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Report: Executive Summary Part 1

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Summary of Report

1. The Royal Commission on Auckland Governance ("the Commission") was established by the Government in October 2007 to respond to growing concerns about the workability of local government arrangements in Auckland.

2. The objectives of the Commission’s inquiry, as set out in its terms of reference, were

to receive representations on, inquire into, investigate, and report on the local government arrangements (including institutions, mechanisms, and processes) that are required in the Auckland region over the foreseeable future in order to maximise, in a cost effective manner,—

(a) the current and future well-being of the region and its communities; and

(b) the region’s contribution to wider national objectives and outcomes.

3. The Commission has listened carefully and with an open mind to all it has been told. It has no doubt about what is needed to revitalise local government and to help steer Auckland towards a secure, prosperous, and sustainable future. Maintaining the status quo, or tinkering around the edges, is not the answer. Bold change is required, and that is what the Commission is recommending.

4. In doing so, the Commission has recognised that there is much in Auckland local government that works, and should be retained. There is much to be commended in the way territorial authorities deliver core services and represent their communities, and these strengths will remain at the heart of local government in Auckland. Across the board in Auckland’s councils, the Commission saw people with flair, enthusiasm, and commitment working for their communities, their city, and their region. It is the strengths in existing organisations and their people that provide the foundation for the reorganisation the Commission now proposes.

5. This summary of the Commission’s full report sets out in brief the case for change and the challenges for Auckland in becoming a leading, and well-governed, metropolitan region. It explores the changes needed in Auckland local government, and describes the key elements of the local government model proposed by the Commission. The summary concludes with an outline of the cost savings and efficiency improvements, and the proposed transitional arrangements for the Commission’s model, followed by a full list of the Commission’s recommendations.

Why Auckland matters for New Zealand

6. Throughout the inquiry process, the Commission has been concerned to ensure that its recommendations are directed not only to problem solving – identifying and addressing current inadequacies in Auckland’s governance arrangements – but also to focus beyond this on a common desired future, and the changes needed to close the gap between where Auckland is now, and where it needs to be.

7. For the future, the Commission sees Auckland as a unique city in the Pacific, one that is able to compete successfully with Melbourne, Sydney, and Brisbane for people and investment, and to achieve world-class standards in quality of life. The Commission anticipates that high liveability factors will remain Auckland’s most valued assets, as it is quality of life that differentiates Auckland from other major cities and is central to Auckland’s ability to attract and retain talented people and to deliver significant investment and prosperity to New Zealand.

8. In advancing this future, three things should be noted. First, the Commission considers it important that Auckland define itself, and its distinguishing characteristics, in relation to the rest of the world. Given Auckland’s geographic location and small size relative to many international cities, being noticed on the global stage will always be a challenge. Defining a clear, positive identity and conveying it consistently and effectively is the best way to differentiate Auckland and to compete.

9. And there can be no doubt that Auckland is in direct competition with other international cities for talent and investment. The world is becoming more urbanised and, as a consequence of globalisation, smaller and more connected. As this happens, place, and the attributes of place, matter more than ever in attracting talented and productive people and capital. The difference is that Melbourne, Sydney, Brisbane, Singapore, and others are all investing more aggressively and more effectively in their future than Auckland is to secure their position as leading cities.

10. Second, it is necessary to understand the connections between the urban challenges that Auckland faces. Environmental and social goals can no longer be seen as being in competition with economic goals, but must all be viewed as part of an integrated strategy essential to Auckland’s prosperity. The four strands of well-being identified in the Local Government Act 2002 – social, environmental, cultural, and economic well-being – are inextricably linked and highly interdependent. Outcomes in each of these domains will impact on outcomes in the others. For example, a growing economy creates employment, but it also depends upon a healthy, skilled workforce. In turn, a healthy, skilled workforce depends upon a range of factors that are boosted by a growing economy, such as stable and affordable housing, efficient and accessible transport options, a safe environment, access to health care and education, recreation opportunities, and a sense of connection. The challenge for local government is to take a systemic approach, and manage the inevitable tensions, so that balanced and positive outcomes can be achieved.

