, and LGNZ are asking the hard questions on them.  Read on to find out where we stand on these topics and what the media are saying.

There have been big announcements on water, housing, tourism and wellbeing over the last month, and LGNZ are asking the hard questions .  Read on to find out where we stand on these topics and what the media are saying.

In this issue

  • Greetings from LGNZ
  • LGNZ welcomes drinking water reform, not silver bullet policy making
  • Councils see Urban Development Authority as key to fixing housing work
  • Local government releases position statement on three waters
  • Government must embrace localism to improve community wellbeing 
  • Central and local government partnership provides boost for tourist
  • RMA reform to address key concerns for local government

Local wins

Greetings from LGNZ

While we see potential in a number of government announcements on water, housing, tourism and wellbeing, however there are a number of questions that need answering:

Will the Three Waters Review shut the door on innovation and enforce chlorination?

Does the creation of an Urban Development Authority show that our government needs to relook at the RMA?

Will the tourism funding announcements handle the expected visitor boom this summer?

Is the Government going to walk the talk on wellbeing and embrace localism, or will it maintain a centralised approach to decision-making? 

We’ve recently asked the hard questions, and the answers are beginning to emerge.  This issue of Frontpage news rounds up some of those questions, and answers, from both LGNZ and a wide variety of political and media commentators. Enjoy.

LGNZ welcomes drinking water reform, not silver bullet policy making 

LGNZ has welcomed the Government’s release of a report by GHD and Boffa Miskell into the costs of upgrading wastewater treatment plants, noting that it supports the sector’s call for a targeted policy response to help small rural councils pay for hard infrastructure upgrades. 

Local Government Minister Nanaia Mahuta recently released a Three Waters Review cabinet paper which looks to reshape the drinking water regulations and explore different water service delivery options.

LGNZ President Dave Cull has welcomed the initial focus of the Three Waters Review paper, saying it provides a pathway to better drinking water regulation, but noted that further discussion is needed around the service delivery options.

“The prioritisation of drinking water as the first target of reform is welcomed by the sector.  We’ve long said that we need to focus on drinking water first, as that is where the biggest issue is, and that we need to get the regulation right,” says Mr Cull.

The paper also proposes that the Minister of Local Government report back in late 2019 with detailed policy proposals for service delivery arrangements, following further analysis and engagement on the following high-level options, one of which is mandatory aggregation. LGNZ opposes mandatory aggregation, as set out in the Three Waters Position Statement released last week.

“Although New Zealand is small, we’re a highly diverse country, and we need tailored policy making to tackle the array of challenges our communities face.  Mandatory aggregation is one-size-fits-all policy making that doesn’t recognise this diversity,” says Mr Cull.

“To be crystal clear, we don’t oppose aggregation. We accept change is needed – our 20th century service delivery model cannot cope with current and future population and land use pressures.  However we need to look at all the options available, rather than looking for a silver bullet fix.”

“Water provision is extremely complicated, and as the owners of the three waters assets, it’s vital that central government engage and utilise our knowledge to make sure that any decisions are affordable and will have a tangible, positive impact on water quality.”

The first tranche of work, due June 2019, will also look at the role of regional councils’ in enforcement of environmental regulation.

“Regional councils are currently undertaking work to enable national reporting on compliance, monitoring and enforcement, and we want to be involved in any discussions about moves to shift the boundaries of regional councils’ responsibilities.” 

“We look forward to continuing to work with the government on the Three Waters Review, and utilising our extensive, data-led evidence base to inform policy developments.”

Councils see Urban Development Authority as key to fixing housing woes

LGNZ welcomes the establishment of the Housing and Urban Development Authority, noting that housing affordability is a wicked problem for New Zealand that can only be tackled through a partnership between central and local government.

Under the framework launched today, the new Urban Development Authority will seek to partner with local councils to deliver infrastructure and housing projects that have proven too difficult to get off the ground under the previous regulatory settings.

“This is a huge opportunity to massively increase the supply of housing in our fastest growing cities, that was not previously possible because of the regulatory logjam created by our planning laws.  Local government has worked closely with the minister on this package of reforms, to ensure that we can kickstart development in a way that works best for our communities,” says LGNZ President Dave Cull.

The Authority will have a special focus on the development of ‘brownfields’ areas, being land previously used for other purposes, that may have difficult, poor quality, aging or at-capacity infrastructure, making it difficult to develop.

