Give our community a chance to consider self-governance

Waiheke has been chafing under Auckland based council management since we lost a local council in1989.  A scan of our local papers over the intervening years will provide ample proof of the many occasions we have protested planning and other decisions made ‘offshore’. After Waiheke developed an award winning District Plan in the 1980’s, it annoyed the community gravely when most of the plan’s submissions to influence the development of the current HGI District Plan were ignored.

Despite now having three times the 1980’s population and a significant economy that has grown faster than Auckland’s since 2000 [I.e. no thanks to ATEED], our residents and ratepayers continue to assert the environmental and community values that give rise to concerns about control over local planning and operations from Auckland.  As evidence of this, the community recently reaffirmed the “Essentially Waiheke” community strategy. This strategy will, among other things, ensure that our community will not want the high cost infrastructure, particularly in respect of ‘3 waters’ infrastructure, that some councils now struggle with.

Our community is more deeply involved in local government than is the norm for most councils in NZ – typically about 60% vote in local government elections.  Many locals actively engage with the Local Board on a wide range of issues and they volunteer in many environmental and community projects.

Our community has shown itself to be creative and entrepreneurial. It is keen to unleash its energy, creativity and commitment to our environment by using the increasing range of technologies available to tackle energy generation, innovative transport solutions, waste and stormwater management, pest control and so on.  Please release our community from offshore shackles to innovation and self-reliance.

There is now a significant number of highly paid commuters traveling to [mostly CBD] Auckland – offset by almost as large a number of workers commuting to Waiheke.  They add resilience to our economic base and mitigate an earlier reliance on seasonal tourism.

There is a larger number of high value rating units than is usual for rural councils to sustain local government finances. The Morrison Low report confirms the fact that Waiheke generates more council revenue than any other council in NZ with a comparable population.

While we accept the view that councils are very different and hard to compare financially for a number of reasons, the fact remains that most of the 23 ‘rural’ councils in NZ gather less, or far less, revenue than Waiheke while having considerably larger territories, with significant [and usually shared] water catchments, far more kilometers of roading, bridges footpaths, stormwater pipes etc.  Most have swimming pools [even Kaikoura with only 3,700 residents has a pool], recreation centres and so on. Pro rata Waiheke may have more acres of reserves and walkway but in every other respect we have little infrastructure and facilities.

We remind the Commission that we supplied a ‘straw man’ budget in our application. Morrison Low made no reference to it in their report.  While we accept that it was not as well informed without access to dis-aggregated AC financial information, we nevertheless think it deserves consideration in the peer review being done of the ML report. We also offer herewith another attempt at a budget done on the basis of information supplied to the Local Board in 2016. Again it is not definitive but it highlights areas of potential savings we believe would be possible under greater local control.

We request an opportunity to discuss the treatment of the potential for savings – and hence the possibility of Waiheke being a “reasonably practicable option” with the LGC and the people doing the peer review. 

We also ask the LGC to note the very significant compound 3.5% increase in rates planned by the AC to meet the massive infrastructure needs of a community that aspires to grow in a way that we do not. It is not fair that Waiheke’s ratepayers should have to meet these planned expenditures on the grounds that we may occasionally use them. To repeat, there are NO plans for new capital expenditure on Waiheke in the LTP.

We have noted that Aucklanders use our facilities at least as much as we use theirs and while we accept this seems a little “tit for tat”, the bottom line is we have to pay for our own water and manage waste water, walk under few street lights on poor roads and do so without the benefit of well formed footpaths. We pay full whack for our ferry service – a not inconsequential cost for those, other than commuters, who wish to avail ourselves of Auckland’s facilities. Most of our halls are not council owned, of necessity we organise our own civil defense system etc etc.

Finally, we have provided a copy of a recent report on Local Board finances prepared for the Political Working Party into the AC’s “Governance Framework Review’. We could not be more eloquent about how difficult it will be to meaningfully give Waiheke sufficient autonomy from the “AC family of organisations” to satisfy our community’s aspirations.  Better local governance and full accountability, as envisaged under the LG Act, will be achieved for Waiheke only if it is given control over its own local government.

Further response to Morrison Low report – 8 September 2017

Our Waiheke believes that any peer review of the ML report will be a waste of taxpayers’ money if it restricts itself to the source of information relied upon by ML.  Without a wider view, including the scope for efficiencies and indicative comparisons with rural councils we reject the report as a basis for the LGC to decide on Reasonably Practicable Options for a Waiheke Unitary Council or a Waiheke District Council.

We have studied the RFP to which Morrison Low responded in gaining this contract and can find only section 7.5 as a possible reason for them restricting their analysis to current data from the AC.

7.5       Analysis of the long-list options will involve accessing and analysing information from the relevant council plans (i.e. annual, long-term, asset management), strategies (i.e. financial, infrastructure), policies (i.e. funding, revenue, rates) and any other relevant information including relevant councils and council controlled organisations.