11. Third, the disconnect between Auckland and the rest of the country needs to be recognised and addressed. The Commission’s report makes the clear and unequivocal case for why Auckland matters to New Zealand. Auckland is New Zealand’s only city of scale and is New Zealand’s main gateway to the world. The region is now home to more than a third of New Zealand’s population and is forecast to have a population of two million people by 2050. Because of its scale, Auckland’s success and New Zealand’s success go hand in hand. As a large, outward-looking city, Auckland can and should contribute more to national prosperity and productivity than it does now. Commenting on current financial circumstances, the Committee for Auckland observed recently, "It is difficult to imagine how New Zealand can recover, and succeed economically, unless Auckland does".

The opportunity

12. There is opportunity for Auckland. Auckland combines many of the ingredients for social and economic success. It is well linked to other parts of the world. Aucklanders are culturally diverse and cosmopolitan. The region offers a high quality of life, a skilled labour force, and a concentration of education and research facilities. It has a specialised economy and the scale, density, and agglomeration potential (from the clustering of similar industries) for greater productivity. It has an amazing location, with two harbours and significant park reserves, offering top-class recreation and leisure activities. All this is reflected in the influential Mercer Worldwide Quality of Living Survey, which ranked Auckland fifth for liveability out of 215 cities.

13. But change is needed on a number of fronts in order to fuel growth in Auckland’s economy, to improve the health and vitality of its communities, and to ensure that the amenities necessary to attract a talented work force from around the world are in place. Messy and inefficient urban growth, infrastructure constraints, social disparity, and poor urban design are all areas highlighted by the Commission for urgent attention. Auckland needs to become much smarter about managing urban growth, and the social challenges that attend it, in order to retain high liveability and achieve sustainability for the long term. The cost of not substantially improving Auckland’s response to the challenge of urban growth will be too high for Auckland and for New Zealand.

The case for change in Auckland local governance

14. What, then, is the role of local government in effecting change, and in helping Auckland realise its potential?

15. While growth and prosperity are not created in local or central government offices, the settings provided by both, working together, are important. Lowering regulatory and delivery costs for businesses and individuals, improving infrastructure, and promoting innovation will help make Aucklanders more productive. Protecting Auckland’s natural environment and adopting measures to improve the built environment and public realm makes Auckland more attractive to residents and visitors, and better able to compete as an international city.

16. How local government is structured is important in determining what gets done – and what does not – in Auckland. Governance arrangements affect the capacity to plan and make strategic investments on an integrated, region-wide basis, and the ability to solve the larger and longer-term challenges effectively. Governance arrangements affect how much access people and communities have to the system and their ability to influence decisions about what services and initiatives they value. How local government is structured affects the cost of services and whether good value for money is delivered, the resources made available for investment, and service provision.

17. The Commission learned of many examples of what is not working in Auckland through its submission and hearing processes, and arising from its own research. After considering a wide range of practical issues, the Commission identified two broad, systemic problems evident in current Auckland local government arrangements:

18. Auckland’s regional council and seven territorial authorities lack the collective sense of purpose, constitutional ability, and momentum to address issues effectively for the overall good of Auckland. Disputes are regular among councils over urban growth and the development and sharing of key infrastructure, including roads, water and waste facilities, and cultural and sporting amenities. Councils cannot agree on, or apply, consistent standards and plans. Sharing of services among councils is limited, yet there is scope for so much more activity in this area.

19. The end result is delayed and sometimes suboptimal decisions for the region. In its funding decisions, central government has to deal with multiple parties, with Auckland councils and agencies failing to articulate clear regional priorities. Citizens and businesses get poorer services than they hope for, at a higher cost than necessary. There is waste.

20. Formal consultation by Auckland councils has become a poor proxy for true connection with their communities. Consultation and decision-making processes are prolonged and duplicative, and often fail to provide a true measure of what citizens want, and what is in their best interests. These are not necessarily the same thing, and leadership is needed to draw people into well-informed debates about choices. The result of poor engagement is poor or delayed decision making, with elected leaders and officials finding it hard to do their jobs effectively.