“The Urban Development Authority is the thin edge of the wedge, and goes some way to fixing the regulatory issues with New Zealand’s convoluted planning system”

“We look forward to working with the minister on the next phase of reforms, to ensure that we free up the supply of housing across the country, not just in Auckland and other fast growing areas.”

Tackling homelessness and unaffordable housing will also be under the Authority’s remit, areas that local government currently play a significant role.

“Councils deliver social and community housing to thousands of New Zealanders.  As the Government’s state landlord, the Authority will be a partner in helping to link our housing initiatives with the resources available from central government.” 

“Councils hold key relationships with iwi and Māori, businesses and contractors, and have deep experience within our regions.  We’re looking forward to partnering with the Authority to share our knowledge and relationships to drive urban renewal in our communities.”

Local government releases position statement on three waters

LGNZ released its position statement on three waters at its most recent Quarterly Media Briefing, calling on the Government to adopt four good public policy principles ahead of any reforms to the three waters sector.

Local government believes the principles will be key to achieving the balance between providing New Zealand’s communities with high quality water infrastructure and services that are affordable in the long-term.

Central government is expected to provide high-level direction on its reform work programme later this month. Indicatively the first recommendations from this work programme are expected in mid-2019.

“Local authorities have decades long experience operating and maintaining the country’s three waters infrastructure. We’re also responsible to our communities for the costs of providing this infrastructure.  This gives us a unique perspective on how to proceed with reforming the regulations that govern the three waters space,” says LGNZ President Dave Cull.

“That’s why we’re launching this position paper. We understand the public’s urgency to see water standards tightened up after the Havelock North contamination incident. But we also recognise that making regulatory decisions in a hurry can produce unforeseen and costly consequences down the road.”

“The four principles that we’re launching today tap our experience in the three water sector, and would provide an essential framework on which to build a robust regulatory structure to ensure we continue to deliver high quality water services.”

Local government’s four principles:

Fix drinking water first: Havelock North has shown urgent action is needed in the drinking water space, and any reform process should make this a priority. The Government needs to set hard drinking water standards, and establish a strong regulator to police these standards

Let existing regulations run their course: Wastewater and stormwater assets are long-lived, and it takes many years of planning and investment to change performance outcomes. New freshwater quality standards were introduced in 2017, and we should allow efforts to meet these standards to run their course before introducing new requirements.

Take mandatory aggregation off the table: Local government strongly opposes mandatory aggregation of water assets as one-size-fits-all policy making. The economic literature shows aggregation can be an effective tool to produce service delivery efficiencies in some cases, and so needs to be applied on a case-by-case basis, not as a blanket policy for New Zealand.

Incentives matter: Central government should focus on getting the incentives right to drive behaviour. Setting hard quality across all three waters, backed by rigorous compliance enforcement, will force service providers to lift their performance. At the same time it will open the door to innovation, as service providers experiment with different technologies and ownership models to meet these standards.

Mr Cull noted that while there are challenges at the margin, by and large New Zealand’s water system is far from broken.  He underscored the sector’s willingness to work with Government to put the appropriate reforms in place.

“As a sector, local government accepts that change is coming to the way we provide water services to our communities. Our 20th century service delivery model cannot cope with current and future population and land use change pressures,” said Mr Cull.

“We’re open to embracing this change with central government by collaboratively working on a range of policy options to deliver the quality of water, be it waste, storm or drinking, that our communities deserve. What we don’t want is a policy fix that fails to recognise the reality that New Zealand is made up of a multiplicity of diverse communities.” 

The principles stem from LGNZ’s extensive work on three waters and freshwater policy, through the 3 waters project and more recently, Water 2050.

Read the full Local government position statement on water here.

Read the 3 waters issues paper here.

Government must embrace localism to improve community wellbeing

Local Government New Zealand is pleased the Government is starting a discussion to reinvigorate local decision making, but says a bold localist approach is needed to drive meaningful change.

The Local Governance for Community Wellbeing Cabinet paper looks to re-introduce social, environmental, economic and cultural wellbeings back into the Local Government Act 2002, which was removed by the previous Government in favour of a more infrastructure-focussed purpose statement.

“Local government has a huge role to play in the intergenerational wellbeing of New Zealanders,” says LGNZ President Dave Cull.

“It’s the form of government closest to the people, and is arguably in the best position to lead a grassroots drive to strengthen our democracy, protect and enhance the environment, sustain regional growth and instill greater trust and confidence in local governance.”