The inclusion of “Any other relevant information” would seem to provide for a wider scope than was used and certainly should have ensured reference to the applications and submissions made to the LGC in connection with this issue. OW included an estimated budget for a Waiheke Unitary Council – some analysis of that would have been welcome.

We trust that the LGC has not itself put limitations on the scope given to ML to source data for their “analysis”.

Potential for conflict of interest

Given the way this report has treated reasoned and factual material supplied by Our Waiheke and the Northern Action Group in their applications and subsequently – material that is not referenced at all in the ML report – we find ourselves highly sceptical about the company’s motivation in coming to its conclusions. The dismissive way it makes reference to the capabilities of smaller councils, for example, is quite unproven and runs counter to studies done on their efficacy.  [See for e.g. “The small size of the council’s staff would mean that there is limited scope for advanced strategic planning and policy development, with increased dependence on contracted external expertise.”]

ML does a lot of work for the Auckland Council [AC].  Their report states that

“we are familiar with the current challenges and opportunities for Auckland Council, through a number of significant recent projects for Auckland Council, including in the areas of governance, delivery and council-controlled organisations.” [p.3]

Close involvement with the AC begs serious questions about the potential for a conflict of interest and a strong possibility that ML staff could readily be influenced in their assessment of the RPOs by the understandable negative position of AC management to the possibility of a breakaway council.

We now address selected text from the ML report

Executive summary

P. ii

“To assess the Options, we created a one year and a forecast ten year financial model, based on an apportionment of Auckland Council financial information to the affected areas”

OW strongly challenges this approach. It should have been just one input into an assessment of the RPOs.  it is precisely because we challenge the high costs and complexity of a massive bureaucracy, and the high costs of interest for debt and depreciation accruing to infrastructure Waiheke doesn’t share with the mainland, that we applied to break away. Benchmarking against at least some of the 23 ‘rural’ councils in NZ should have been a significant part of any analysis if any note had been taken of reasons and data provided at length in our submissions.

“We then assessed the likely capability and capacity of each of the potential local authorities to efficiently perform its role as defined in the Act.”

There is precious little ability in the report to judge how ML have gone about making this assessment other than with reference to the AC’s finances.

“For the Options involving a change to regional boundaries, we assessed the ability for the authority to enable catchment-based flooding and water management issues to be dealt with effectively.

Waiheke has a small number of water catchments with run off amounting to little more than small creeks.  The only creek to cause concern in recent times [Little Oneroa] has been the subject of intense work by the Local Board and local volunteer organisations in the absence of any attention by both the ACC and the AC over many years. We cited this creek in our application as an example of how difficult it is for the many functional sections of the AC and AT to coordinate their services to provide a solution to a small problem.

Flooding in 2017 has highlighted how little provision and planning for stormwater has been made during the 28 years of jurisdiction under the ACC and the AC.  It is clear to many affected islanders that poor resource consent decisions by planners managed off island and by AT has exacerbated the situation. This problem has been acknowledged by AC / AT management recently. It is clear that closer to the problem / local decision-making is much more likely to do a better job in this regard.

More generally in respect of regional council functions, it is not at all clear from MLs figures how they came to the big differences in revenue and expenditure as between Option 5 [UC] and Option 7 [DC].  Without the figures to determine how the difference was determined we have to assume that pro rated application of AC figures for regional functions are the culprit.

OW on the other hand has repeatedly submitted that Waiheke would have few of these regional costs given the nature of our territory. Most regional issues / functions would have to be dealt with separately from those on the mainland and would therefore be most efficiently dealt with by a local council.  We note that islands other than Waiheke in our proposed UC area are either DOC managed and/or have no water management and few other issues to be dealt with apart from pest control.

P. iii

“Option 5 – Waiheke Unitary Authority. This Option results in a year one estimated $6.4 million deficit. Rates would need to increase by 43% in year one to cover the deficit.”

The baldness of this assertion is, frankly, breathtaking. Apart from the arrogance of assuming that rates would be the only option open to a new council to manage revenue to meet any shortfall, it doesn’t even contemplate the possibility of allowing for lower costs or changes in service levels being decided by a new council.

Expenditure on a major expenditure item – say parks and reserves for example – could be cut if need be and, in any case, we believe major efficiencies are quite possible.  Efficiencies in roading are crying out to be made [Rumour has it that Downers is not likely to retain its contract for the island as its costs and appalling quality of work are now crystal clear to all.] OW has also rejected the notion of retaining service levels since they were determined from a point of isolation on the mainland and were intentionally “harmonised” since the days of the Transition Authority.

In addition there are likely to be significant capability and capacity issues for a unitary authority that has approximately one fifth the population of the smallest current unitary authority in New Zealand6.

Presumably the Chatham Islands UC is hopeless in this regard then. Apart from the completely unproven assumption made here, we ask that the LGC note what we said above in respect of regional council functions. Waiheke wouldn’t be working in a vacuum – there are plenty of role models and technical advice available in local government circles to call on and we have an amazing array of highly qualified residents on island [including current senior AC technical staff] who already volunteer their know how to the Local Board on a wide range of fronts. The relative simplicity, clear boundaries and small scale of our proposed council area make it entirely possible for us to manage ourselves in this regard.