21. There is no lack of good intent. The Commission acknowledges the work done by Auckland’s councils over the past 18 months to advance the One Plan – a single strategic framework and action plan, which sets a clear direction for how the region plans to achieve sustainable development, with a focus on the region’s infrastructure. The first version of the One Plan was adopted by the Auckland Regional Council in October 2008. This is a positive step towards collaborative regional strategy and action. The Commission observes, however, as others have previously, that Auckland does not lack plans; it lacks the will and ability to implement them. It is the Commission’s view that the work undertaken on the One Plan needs to be put on a much sounder footing, by designing a governance model that concentrates responsibility for regional decision making in a single entity. The Commission recommends structural change to advance the priorities of the region. Otherwise there will be more plans that are not implemented and the cycle of missed opportunities will continue.

Principles for restructuring governance

22. In designing the most appropriate system of governance for Auckland, the Commission sought to be forward-looking and to produce a structure capable of meeting not just immediate needs but those of the region as it evolves over the next 20–50 years. The Commission was guided by the following four principles:

Auckland’s governance arrangements should encompass the interests of the entire Auckland city-region and foster a common regional identity and purpose, which supports integrated planning and decision making.

The governance structure should deliver maximum value within available resources, in terms of cost, quality of service delivery, local democracy and community engagement.

Roles must be clear, including where decision making should be regional and where local.

The structure should respect and accommodate diversity and be responsive to the needs and preferences of different groups and local communities.

23. It is important to acknowledge that there are inherent tensions among these principles, and that no single structure will satisfy them all perfectly. The Commission has sought a reasonable and workable balance.

Alternatives considered

24. Over 3,500 written and 550 oral submissions were made to the Commission, most proposing change of some form or another to existing local government arrangements. Suggestions were wide ranging, relating, variously, to the number and sizes of councils, mayoral powers, representation and participation arrangements, council administration, urban design, social and environmental responsibilities, and the role of council entities such as Watercare Services Ltd ("Watercare") or the Auckland Regional Transport Authority ("ARTA"). When all the combinations of views on these elements are considered, the evidence presented almost every conceivable shade of opinion for the Commission’s consideration.

25. The Commission considered a range of options, from retaining the status quo to establishing a single local authority with a two-tier structure (such as a large regional governing body or a unitary council with representation at a more local level) through to a larger number of empowered community boards or smaller ward-based councils.

26. The Commission concluded that the establishment of a single, region-wide unitary authority would help achieve strong and effective Auckland governance and overcome current fragmentation and coordination problems. It would allow for much more decisive and visible leadership. Other benefits include advantages of scale in relation to service delivery, infrastructure, investment, and coordination of logistics.

27. At the same time, the Commission was concerned not to create an organisational monolith, unconnected to the people it serves. With this in mind, the Commission considered carefully a number of variations of a two-tier model comprising a unitary authority with additional representation at a local level. The Commission concluded that having up to 20 community councils, as a number of submitters proposed, would be costly to establish and run, and disruptive to existing staff and services. The conclusion was borne out by independent financial analysis undertaken for the Commission by experts Taylor Duignan Barry.

28. After careful consideration, the Commission opted for a smaller number of local councils, based in most respects on the existing council boundaries – following the principle of building on existing institutional arrangements where possible.

Proposed model

29. The Commission proposes the dissolution of the Auckland Regional Council and all seven territorial authorities existing in Auckland, and the creation of a new single unitary authority called the Auckland Council. The structure of the Auckland Council is summarised in Figure 1 (opens 350k jpeg in a new window), and the details are elaborated below.

30. The Auckland Council will have all the powers and responsibilities of a regional council and territorial authority across the region. Staff and all assets and liabilities from existing Auckland councils will be transferred to it. The Auckland Council will hold all council assets and employ all staff. There will be one long-term council community plan, one spatial plan, one district plan, one rating system, one rates bill, one voice for Auckland.

31. The boundaries of the Auckland region will be unchanged to the north and for the Hauraki Gulf. In the south, the boundary between the Auckland and Waikato regions will be changed in two ways:

Adjustments to territorial authority boundaries are proposed to reflect the new regional boundary. The parts of Franklin District that will be outside the new Auckland region, including Onewhero and Kaiaua, will be transferred to Waikato District.

32. The boundaries of the Auckland region and areas to merge with Waikato District are shown in Figure 2 (opens 220k jpeg in new window) and Figure 3 (opens 220k jpeg in new window).

