The Government is pushing for Councils to consider merging. It wants Councils to be more efficient and rate increases to be lower. It also wants better regional planning and less bureaucracy.
Cost-of-living pressures are a key driver for reform. Council rates have for years disproportionately increased costs for New Zealanders.
Westpac recently published its analysis of consumer prices in NZ over the past 24 years. Average household costs are up 83% since 2002. Communications were down 31% and vehicles down 2%, clothing had increased 8%, furnishings 17%, food 85%, rents 88%, insurance 150% and household energy 173%. Council rates and services increased 300%.
There are few options for Councils to reduce rate rises that don’t involve cutting services or neglecting the upkeep of core infrastructure. The real gains are to be made in Councils becoming more efficient.
I see duplication and inefficiency every week in my work as Mayor as a consequence of having two Councils in the Nelson-Tasman region. We share many services, but the extra staff structures and committees add bureaucracy and cost.
It is not that big is necessarily better – it is that the Nelson and Tasman economies and infrastructure are so intricately linked. We share the same port, airport and state highways for our transport links. Our water, wastewater, river systems and waste services are connected. We share so many parks and community facilities. Planning for housing and industry needs to be developed hand in hand. We need to rise above the parochialism of Nelson vs Tasman and recognise we are stronger together.
Some doubt the efficiency gains of a single Council. The merger last year of Network Tasman and Nelson Electricity has delivered significant savings. An independent report on merging in 2012 quantified the potential savings as between 5.5% and 6.1% in Council operating and capital expenditure. That’s a benefit of many millions every year in the context of the combined annual spend of $350 million.
Our Council is planning to have a workshop to discuss options and our response to the Government’s push for mergers. These tough economic times require we have the difficult discussions on how we can deliver better value for money for ratepayers.