Option 7 – Waiheke District Council. This Option results in a year one estimated $4.7 million deficit, which is forecast to increase over the ten year forecast period. Rates would need to increase by 36% in year one to cover this deficit.

See comments for Option 5 above.  Note that ten year population and planning extrapolations for Auckland and Waiheke are comparing chalk and cheese. Waiheke has no aspirations to grow like Auckland.  It can only accommodate many more residents if both our District Plan and the recently overwhelmingly reaffirmed “Essentially Waiheke” community strategy are put aside in favour of an Auckland “growth is good” planning approach. Our community’s desire to act as kaitiaki for Waiheke to maintain its character for the benefit of Aucklanders and NZ includes ensuring that any growth or development is in keeping with the island’s environmental and community values.

We also repeat, there are NO new capital expenditure plans for Waiheke in the LTP so simple pro rata assignment of finances in respect of capital will be minimal and renewals only.

1. v

Disbenefits

There would be an increase in Auckland Council’s operating and capital costs.

If Waiheke costs the AC some $4.7 [DC] to $6.4m [UC] p.a. more than it receives in revenue, setting aside transition costs, then how is it possible that there would be an increase in the AC’s operating costs if Waiheke was separated off? Surely, separation should reduce the AC’s costs as they are now measured?

1. 1

1.2.1 Part I – Longlist assessment

“The legislative criteria require the LGC to be satisfied that any local authority proposed to be established or changed under an RPO will:

1. a) “have the resources necessary to enable it to carry out effectively its responsibilities, duties and powers”

If ML ‘s simplistic extrapolation of the AC’s finances is to be believed then Waiheke’s current total revenue is much higher than any of the 16 rural councils in NZ with less than 13,000 people. [With a third of our dwellings being holiday homes now frequently in use, we believe our current 9250 residents equate to 13,000 in other rural councils. Our 6500+ rating units and our rates take are significantly larger than for those 16 councils.]

Meanwhile, as we have been at pains to explain repeatedly, Waiheke has a much smaller territory, far fewer facilities, less infrastructure etc than those councils while services provided are no more than normal.

The “elephants in the expenditure room” are roading / transport subsidies and the enormous provision for interest and depreciation the AC has to make for its massive debt and infrastructure assets.  AC management makes much of having contained and even reduced operational expenditure per ratepayer since amalgamation but that can’t be true for Waiheke given the very high claimed AC expenditures on Waiheke outlined in the ML report.

Roading costs are suspiciously high on Waiheke.  Even making a massive allowance for Waiheke being an island with difficult terrain, it simply defies belief that efficiencies could not be made.  The standard of work can only be described as appalling.  The contract needs much closer local scrutiny. In any case, the quantum of roading and related works are a discretionary item that a local council could vary to fit into its financial capabilities.

[NOTE – Now having access to AT financial data for all transport services we are quite confused by some of the numbers provided.  It is not at all clear what is spent on subsidies for public transport vis a vis roading opex.  Renewals capex for 2015/16 are shown as $4.94m but maintenance expenditure we have seen has shown expenditure on road maintenance in excess of $10m in the last 2 years. Opex for “Transport Services” [$2.25m] and “AT Metro” [$3.5m] may account for the difference.

Almost 30 years being part of the ACC and AC has resulted in road related stormwater that is unplanned, unconnected and shown to be substandard during flooding this year. Where is the value added by the AC??

P.2

b)  have a district or region that is appropriate for the efficient performance of its role;

We maintain that relative simplicity is a major potential strength of a local council for Waiheke and its neighbouring islands.  They are very, very well understood by our community.  They are small and the developed areas are compact.  Diseconomies of scale are likely to be much more impactful than any economies of scale Waiheke could benefit from given its effective operational isolation.  The only council function that is likely to benefit much from economies of scale – roading – patently does not do so.

Waste management efficiencies might have been another but it is clear that the benefits of community ownership and management are much more likely to be effective at waste reduction and consequent benefits including cost.  They have been in the past on Waiheke and it is now recognised by the AC as preferable to give this function to community organisations where they are interested in taking on the task.

There are many new technologies coming on line that will open up avenues for councils to improve their services or enable them to widen their offerings on a cost effective basis. The Waiheke community is blessed with many residents who are involved in the relevant industries and keen to consider applying technology to operational challenges and potential new services in energy self sufficiency, more flexible and innovative housing solutions, waste management and transport solutions. We are for example already well ahead of the norm in the use of electric cars.

In our application we pointed out that functional activities Waiheke may prefer to buy in such as a library service, technical biosecurity / biodiversity expertise and services, access to CDEM weather and seismic information and expertise etc. could become the subject of inter-council contracting.  We also note that inter-council collaboration is developing and multi council operational units are to be encouraged through new legislated empowerment.

c)  comprise a distinct communities of interest;

 Out of scope for this report but strongly argued in our application as relevant to the Waiheke community.

d)  in the case of a regional council or unitary authority, enable catchment-based flooding and water management issues to be dealt with effectively.

