Most farmers, including our members, are unhappy with the amount of rates they pay.

 

Successive governments have stated that rates are payment for services and therefore attract Goods and Services Tax (GST).  This fact triggers ongoing debate about the fairness of the amount of Rates paid by farmers compared to the limited services they receive. Certainly, a tax based on land values mean large landowners often pay higher rates than much larger businesses in town.  Is this fair? Of course not and it has not been for years. However, reducing the burden by arguing that local government should restrict its functions, and therefore expenditure, to the core functions of waste, water, and roads is far too simplistic to gain any political traction. 

 

Local government is a creature of statute and most its functions, and often behaviour, is based on requirements laid down by Parliament. That has not stopped some wayward Councils becoming involved is some questionable jurisdictions like setting up nuclear or GE free zones. It also does not stop them from behaving or operating poorly. However, that can also be said about central government.

 

Before we start arguing about how we should pay we need to determine what we want local government for. What problems have been identified in the current system? What are the options available to solve them? Farmers of New Zealand advocates a much more holistic approach to the issue. The Royal Commission on Auckland Governance did not adequately investigate this issue and based on overseas experience the solutions now being proposed for Auckland are unlikely to achieve the outcomes they hope for. 

 

We believe that it is not just about rubbish, roads, and rates. Local governments are elected to represent local communities and to provide services to meet community needs hopefully in an effective and efficient way. Social and economic  capital is as important as efficient delivery of local services. If you take a simplistic approach reducing functions and removing the 'local' by centralising the results may be worse than the status quo.

 

Wendell Cox, an international public policy expert based in the United States, with extensive experience in local government amalgamation, makes this comment on local government amalgamation;

 

"Regrettably the right and left are of virtually equal distatefulness on the issue. Often you will find the most vocal proponents of these policies are central city business organizations and central city leftist elites. Then, there are always the misled rightists who think that larger governments will employ fewer people per capita, not realizing that the larger the government the more personnel it needs and trade unions become even more powerful. As I like to say, the only economies of scale in government consolidation are for lobbyists. The left is better at power and governance and thus routinely takes over the reigns of power. That much power should not be available in a municipal government. Bureaucrats tend to be elitist and generally more left wing, so the advice the councillors and the mayor receives will be more to the left. Democracy is diluted. Taxes are raised from a larger base and spending goes up... not just on personnel."

 

Farmers of New Zealand's intention is to advocate a review and evaluation of models of regional and local governance in New Zealand and internationally. It should identify and develop an inventory of local government functions currently performed, examine and report on operating and capital expenditures, service quality measures and other relevant measures that may be available.

There is also a need to analyse the “Governance Review” and “Public Function Review” in relation to the specific circumstances and needs of communities. Based on this analysis and research a recommendation of the most appropriate governance option, or options, including a description of the proposed governmental units, their responsibilities and rating powers, would be made for public consideration. 

This is a big call but unless this work is undertaken serious change is unlikely to occur. Check out our local government debate in the soapbox section.

 

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