ORC fears `barb' in amendment to Act

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By Rebecca Fox on Thu, 13 Dec 2012
The Regions: Otago | ORC

Requiring councils to perform in a way that is ''most cost-effective for households and businesses'' could see local bodies challenged in court for not taking the cheapest option, the Otago Regional Council says.

Discussing the Local Government Amendment Act 2002 Amendment Bill at the last council meeting of the year, corporate services director Wayne Scott said the term was a ''barb'' as it had the potential for people to take cost-effective to mean the cheapest.

If the council did not take the cheapest option, then ''we could see local government in the courts''.

The rest of the changes to the purpose of local government, which was used to measure all council activities against, should fit, he said.

The council had in the past linked its activities to the former purpose of ''social, economic, environmental and cultural wellbeing of communities''.

It would now have to reassess projects against the new purpose - ''good-quality local infrastructure, local public services and performance of regulatory functions in a way that is most cost-effective'' - as part of its annual plan process early next year.

Council chairman Stephen Woodhead said there were last-minute attempts by Local Government New Zealand to remove the ''cost-effective'' wording but it was unsuccessful.

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Being cost effective

Submitted by MikeStk on Thu, 13/12/2012 - 4:56pm.

guadalajara: well that's not the way it's supposed to work - the National government has changed the Local Govt act not just to require that the DCC be "cost effective for residents" they have changed it in such a way that they have changed the DCC's statutory purpose, its main goal in life, its reason for existence, is to be so - that means that yes the DCC has to use the cheapest paper clips available, to recycle paper clips, use staples, or use no paper clips, or even no paper, if that's more cost effective - a great example is this latest  $700k stadium boondoggle - what's more cost effective: paying DVML $700k a year and raising rates, or continuing to rent out community halls as we've always done? Seems a pretty cut and dried decision for the council to me.

Should the ORFU come cap in hand again looking for another hand out should  the council give them anything?  No it would be against the council's statutory purpose. Should we keep propping up DVML when they could be asking the ORFU to pay enough to use the stadium so that it doesn't run at a loss subsidised by the ratepayers? again that would be against the council's new statutory purpose. Should we close a money losing stadium if it would cost the ratepayers more to keep it open? nope, the council can't do this, not any  more.

The council really no longer has a choice in the matter as the law now ties its hands. If a more cost-effective (to the ratepayers) alternative exists the council's very purpose is now to use it.

 

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I can see it now...

Submitted by guadalajara on Thu, 13/12/2012 - 2:54pm.

Dunedin's self-appointed expenditure watchdogs will be running to the lawyers everytime someone in the DCC procurement department buys a box of paperclips from Whitcoulls as opposed to a cheaper version from Warehouse Stationery.  

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Excellent move

Submitted by MikeStk on Thu, 13/12/2012 - 9:28am.

This is not a 'barb'. This is a well reasoned shift in the way that power is distributed to our local authorities. No longer can a few out of control councillors spend millions of dollars of the ratepayers' hard earned cash without considering the issue of who will have to pay - now reducing rates takes priority over flights of fancy like free stadiums for for-profit entertainment bodies.
Organisations like the ORFU will now have to fend for themselves without having the luxury of a few councillors ever willing to raid my wallet to pay for their fun.
I don't expect our councils to change their profligate ways any time soon - after all, it is so easy to spend other people's money. Legal pressure will have to be applied, so let the lawsuits begin - all we can lose are our enormous rates bills.

 

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