 Addressed above.

 P. 4

Some comments on methodology

As already noted, ML’s methodology makes virtually no references to comparisons with other councils.  They only mention the possibility “of a range of delivery options being available to a new council, including shared service arrangements, which could result in efficiencies”. [p.4]

Their  “ten year modelling also incorporated an allowance for Auckland Council’s capital works programme”. Without any breakdown of the figures we can only repeat that there is NO new capital expenditure planned for Waiheke in the LTP to enable ML to “understand the financial implications of the capital expenditure on the future sustainability of the proposed Option.”

P.5  

“Where direct actual costs are not available an assumption has been made regarding the apportionment of cost to the Option areas. Examples of this include:

• “Stormwater revenue and expenditure, which is allocated based on the length of the piped stormwater network in the affected area” – AC’s Healthy Waters unit has admitted they have no data on much of the stormwater “system” on Waiheke and Watercare collects no revenue here apart from the purpose built wastewater system for Oneroa.
• “Governance costs, which are spread across all ratepayers and have been allocated based on the number of rating units in the affected areas”. The AC assigns assigns more than $1m to the Waiheke Local Board for governance. It has 6 FTE staff dedicated largely to interacting with the massive AC/CCO bureaucracy.  That is far more than comparable councils would directly expend for this purpose.  This is one area ML do claim to have made comparisons to other councils. “Where appropriate “ [our emphasis] we have compared these results with other similar councils under the proposed Option to provide confidence that the results are appropriate”. This does not accord at all with our understanding of the quantum of resources used by rural councils in NZ for this function.
• In any case, we ask which council in NZ could possibly provide an appropriate point of comparison with the AC and its CCO’s? And how would you do the calculations?

Challenges to a sampling of general and activity based assumptions [pp. 6 – 13]

• The increased depreciation and interest costs from Auckland Council’s capital works programme for the area. Why should Waiheke’s residents have to bear these costs when we pay for our own ‘3 waters’, have very poor roads, few streetlights, etc. Many community facilities were built by the community and or the Waiheke County Council.
• No allowance was made for potential increase in operating costs to accommodate a larger population base in the outgoing years. Unless planning decisions change our District Plan significantly, Waiheke’s population growth will be limited to an estimated 11,000 residents plus visitors. Average household sizes and occupancy rates are reducing as old housing is replaced by new homes with fewer or irregular occupants.
• Some activities would have a corresponding increase in operating costs e.g. solid waste for Waiheke. We have pointed out that our waste management system needs to be brought back to the community to maximise efforts to reduce waste and to ensure a better deal from the local commercial sector that accounts for the bulk of waste collected now.
• For water and transport the impact of a growing population is primarily felt on the capital budget, not on the operating budget. Waiheke residents remain determined to resist reticulation and maintain water supply and treatment at the household level. They recognise that to do otherwise is to risk higher densities and growth they do not want.
• Rates have been split into territorial authority and regional council rates based on the proportion of net expenditure allocated to the territorial authority and regional council in that area. Few regional council functions in the proposed Waiheke Council area have any connection with neighbouring local authorities now or in prospect. The Hauraki Gulf is the only connection.  Waiheke has shown itself to be strongly in favour of protecting and enhancing its surrounding waters.  Active membership of the Hauraki Gulf Forum would help to ensure that it plays its part in future.
• Only straight-line assigment of costs can explain the very significant differences in revenue and expenditure as between Options 5 [UC] and 7 [DC]. Our Waiheke firmly rejects that such a big difference in costs would apply to regional functions in practice if Waiheke was to become a Unitary Council.
• Transition costs have not been estimated for the longlist Options assessment. Nevertheless Our Waiheke has argued that they should not be high as it will be a fairly simple matter for the AC to isolate records etc for Waiheke and for it to load data on to ‘off the shelf’ software used by many councils in NZ.  Waiheke’s assets are invariably standalone.  Even the ferry infrastructure on Waiheke was paid for via a wharf tax on ferry tickets.
• In our application we estimated establishment costs of around $5m and assumed that figure would be debt funded. Some comment on this would have been appropriate.
• For Options 6 and 7, we have assumed that the Local Government Act 2002 Amendment Bill (No 2) will be enacted as currently drafted. The proposed changes will allow a local authority to have the responsibilities, duties, and powers of a regional council in respect of a region; and the responsibilities, duties, and powers of a territorial authority in respect of a district that constitutes a part only of that region. These Options are not possible under the current legislation. The legislation was not passed – we have therefore not addressed a Waiheke District Council in any detail.
• There would also be additional costs in transitioning to the new entity including development and implementation of a Regional Policy Statement, Regional Land Transport Plan, regional plans, district plan, policies, bylaws, civil defence, developing a new stand-alone IT system and recruitment costs. These have not been included in the financial results shown….[p.8] Nevertheless Our Waiheke has addressed all these issues in our application and subsequently. We welcome the opportunity to develop plans, particularly the District Plan from which the majority of our submissions were excluded, policies and bylaws specific to our circumstances.  We can build them on existing documents.  Our community has shown itself to be keen for engagement on these issues and we could run consultation processes in tandem for relevant items in a very cost effective way.
• Waste expenditure for the Hauraki Gulf Islands is currently subsidised by mainland ratepayers. Auckland Council carried out a detailed costing exercise for this in 2015, culminating in a report to Council. This specified the subsidy per chargeable unit for Waiheke and Rakino. This was multiplied by the number of chargeable units on each island to determine the total waste subsidy. Costs relating to other Hauraki Gulf Islands including Great Barrier were excluded. This is one way to express what happened – we note the subsidy was first expressed as the average for all the Gulf Islands – at over $700 per residential dwelling – and officers recommended to the Governing Body that the subsidy be stopped with almost immediate effect. The Local Board pushed back vigorously and eventually it was determined that the Waiheke subsidy was actually about $400 per dwelling, Great Barrier over $1000 and Rakino over $2000.
• Officers were recommending that Waiheke households subsidise other Gulf islands! Worse – the figures showed that the bulk of Waiheke rubbish to landfill on the mainland was actually generated by commercial operators and there was no attempt to sheet home the financial impact on to them. The GB also noted that Waiheke has an opportunity to reverse the contracting out of waste management to private operators in 2019 and put the whole matter on hold.
• Debt has been allocated based on the share of total assets within each of the Option areas, as debt is usually associated with the acquisition of new or replacement of assets. Without details we cannot know whether this was done fairly.  We have noted how relatively little Waiheke has by way of debt funded assets purchased by the ACC post 1989, let alone purchased by the AC since 2011. We addressed this issue in our application but once again no mention was made of that in the ML report.
• 2.3.12 Governance, management and organisational support .  Addressed above – hugely more expensive than it would be in a simpler governance context.

