Businesses welcome Local Government Act Review

Businesses and farmers will welcome the proposed review of the Local Government Act 2002 according to the Local Government Forum.

“We believe the sector is due for some significant reforms and the Local Government Minister deserves credit for taking it on,” said Chair of the Forum, Charles Finny.

“The analysis of draft 2009 - 2019 long-term council community plans, recently released by the Department of Internal Affairs, shows that council spending is expected to blow out of control without some major constraints.  The 41% increase in total operating expenditure over the next 10 years comes on top of some already significant increases.

“We think the local government sector has expanded its sphere of activity too widely in recent years and it has not had sufficient disciplines on it to contain its expenditure.

“We are also concerned about inadequate scrutiny of local government expenditure and the need for more effective monitoring of its performance.

“The idea of capping council spending increases and encouraging or requiring local authorities to make greater use of referenda if they wish to undertake significant new activities beyond a core role is worth pursuing.

“Binding referenda on new projects would attract interest from rate-payers, especially where full information as to the project’s cost is provided. The preference of citizens would be much more likely disclosed through referenda than through the existing consultative exercises.

“There would be a great deal of debate as to what would be the core range of services local government can provide without calling a referendum but this, in itself, would also be healthy.

“If local bodies are to serve their communities well they should be clear about which are the vital services they need to provide, and they should excel at them,” Mr Finny concluded.

ends

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