27 March 2002

Federation Opposes Expanded Powers of Local Government

The expansion of local authority functions to meet populist activities in the Local Government Bill will have significant implications for the rural community who already contribute a disproportionate share of the rate take, says Federated Farmers Vice President Tom Lambie.

"This radical move away from present arrangements, where local government functions are defined by law, has serious implications for landowners that could be expected to fund the expansionist desires of vote seeking councillors.

"General rating of land and capital value will continue to be the main mechanism used for funding services provided to the whole community, yet Councils are going to be allowed to expand into non property related activities. A tax system developed at the start of the seventeenth century is going to be used to fund twenty first century local government.

"Since the 1989 reform of Local Government the disproportionate impact of rates on land and capital based industries has increased and there is little evidence of improved services in the majority of districts.

"The expansion of the power and functions of local authority will exacerbate the situation for farmers, reduce their opportunity for investing in the development of their business and will limit this crucial sector's contribution to economic growth.

"The Bill also introduces a risk of duplication of activities across district and regional councils. Landowners could be asked to pay twice for activities they can not even access.

"Local government should be refocused onto funding those public goods and services that cannot be supplied efficiently by the private sector or central government. Any such services that cannot be met on a user pays basis, and that are not directly related to the land should be funded equitably across all rating units on a uniform basis.

"Government must be challenged to demonstrate that the policy contained in this Bill takes into account ratepayer views. It appears that Government are only interested in what Councils think not ratepayers."

ENDS

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