P.13

For costs other than organisational support and governance, we have assumed that the current service delivery cost will remain the same as the frontline service levels will not change. This will be the case in areas such as parks and roading, where the majority of costs are locked into external contracts with varying expiry dates.  OW strongly challenge this assertion. In respect of contracts, roading in particular will – or should – have variability built in. We believe that contract renewals will not be far off when a new council is likely to be formed and must surely be subject to goodwill based adjustment in any case.

However, for activities that are predominantly based on staff costs, the economies or diseconomies of scale may mean that the actual cost to deliver the service is higher or lower in the proposed local authorities. OW has made a strong case for diseconomies of scale on Waiheke being the norm given that the multi faceted functional breakdown of the AC and its CCOs is quite inappropriate for the scale of operations involved. We have provided ample evidence on this.

Examples of this include Building Control and Environmental Services which are dependent on a small number of skilled officers. Some activities may not justify a full-time employee e.g. Legal Services in which case external providers may be used but potentially at a higher cost. Where is the evidence for these assertions? We might get these services cheaper overall given the exemplars we have seen in other rural councils.  The cost of travel for the specialists now used is almost unconscionable – Building Inspectors living on Waiheke must work on the mainland while their colleagues are sent to Waiheke – presumably to avoid conflicts of interest etc. Many councils contract out a lot of their legal work – and we have some very skilled operators in that field on Waiheke already.

We could go on but have already provided plenty of material to refute these assertions.

26 Note this is based on the Statistics New Zealand sub-national population estimates which are derived from the census usually resident population count and therefore exclude visitors/tourists

P. 14

There are a number of matters confronting local government and the implications of these are still under investigation. These include the:

• ·  National Policy Statement on Urban Development Capacity

Hardly relevant to Waiheke!

• • ·  National Policy Statement on Freshwater Management

Hardly difficult for Waiheke

• • ·  Climate change.

We welcome the opportunity to become more proactive on this issue – this is far more likely than under the current regime which is focused elsewhere.

P. 27

Option 5 – Waiheke Unitary Authority

Boundaries

New unitary authority created incorporating Waiheke Island, Motuhoropapa, Otata, Pakatoa, Rotoroa, Ponui and Tarakihi islands, and the Noises.

8.1.4 Representation

Unitary authority

• ·  Waiheke Unitary Authority will comprise a mayor and 6 councillors, elected at large.
• ·  There will not be any community boards within the Waiheke Unitary Authority.

8.1.5 Resources

• Additional resourcing and systems would be required. Apart from transition we vigorously dispute this as no more than a bald assertion without evidence. Benchmarking would suggest the reverse is likely after a settling down period
• ·  Premises would need to be identified for the new unitary authority as the current local board office and service centre would be unlikely to be large enough to accommodate the staff required for a unitary authority.
• Addressed in the OW application – we provided $4m for the purpose in our ‘straw man’ budget.  Considering that the current Service Centre cost $2.5m for a major refurbishment recently, $4m should be ample provision for an extension to it.