“However it requires a bold, localist approach to achieve better outcomes in these areas.”

“It’s internationally recognised that having decisions made by the level of government closest to those that they affect has huge economic and social benefits.”

Evidence shows fiscal decentralisation leads to higher standards of living and greater democratic participation.  However, New Zealand, with 88 per cent of public expenditure made by central government, is significantly more centralised than the United States (54 per cent), Denmark (31 per cent), and Germany (19 per cent).  Central government’s share of public expenditure is also much higher than the OECD average (46 per cent).

Shifting more decision-making to the local level means that local citizens, iwi/Māori organisations, businesses and community groups will have greater ability to influence the design of local services to address the issues that matter most.

“We’re pleased the Minister of Local Government Nanaia Mahuta has initiated this dialogue on governance responsibilities and where they should sit.  It’s important that the hard questions are asked around performance, not just from both local but also from central government.  Improving outcomes for our communities means both spheres of government must focus on what they are best at doing.”

The wellbeing paper, which seeks Cabinet support for a prospective work programme to be undertaken by DIA into the roles and responsibilities of local government, sits apart from the Productivity Commission’s Inquiry into Local Government Funding. 

“It raises some concerns that the funding review of local government sits in isolation to the wellbeing paper, which is considering roles and responsibilities.  It will be difficult to come to definitive solutions in one area without considering the other, and we expect there to be more conversation on how this will be resolved.”

Central and local government partnership provides boost for tourism

A collaboration between central and local government on a review of the Tourism Infrastructure Fund, with nine changes announced, will assist small communities struggling with the volume of tourists and lead to better experiences for travellers, says LGNZ President Dave Cull.

“As we saw last year, there was a significant gap between the increased number of travellers and the infrastructure our regions were able to provide to meet that influx.”

“Minister of Tourism Kelvin Davis has listened to local government concerns, particularly around eligibility criteria, coverage of operating costs and funding of feasibility studies, and invited local government to collaborate on solutions, which have been developed quickly and effectively.”

The Tourism Infrastructure Fund provides $100 million over four years for the development of tourism-related infrastructure such as carparks, freedom camping facilities, sewerage and water works and transport projects.

“Credit must go to the minister for championing a ground-up policy development process that had strong local government engagement, to ensure the fund is fit-for-purpose, particularly for the councils and communities who use it.”

The review is just one of several initiatives to strengthen the tourism capability of the regions ahead of the peak summer season, says Rotorua Lakes District Mayor and Responsible Camping Working Group Chair Steve Chadwick.

“Many small towns and ratepayers bases are hosting huge numbers of tourists.  The fund review, as well as the Responsible Camping Working Group, the Tiaki Promise initiative and tourism strategy are a step in the right direction to ensure we’re prepared for a fantastic summer.”

LGNZ have campaigned for a sustainable package of tourism infrastructure funding, including a Local Tourist Levy, but also see the government’s International Visitor Conservation and Tourism Levy as a positive step, as it recognises that tourists should contribute to the costs of the infrastructure they use. 

“There’s no silver bullet – we need collaboration between local and central government and the private sector to ensure that the social licence and manaakitanga provided by our communities continues,” continued Mrs Chadwick.

RMA reform to address key concerns for local government

LGNZ supports the Government’s proposal to wind back a number of Resource Management Act changes that excluded public consultation requirements, a move councils strongly opposed when they were introduced in 2017.

The changes, outlined in a recent cabinet paper, would reduce the complexity of the Act, remove regulation making powers and override provisions, restore public participation provisions and financial contributions.

“Local government raised a red flag around the RMA changes in 2017, knowing they would threaten the public’s ability to have a say, create problems for infrastructure providers and hinder councils’ ability to give effect to updated standards without needing to go through long and cumbersome processes,” says LGNZ President Dave Cull.

Change to the broad regulation-making powers that enabled the Minister for the Environment to override councils has also been proposed, who will still retain some national direction powers via National Environmental Standards and National Policy Statements.

“Local government supports a collaborative approach with the Ministry for the Environment, through clear communication and engagement. The 2017 changes were a ham-fisted way to try and achieve this, and we’re pleased to see that the government has faith in a more effective process.” 

“LGNZ will be working with the government on this reform package to ensure they can be easily implemented. We are also keen to work on the signalled changes to the role of the EPA in enforcement activities, as we are not convinced they are the best way to achieve the outcomes sought.”

In the news: