Gateway cities around the world are so important to national prosperity that they need to be actively supported and with customised arrangements. Auckland Mayor Wayne Brown is right when he says a new relationship between government and the council is required.
Opinion: Wayne Brown may not be a chef, but he has just served up quite a meal with his election manifesto, the Auckland Deal.
He focuses on the core issue highlighted by the State of the City report on Auckland, released last month. The report, which benchmarked Auckland against its international peers, said that without a stronger relationship between Central Government and Auckland Council, the centre of almost 40 percent of the country’s GDP will take longer to resolve its problems and will progressively fall behind its peer competitor cities.
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The first of his six big ideas is that a new relationship and partnership is required. He’s right. The recent two-year-long review into the Future of Local Government found central governments have limited confidence in local governments. The review reported a dysfunctional central-local government relationship with the highly prescriptive legislative framework reflecting low central government trust in the sector.
The current government thought the sector was doing so poorly with water management it legislated to remove billions of dollars of water assets from council control, as well as unilaterally changing house-planning rules in Auckland and elsewhere because too few affordable houses were being built.
Progress on significant, challenging problems almost always starts with a strong-enough relationship. There will be items in Brown’s menu which all the main political parties will find unappetising. Without a relationship/partnership approach to work through these issues, Auckland will continue to suffer.
The mayor’s five other ideas cover transport, housing, other infrastructure including water and climate, the environment, and a mix of social, cultural, and economic areas.
Greater funding is an essential element in improving the state of the city, but a key finding of successive Productivity Commission studies is that councils should make more effective use of targeted rates and value capture on windfall property gains
He has provided the tastiest morsels in the transport, environment, cultural and economic areas. His proposal for a joined-up and funded transport plan for Auckland is a high priority. Connectivity was Auckland’s second-weakest area in the State of the City report.
Auckland’s first Super City mayor, Len Brown, struck the first example of this – the Auckland Transport Alignment Project – with the then Transport Minister Simon Bridges. But it now needs more certainty and commitment from the parties.
In addition to an agreement on projects and timing, funding confirmation including on congestion pricing, or variation “time-of use” charging, is long overdue. Both major parties agree its necessary, and Auckland should own the responsibility of agreeing with Aucklanders what level and specific mechanism is appropriate.
There is little to object to in the environment section, though some will say it doesn’t go far enough. Auckland governs three harbours that together equal a further 30 percent of the size of the Auckland region. Threats are increasing in all of them. It also has responsibilities shared with other councils for the vast Hauraki Gulf. Both main political parties agree the 23-year-old legislation governing the gulf needs updating.
Brown’s call in this section for funding to help with carbon emissions reductions makes sense and should be provided via the $3 billion Climate Emergency Response Fund.
In the cultural and economic areas, it’s lazy that no government has resolved the 13-year-old legacy issues of how the Auckland Museum, Motat and regional amenities are funded. Stadiums are missing from this list, and resolving this expensive and longstanding problem could be part of this work.
Prioritising the city’s economic development specifically working with the private sector to plug the looming innovation deficit Auckland has should be high on the action list. Auckland ranked lowest in innovation compared with peer cities, with other cities accelerating in the fast-growing technology strategic sectors such as cleantech, healthtech and the internet of things deployment. Government has a key partnership role to play here.
There are areas in Brown’s manifesto that are likely to be too bitter a taste for any new government. These relate to some of the revenue tools the mayor wants, including rates paid on Crown property, an annual transfer of the GST paid on all rates and increases to development contributions. Former Auckland Mayor Phil Goff spent six years trying to persuade his own political party of the merits of transferring GST on rates but to no avail.
Greater funding is an essential element in improving the state of the city, but a key finding of successive Productivity Commission studies is that councils should make more effective use of targeted rates and value capture on windfall property gains. In high-growth areas, the commission recommends councils should be able to levy new charges such as volumetric wastewater and road-congestion charges. The government has also created the ability for debt-constrained councils to establish, with government support, special-purpose vehicles to fund growth infrastructure. Given the constrained fiscal environment the new government is heading into, new revenue that is funded by growth will be more attractive than the government transferring Crown funds to councils.
Where increased direct government contribution is justified, the English Devolution Accountability Framework may offer reassurance for governments and ratepayers sceptical of undertaking this. The framework is a recent product of the devolution agenda underway in England since 2014 in which “metro-mayors” of amalgamated councils negotiate funding contracts with the central government for agreed services. The Accountability Framework will monitor performance, value for money and boost transparency. It will allow tax and ratepayers to assess how their city is performing with the funding provided by central government. The city deal approach, used in Australia and the UK to fund agreed priority local projects, that National is proposing this election could be deployed in this way.
Brown’s other idea that Auckland acquires an opt-out provision from the current government’s housing density and planning changes may run into the meatgrinder. The two main parties originally agreed to do this because not enough more-affordable housing was being built in Auckland under the existing regime.
A request for new legislation features regularly in the manifesto and this will be unavoidable for Auckland Museum, Motat and the Hauraki Gulf.
However, partnership is one of the most frequently used words in Brown’s manifesto, and establishing this should be the first strategy for making progress.
The manifesto is clear on what the problems and costs are but the benefits, although real in many areas, could be more strongly stated.
The State of the City said that around the world national governments have long recognised their main gateway cities are so important to national prosperity that they need to support them actively and with customised arrangements.
Over time many have acknowledged this, because without doing so the nation is missing out on jobs, investments, trade partners, talent, visitors, events, and the tax revenues that come with them.
New Zealand still struggles to recognise that the net financial advantages of this approach, as well as the skills, productivity, and brand benefits that the whole nation benefits from, are compelling reasons for its government to invest more in its biggest city.
State of the City said that the most important driver of city performance was consistent investment and credible plans to service a city’s growth and other challenges. This needs the city’s specific co-ordination and commitments with national government undertaken by collaborative working relationships. These points are also at the heart of Wayne Brown’s manifesto. Of the 29 points he raises, there are at least 20 that any new government should be able to make progress on.
This manifesto may be a late addition to the election menu, but it has the potential to provide considerable sustenance to whoever forms the next government.