P. 28

8.2 Summary of assessment against legislative criteria

This Option results in a year one estimated $6.4 million deficit for the Waiheke Unitary Authority. Addressed above

Rates would need to increase by 43% to cover the deficit. In addition there are likely to be significant capability and capacity issues for a unitary authority that is approximately one fifth the size of the smallest current unitary authority in New Zealand. As noted above, there is simply no evidence for this assertion and the general assumption of scale having some direct relationship with competence is a slur on a lot of successful councils in NZ.  We have addressed this assertion in a variety of ways to show Waiheke would be much closer to local government needs and solutions and, including access to the outside sources of assistance being promoted in local government, has the capability to carry out all required legislated functions.

Option 7 – Waiheke District Council

It appears this Option is off the table pending changes in legislation.  In any case we would resist this Option if it meant being tied in any way, other than voluntarily, to the CCOs in place “under” the Auckland Council.

We would seek a relationship similar to RC / DC arrangements in all other parts of NZ apart from UC areas.  We believe a Waiheke Council needs to be clearly accountable through the setting of rates for a discreet programme of services and projects put to the community in the normal way for local government in NZ.

Negotiations for regional services should be conducted after an agreement is made on the range of regional services, as specified in the RMA etc., are determined and Waiheke DC should not be limited to having those regional functions provided by the Auckland Council.

P. 34

Maori involvement in decision making

Auckland Council has the Independent Maori Statutory Board (IMSB) whose role is to ensure there is a voice for Maori in the governance of Auckland and to assist the council with making informed decisions and meeting its statutory obligations in relation to the Treaty of Waitangi. There is an implication in the ML report that somehow a Waiheke Council would dilute or otherwise make less effective, interaction with Maori as it relates to its jurisdiction. We believe that in our context nothing could be further from the truth.

We have supplied a letter from Ngati Paoa, the acknowledged pre-eminent iwi on Waiheke, which stated that they welcome the LGC considering our application.  In addition LG Commissioners have been welcomed on to our Piritahi pan-iwi marae where it was made very clear that Maori on the island support an independent council.

P. 37

12.3 Representation

Currently, Auckland has a Mayor plus 20 Councillors on the governing body, with the mayor elected at large and Councillors elected by wards. This results in an average ratio of one Councillor (including the Mayor) for every 76,876 people.

There are also 21 local boards with 149 elected members. This results in an average ratio of one local board member for every 10,835 people.

Of the local boards on the mainland, Papakura has the smallest population of 52,700.

Against that, Waiheke has less than 10,000 residents. [Great Barrier is a special case and is quite clear it gains far more than it pays by being part of the AC.] It is simply unreasonable and unfair to mainland Aucklanders to expect senior management to spend as much time on Waiheke as they need to now.

We acknowledge that considerable effort has been made by AC management to better meet our aspirations but even their direct intervention in operational matters at times has demonstrated how hard it is for the system overall to be responsive and cost efficient.  AT still leaves a lot to be desired in their willingness to change their regional approach to our very different needs and aspirations and the quality of work, at the cost incurred, is deeply disturbing.

P. 41

• There is an ongoing opportunity to improve co-operation and cohesion between the governing body and local boards through the current Governance Framework Review. We have provided an AC paper on funding and finance from this review which we could not match for eloquence on how difficult it will be to disentangle finances in a meaningful way to give local boards more direct accountability for targeted rating and other dis-aggregations of the centralised financial system

P. 57

Appendix B – Details of the engagement with stakeholders

 Meetings were held with the following stakeholders as part of the preparation of this assessment.

Auckland Council

• Two meetings to discuss the assumptions and financial apportionment exercise

Rodney and Waiheke applicants

• A stakeholder presentation was held and was attended by representatives of:
  •  Local Government Commission
  •  Morrison Low
  •  Alternative proposers including the original applicant

This engagement process can only be described as derisory.  We would have expected a meaningful meeting with the applicants about the content of their various submissions and, given the focus on finances, a discussion about benchmarking vis a vis extrapolation for AC finances. The fact that the latter proved the only focus of ML in the “analysis” explains a lot about why there was so little interaction with any parties – including even the AC [2 meetings!]

P20/21

P. 73

The Productivity Commission’s, ‘Towards better local regulation’ report noted the increasing pressures on local government as a result of:

•  Increasing community expectations
•  Treaty settlements and growing influence of Maori
•  The continuous flow of new regulation
•  Pressures on the physical environment
•  Increased exposure to legal challenge

It is unlikely that any of these will substantially decrease in future and it is considered more likely that these forces will continue to increase over time.

It is ironic that AC management regularly concede that local regulation on Waiheke often suffers from lack of adequate resources to police existing regulations. Tension over lack of enforcement for all sorts of breaches of by-laws, encroachments on council reserves and protected coastal areas etc provided a major reason for the OW application in the first place.

Meanwhile familiarity with and concern for our environment is more rather than less likely to encourage a Waiheke Council to engage in the pursuit of “better local regulation” than a remote bureaucracy with insufficient resources to adequately cater to the remote, low population area that Waiheke is. Local Maori / Ngati Paoa are very involved in our community’s environmental and Treaty related issues.

