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Source: New Zealand Parliament – Hansard

CHRISTOPHER LUXON (National—Botany): Thank you, Madam Chair. I really want to talk to my tabled amendment, and, in particular, it’s really asking that we actually exempt Tauranga City Council, Dunedin City Council, Hamilton City Council, Palmerston North City Council, Hutt City Council, Greater Wellington Regional Council, Waikato Regional Council, Otago Regional Council, and the Bay of Plenty Regional Council.

It’s really important, because, fundamentally, I think the Minister would have to agree that local government is feeling very overwhelmed. It’s facing some of the biggest challenges it’s had in the last 30 years. It’s actually got an unprecedented set of challenges when you actually start to look at it. You’ve got challenges around poor strategic planning, low capacity, big complex projects, poor customer experience, big projects coming through like Three Waters reform, etc. I think, fundamentally, we all know that if local government’s going to be successful—and that’s why these councils need to be on the statutory time frame, not coming in later. They need to be able to understand: are they fundamentally delivering real value to their community? That is the primary job of local government; to make sure they’re delivering real value to their taxpayers and to their ratepayers. A big part of that is to know whether you’re actually benchmarking your performance—and they’re having great transparency around that—and knowing whether you are or are not hitting the mark and doing the right thing with those taxpayers’ funds and getting a good return on that investment.

So there are things like CouncilMARK audits that you can do, but it’s all hit and miss. It’s not compulsory; it’s not mandatory. But these audits, I can tell you, are really important. And we know they’re important, because local government, actually, has disengaged a whole bunch of people in the community. There’s only 25 percent trust in local government, there’s about 40 percent voter turnout. So fundamentally, performance matters and audits like this really matter, particularly to smaller councils like the ones I’ve just talked through.

So I think we know efficient operations of local government all around the world are really, really important. The elimination of wasteful spending; making sure there’s not duplication of effort; making sure there’s really good governance and oversight; making sure that when you’re doing outsourcing agreements, cost-efficient IT—the realm of what a good local council has to deliver upon is really very huge.

So I think, fundamentally, I’ve got a comment around this and a question, fundamentally, around why do we think these governance issues aren’t that important, when these are the small councils that desperately need these services to illuminate what they’re doing well, what they’re not doing well.

The second comment I want to make, and my second question, is that I know the Minister is now sort of a de facto CEO of Air New Zealand, given his recent letter exchange, and it’s wonderful. But I used to be the CEO of Air New Zealand for seven or eight years, and it was a great company. I mean, we went from $4.3 billion to $6 billion, gave the Government fantastic 10 percent return year in, year out. It was wonderful. But if I sat there and I said, “Look, the dog ate my homework, ran over the kid’s bike in the driveway, couldn’t quite the auditors together, missed the deadline for the financial year end.”—not acceptable. Unacceptable. So why do you get another go at it, and everyone else doesn’t get a go at it? Because there’s this so-called global shortage. Scott Morrison’s not dealing with this today, is he? Is he delaying everything statutorily with all this?

Hon Grant Robertson: Yeah, they have.

CHRISTOPHER LUXON: Yeah, right. So the question is, Air New Zealand goes and spends a million dollars doing its own internal audit with Deloitte, and then the Office of the Auditor-General comes in over the top of it—right?—and does a bit of a scan of it all, which is great. But Air New Zealand gets the job done with the proper spending the money, getting it done, getting it sorted. So my question for you is, sort of, why don’t we take Air New Zealand off the mandatory list for the statutory bit and actually put these councils on? Because they much more desperately need the support of these audits, rather than Air New Zealand and these big guys. But I just think it’s amazing that you can actually sit there and just come up with a whole bunch of excuses, push it all out—didn’t quite get my homework in on time, didn’t get done—not just for two years going forward, but you did it last year and we’re doing it for two years. We’ve got a systemic problem. In three years, we can’t sort that problem out. You sort that problem out by going, buying the services, raising wages, doing what you need, bringing in the talent, and we haven’t got it.

So I’ve got two questions. One is: why do you think the governance issues of these local councils—which are so desperate for great illumination about what they’re doing well, what they’re not doing right, so they don’t waste people’s money, so they don’t erode public trust in those institutions. The second thing is, why would you prioritise Air New Zealand as an example of those big organisations that you said you’d do under the statutory time frame over these small councils? Because they need it much more than those big organisations. You can be reassured Air New Zealand will do its job properly; a million dollars with Deloitte gets the job done. And what the Office of the Auditor-General, you could sacrifice that one, I’d say, rather than doing that. So thank you.

Hon GRANT ROBERTSON (Minister of Finance): I am repeating myself, but in light of the fact that the member’s raised the specific matter of Air New Zealand, I’ll repeat for his benefit that the letter that was sent to his colleague Mr Bayly and myself on 2 July indicates that the councils—the exact ones that he’s naming—are going to have their audits completed in the normal statutory time frame. So he can rest assured about that. There’s no competition there between Air New Zealand and those councils. I, of course, will be forensically studying the Air New Zealand accounts, perhaps going back over a number of years, to take a very, very close look at the accounts of—

Hon Gerry Brownlee: Here comes the bully.

Hon GRANT ROBERTSON: —Air New Zealand and make sure that we have a good—

Hon Member: I’d expect nothing more from a CEO of Air New Zealand, like you.

Hon GRANT ROBERTSON: Exactly. Mr Luxon’s very comfortable with that, even if Mr Brownlee isn’t, so that’s good.

So this is the same answer that I’ve given for this question on a number of occasions. The Auditor-General has indicated that he will ensure that those councils will have their audits done inside the time frame.