4. Local Government Act 2002 Amendment Bill (No 3)—Effect on Costs

[Sitting date: 31 July 2014. Volume:700;Page:1. Text is subject to correction.]

4. JACQUI DEAN (National—Waitaki) to the Associate Minister of Local Government : How will the Local Government Act 2002 Amendment Bill (No 3), passed on Tuesday, help local government reduce costs for ratepayers, families and communities?

Hon Peseta SAM LOTU-IIGA (Associate Minister of Local Government): The bill encourages and facilitates improvements in how local government operates in New Zealand. It does this by supporting councils to operate more efficiently and effectively for our ratepayers. It will do this on issues such as improved shared services, more flexible community consultation, and better transparency in decision making. The bill also helps deliver more concise and easily understood long-term strategic plans that focus on the issues that matter to the community. Finally, the bill will also improve housing affordability for our families and communities by making development contributions fairer and more transparent.

Jacqui Dean : How does the change to development contributions support the Government’s programme to improve housing affordability?

Hon Peseta SAM LOTU-IIGA : Development contributions are a charge on developers that allow territorial authorities to recover some of the capital costs that they incur when building or expanding infrastructure required to serve new developments. The Productivity Commission report on the Inquiry into Housing Affordability in 2012 recognised that development contributions are a key factor in higher house prices. The bill improves housing affordability by, first, including a schedule of assets that provides greater transparency in development contributions policies, and, secondly, including a new objections process with independent decision makers. It also encourages councils to enter into development agreements with developers, to provide innovative solutions. [Interruption] It also—and members opposite know this—better targets what development contributions can be used for, by narrowing the definition of “community infrastructure”. All of this contributes to bringing down the costs of building a home, and improving housing affordability.

Jacqui Dean : How is the bill supporting communities to participate in the forward planning of community infrastructure?

Hon Peseta SAM LOTU-IIGA : Good question. Communities are at the heart of local government, and they should be assured that their community assets are managed carefully. The bill enables communities to participate more fully in decision making, with more flexible arrangements. It provides transparency around key asset management issues, and principal options to address those issues. The bill also introduces mandatory long-term planning for 30 years, as opposed to the current 10 years. This is about having more informed and productive consultation, and making sure the community is heard on the issues that matter to them.

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