33. In addition to the elected governing body of the Auckland Council, local democracy will be maintained through six elected local councils operating within the unitary Auckland Council. Local councils will oversee the delivery of services by Auckland Council staff and will undertake local engagement in four urban and two rural districts. The boundaries of the new local councils will be centred (with some important boundary adjustments) on the existing council territories of Rodney District, North Shore, Waitakere, Auckland, and Manukau Cities, and Franklin District, thus enabling new local councils to utilise existing infrastructure and service centres.

34. The boundaries of the local councils are shown in Figure 4 (opens 200k jpeg in new window) and Figure 5 (opens 180k jpeg in new window).

35. The functions of local councils will be set out in statute, with provision for the Auckland Council to delegate further functions. While local councils will have specified governance responsibilities within their districts, they will be part of the Auckland Council, and will be subsidiary and accountable to the governing body of the Auckland Council. They will not be local authorities in the legal sense (that is, with their own power of general competence), nor will they be community boards. They will be a new type of body – a local representative body, which operates within a larger local authority and which provides services and acts as an advocate for the residents, ratepayers, and communities of their areas.

36. Generally, community boards will no longer be required in the model the Commission proposes. The Commission recommends that an exception be made for the Great Barrier and Waiheke Island Community Boards, which should be retained, with wider delegated powers. It also recommends the establishment of a community board for the central city and waterfront, with powers delegated to it from the Auckland Council. This area will not be within a local council area. The boundaries of the city centre and waterfront area are shown in Figure 6 (opens 350k jpeg in new window). This is discussed in paragraphs 52–54 below.

37. The Commission’s recommendations will achieve significant streamlining in Auckland’s local government arrangements and are intended to simplify roles, clarify mandates, and eliminate unnecessary duplication. On one hand, they will devolve local delivery and engagement to local councils. On the other, they will concentrate strategic planning and investment and the management of key resources and assets at the regional level, under the direct control of the Auckland Council. Reforms are intended to make local government in Auckland more efficient and less fragmented.

Governance of the Auckland Council

38. Auckland needs an inspirational leader, inclusive in approach and decisive in action. Auckland needs a person who is able to articulate and deliver on a shared vision, and who can speak for the region, and deliver regional priorities decisively.

39. The Auckland Council will be led by a mayor who is elected by all Aucklanders. The Mayor of Auckland will have greater executive powers than currently provided under the Local Government Act 2002, although these additional powers will still be more modest than in many international models of mayoralty. The additional powers will be limited to three key abilities:

40. The Mayor of Auckland will be expected to chart and lead an agenda for Auckland. To ensure the mayor remains fully accountable, all policy will need to be approved by the full Auckland Council. There will also be additional obligations on the mayor to engage with the people of Auckland through regular "Mayor’s Days" and an annual "State of the Region" address.

41. The Auckland Council will comprise 23 councillors, 10 of whom will be elected regionally by all Aucklanders. Eight councillors will be elected in four urban wards. Two will be elected in two rural wards. This mix of city-wide and ward-based councillors is intended to ensure that the right balance of regional and more local perspectives is brought before the council.

42. Provision has also been made for the election to the Auckland Council of two councillors by voters on the Māori electoral roll; and one councillor appointed by mana whenua through a mechanism specified by the Commission in its report.

43. The Commission considers that the provision of three safeguarded seats for Māori is consistent with the spirit and intent of the Local Government Act 2002, which requires local authorities to establish processes for Māori to contribute to decision making. It will ensure that there is an effective Māori voice at the decision-making table, and that the special status of mana whenua, and their obligations of kaitiakitanga and manākitanga, are recognised.

44. The Commission expects that the Auckland Council functions will centre on regional policy, investment, and planning; regional infrastructure and networks; and service delivery. Three particular aspects deserve mention:

45. The Auckland Council will also provide administrative services for itself and local councils for all back-office functions, including setting and collecting rates, accounting, treasury, asset management and other financial functions, human resources, payroll, and computer systems.

46. More broadly, the Auckland Council will have an important role in developing joint action and investment with business and other stakeholders and building wider regional coalitions. This role is of particular relevance in the context of infrastructure and economic development.

Next > (Executive Summary Part 2)


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