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Māngere-Ōtāhuhu
Local Board
17 July 2019
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Local
Board feedback on the Productivity Commission inquiry into local government
funding and financing
File No.: CP2019/13169
Te take mō te
pūrongo
Purpose of the report
1. To
provide an opportunity for local boards to formally provide feedback on the
Productivity Commission’s (the commission) inquiry into local government
funding and financing.
Whakarāpopototanga matua
Executive summary
2. On
4 July 2019, the Productivity Commission released its draft report relating to
its local government funding and financing inquiry.
3. The
inquiry’s key aim is establishing whether the existing funding and
financing arrangements are suitable for enabling local authorities to meet current
and future cost pressures.
4. The
commission’s draft report:
· raises
eight questions
· highlights
67 findings
· makes
30 recommendations.
5. Local
boards are advised that their views and feedback for staff to consider when
drafting the submission, need to be received by Monday, 29 July 2019.
6. Auckland
Council will make a submission on the draft report. Staff will prepare a
submission for the Finance and Performance Committee’s consideration at
its meeting on 20 August 2019. Submissions on the inquiry close on 29 August
2019.
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Ngā tūtohunga
Recommendation/s
That the Māngere-Ōtāhuhu
Local Board:
a) provide
formal feedback on the Productivity Commission inquiry into local government
funding and financing.
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Horopaki
Context
7. Central
Government asked the Commission to conduct an inquiry into local government
funding and financing in July 2018. The inquiry’s terms of reference
require the commission to examine the adequacy and efficiency of the current
local government funding and financing framework and, where shortcomings in the
current system are identified, examine options and approaches for improving the
system.
8. The
inquiry’s terms of reference do not call for an assessment of, or changes
to the current scope and responsibilities of local government.
9. The
Commission’s issues paper was released on 6 November 2018. The council
made a submission on the issues paper which was approved by the Finance and
Performance Committee. The council’s submission to the issues paper can
be found as Attachment A.
Tātaritanga me ngā
tohutohu
Analysis and advice
10. The draft report is available on the
commission’s website.
11. The
commission’s ‘At a glance’ document can be found as
Attachment B and its ‘A3 overview’ is at Attachment C.
12. The draft
report states that:
· the
current funding and financing framework is broadly sound but that councils need
new tools to help them deal with some specific cost pressures
· if
councils struggle to deal with rising costs, or are not incentivised to improve
their performance, communities are unlikely to reach their potential
· the
funding and financing framework for local government must incentivise good
performance and enable local authorities to deliver quality amenities and
services that reflect the preferences and aspirations of their communities.
13. The
commission has found that the existing funding model is insufficient to address
cost pressures in the following four areas and that new tools are required:
· supplying
enough infrastructure to support rapid urban growth
· adapting
to the impacts of climate change
· coping
with the growth of tourism
· the
accumulation of responsibilities placed on local government by central
government.
14. The
commission also considers the three-waters sector an important area for
investigation.
15. The
inquiry’s terms of reference have also been amended to require the
commission to consider whether a tax on vacant land would be a useful mechanism
to improve the supply of available housing. The addition is a result of the Tax
Working Group’s final report to the government.
Ngā whakaaweawe me
ngā tirohanga a te rōpū Kaunihera
Council group impacts and views
16. The council
group’s impact and views will be developed and presented for the Finance
and Performance Committee’s consideration at its meeting on 20 August
2019.
Ngā whakaaweawe
ā-rohe me ngā tirohanga a te poari ā-rohe
Local impacts and local board views
17. Local
boards are advised that their views and feedback for staff to consider when
drafting the submission, need to be received by Monday, 29 July 2019.
18. Any formal
feedback received after 29 July and before 19 August 2019 will be provided to
the Finance and Performance Committee to seek their endorsement to incorporate
in the council’s submission.
Tauākī
whakaaweawe Māori
Māori impact statement
19. Staff will
also seek input from the Independent Māori Statutory Board.
Ngā ritenga
ā-pūtea
Financial implications
20. There are no financial implications in deciding
to make a submission. However, there may be positive or negative financial
implications if the government decides to implement any of the recommendations
made by the Productivity Commission.
Ngā raru tūpono me
ngā whakamaurutanga
Risks and mitigations
21. If the local
board does not contribute to the submission, then there is a risk that the
Auckland Council family’s position on this inquiry will not reflect
issues that are important to the local community.
Ngā koringa ā-muri
Next steps
22. The council
will make a submission on the draft report. Staff will prepare a submission for
the Finance and Performance Committee’s
consideration at its meeting on 20 August 2019.
23. A workshop to
discuss the draft council submission with the Finance and Performance Committee
has been scheduled for 15 August 2019.
Ngā tāpirihanga
Attachments
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No.
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Title
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Page
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a⇩ 
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Council submission on the issues paper - approved by
the Finance and Performance Committee on 6 November 2018
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9
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b⇩
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'At a glance' - Local government funding and financing
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39
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c⇩ 
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'At a glance' - A3 briefing
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43
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Ngā kaihaina
Signatories
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Authors
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Andrew Duncan - Manager Financial Policy
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Authorisers
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Ross Tucker - General Manager, Financial Strategy and
Planning
Louise Mason - GM Local Board Services
Rina Tagore - Relationship Manager Mangere-Otahuhu
& Otara-Papatoetoe
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