Pp. 75 – 77 

Option 5 – Waiheke Unitary Authority

Unitary ($M)

There are not specific population increase forecasts for the Waiheke Option area. The overall Auckland rate of forecast population increase has been used instead. Inappropriate to Waiheke – we have seen [but cannot re-find, sorry] projections to some 11,500 residents by 2025 and then a slow decline over the next 20 years.

Based on the information provided, there are no significant capital projects addressing growth in Waiheke over the ten year period, with the majority of expenditure on renewals of existing assets. As noted above.

However it is noted that the modelled transport asset depreciation for Waiheke is approximately $2.5 million per annum lower than the annual renewals programme, suggesting that the model is not allowing for full funding of transport asset depreciation. And we maintain that at $11.3m [ML chart p. 77] this is the item of expenditure that most needs the scrutiny a local council would give it.

Figure 14: Breakdown of expenditure for Waiheke Unitary Authority [p. 77]

Regional Facilities, $0.7m, 2% This seems a lot for just 0.6% of the population

Economic Growth & Visitor Economy, $0.7m, 2% Try telling Waiheke businesses that this is money well spent.  Waiheke is described as one of Auckland’s “jewels in the crowns” but it has won international recognition in its own right over a long period.  It barely rates a mention in ATEED’s promotions, website  etc.

Regulation , $3.7 , 10% Needs scrutiny but in any case largely offset by revenue

Organisational Support , $5.7, 16% and Governance, $0.6m , 2% This is ridiculously high and a major target for scrutiny

Transport, $11.3 , 32% See above – contract renewal not far off

Local & Regional Parks & Sport, $5.2 , 15% Very high and capable of efficiencies / community input

Planning, $1.2 , 3% Just extrapolation – our DP was completed years ago and we were no more than an incidental in the very costly Unitary Plan process.

Waste, $3.0 , 8% See above – new contract opportunity for the community to resume control from 2019

Water & Wastewater, $0.3 , 1% No water – our wastewater system for parts of Oneroa village had been fully user pays but, after “harmonisation” with Watercare’s regional policy, local users had a big reduction in annual fees. Likely to revert to user pays under a local council although we acknowledge an enhanced renewal is needed which may need to be debt funded pending a revised user pays regime.

Environmental Services, $0.4, 1%  For all the talk by ML about the onerous tasks councils must perform in the environmental space this is not a very big spend on the “jewel in the crown” is it?

Figure 15: Breakdown of revenue for Waiheke Unitary Authority

At $29.1m [$31.1m in 2017/18] Waiheke’s revenue is significantly higher than any comparable council in NZ.  The rates take at $14.9m reflects a much higher number of rating units than comparable councils too.

P. 78

Non-financial resources

Regulatory requirements for a unitary authority

Waiheke would welcome control over the policies / plans / by-law development etc needed to meet the requirements raised by ML below. Most would be relatively simple for Waiheke, the only landmass likely to require policies, plans etc in the proposed new council area.  There is a significant body of work already in place to draw on.

–  The new unitary authority would need to have the resources to produce a range of plans as

required by legislation, including:

• • • Regional Policy Statement
    • Regional Plans (e.g. soil, coastal, discharges to land, natural resources, air quality,

freshwater)

• • • Regional Land Transport Plan
    • Regional Pest Management Strategy
    • District Plan (or a unitary plan incorporating RPS and regional plans)
  • –  The new unitary authority would also need to develop bylaws and policies for its area
  • –  The new unitary authority would need to respond to the Hauraki Gulf Marine Park Act 2000 Waiheke is already active in this Forum and the contribution to its operations by similar councils now members of the Forum are only about $20k p.a.
  • –  The new unitary authority would need to take on Civil Defence and Emergency Management functions We have previously submitted how little effect Auckland based CDEM staff have on island [no reports were made of the significant weather / flooding effects in March and April] and we are very proactive on this subject already.  We may have to pay for access to AC’s weather and seismic warning systems.
• ·  Impact on Auckland Miniscule
  • –  Disaggregation and duplication of Auckland Council activities
  • –  Potential risk of stranded costs
  • –  Potential for reduction in rates after transition period for remainder of Auckland Region

P. 79

Governance

There will be increased governance support costs over the status quo for the new council arising from the increased level of representation and breadth of functions. Completely unproved conjecture

The Waiheke proposal creates complexities because of the stronger linkages, particularly with respect to public transport which exist between Waiheke and the Auckland Isthmus. Our ferry service is excluded by Order in Council from the Auckland public transport system.  We would be better placed to deal with local bus timetabling, size of vehicles etc than remote AT staff with who we are forever arguing because of their need to meet regional policies and considerations. Ferry operators negotiate access to mainland ferry terminals and it is in their interest to work with locals on issues.

We note that while there are a significant number of valued workers commuting from Waiheke to [mostly CBD] Auckland, an increasing number of Auckland workers are commuting to Waiheke each working day. It is in the strong interest of both parties to collaborate on our ferry route.

Waiheke would be the unitary authority with the smallest population in New Zealand58, with a population of approximately 9,000. So what? It will also be very small in size and easy to manage and plan for.

The scale of the proposed unitary authority would place stringent limits on the strategic capacity of the council to deliver services to its community.[Our emphasis]  This is a baseless assertion and begs the question on the credentials of the people making it and/or the evidence they have to support it.

This limits the opportunity for discretionary spending, as operational processes and capital works required to meet regulations would consume most of the council’s revenue. We are hard pressed to even imagine the capital works Waiheke would need to meet any new regulations.  Our putative council’s healthy revenue level should be able to accommodate any new regulations just as much as any other council, pro rata, and maybe more easily given the very limited ‘3 waters’ infrastructure foreseen.

The small size of the council’s staff would mean that there is limited scope for advanced strategic planning and policy development, with increased dependence on contracted external expertise. Most staff must be able to cover a range of responsibilities and there would be limited scope for specialists in any one field. Resourcing for complex or unexpected change, whether through natural disaster, regulatory change, personnel changes or outside events is difficult to forecast or manage, and there would likely be a number of key officers for whom there is no or limited back-up available. Many local authorities in NZ would be surprised to learn they are so vulnerable, whether or not they are party to a regional council.

We are part of NZ’s largest labour market for technical expertise and can make use of the increasing collaboration between councils the LGC itself is starting to promote.  As we have submitted, the Waiheke community is more resilient than communities totally reliant on shared, very costly underground infrastructure. Our privately provided utility services are excellent. We are not reliant on roading subject to earthquakes since our roads are seas that will soon calm after the most violent storm. Even tsunamis are not expected to impact on most of our homes.

P. 81

The splitting off of Waiheke Island from the Auckland region would not support integrated growth planning. Thank goodness for that – we risk the effects of decisions of planners who think and operate in the context of Auckland being New Zealand’s fastest growing city.

Waiheke is a popular tourist destination for national and international guests. There may be insufficient capability to support the impact of peak demand and increased growth on infrastructure services such as wharves, local roads, public transport and waste management. A significant part of the attraction of Waiheke is the nature of our community and its talents in wine, food and the arts – it is not just beautiful nature and vistas.  No one is better placed or more motivated to ensure the effects of visitors is not unsustainable than Waiheke’s tangata whenua, residents and ratepayers. Advocacy to central government to provide facilities to accommodate the needs of tourists is now a commonplace for popular tourism destinations.

Impact on Iwi and external groups – addressed above

Inter-regional and inter local authority co-operation will be made more complex with the addition of new councils and this will flow onto bodies like the Hauraki Gulf Forum. Nonsense – we are of and in the Gulf and already in the Forum. We know this assertion just does not stack up.  Unlike council areas surrounding the Gulf, we do not have the population, industry or agricultural pursuits that account for the problems of over fishing, pollution etc the Gulf has experienced. We are at the forefront of efforts to increase marine reserves [a Local Board survey showed overwhelming support for 40% of our waters being placed in ‘no take’ reserves] and to ensure minimal sedimentation and other unwonted run off into our surrounding waters.

Supports the NPS for Freshwater Management Clean Water package of initiatives

There are no major rivers located on Waiheke Island so the National Policy Statement requirements for Freshwater Management and Clean Water will not have a substantial impact on the Waiheke Unitary Authority. However, there may be insufficient capability and capacity within the Waiheke Unitary Authority to support these freshwater changes driven by Government. [Our emphasis]  Nonsense – you would think the first statement cancels out the second.  In any case, we have access to any number of specialists in this field, many of whom have volunteered their input over many years. One of the AC’s foremost specialists in this context lives on Waiheke and catchment plans for the island are nearing completion. The Local Board is actively watching the use of bores and our still very healthy aquifer to ensure against over use etc.

Having had difficulty in gaining remedial action to clean up the stream at our most popular beach for children – the only polluted waterway on Waiheke – from the many parts of AC/AT involved over many years, the Local Board commissioned the Waiheke Resources Trust to carry out a multi-faceted programme to at last effect remediation.  The stream is now clean enough for young children to play in the lagoon, where it borders the beach, almost all of the year. Work to make it all year round proceeds.

Cultural significance of three waters to iwi  

– There would be an additional council involved with the Waitemata Harbour and the Hauraki Gulf. But it would be a council that is more intimately involved and concerned to contribute to an improvement in the inner Gulf than any other – we live in it!

Water Management Issues:

• Catchments protected for drinking water purposes

– There are currently no catchments protected for public drinking water purposes on Waiheke Island. Indeed. QED!

1. 82

Cultural significance of three waters to iwi
Iwi may be concerned splitting Waiheke Island from Auckland Council. Local Maori are very supportive and Ngati Paoa support consideration of our application by the LGC.

ENDS

Small Councils vs Waiheke Council
August 8, 2017

Morrison Low Report – Predetermined or incompetence?
August 7, 2017

Our Waiheke open letter response to the Local Government Commission
August 7, 2017

Decision by the Commission is coming closer
July 9, 2017

Request for access to financial analysis
June 26, 2017

Local Government Commissioners on Waiheke Island
September 23, 2016