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Councillors at yesterday's Dunedin City Council meeting voted narrowly to support a new approach to the way in which their pay was calculated.
The move came after the Remuneration Authority launched a review of existing arrangements, in place since 2001.
All councillors were paid from one central funding pool distributed by the authority, which decided how much individual councils received, a report by council governance manager Sandy Graham said.
The authority's review suggested two possible alternatives and asked councils for submissions on their preferred option.
A modified pool approach would instead have separate pools of funding created for each council, with the authority deciding how it was distributed after considering recommendations from councils.
An alternative approach could have the authority specifying a base salary for individual councillors or community board members across New Zealand, and then adjusting it for those with extra responsibilities.
Ms Graham's report noted the modified pool approach would allow councils to determine appropriate pay rates, but might create a problem with public perception.
A specified salary would be less complex and provide a perception of greater fairness, with councillors performing similar roles across New Zealand paid the same, but would require considerable work to set up, Ms Graham said.
Cr Lee Vandervis backed the specified salary approach at yesterday's meeting, and moved the council endorse it in its submission to the authority.
He felt "uneasy" about any involvement by councillors in determining their own pay, and Cr John Bezett agreed, saying funding pools could be open to "possible political lobby" and should be scrapped.
He "strongly" urged councillors to support the alternative specified salary approach, saying it was "the only fair way of doing it".
Cr Syd Brown said his most uncomfortable days as a councillor came when discussing pay rates, and a specified salary removed that problem.
"To me, this is the only option."
However, Cr Vandervis' move to endorse the specified salary approach was lost 8-7 when put to the vote, meaning the council's submission would endorse the modified pool approach giving them more input.
That came after Cr Jinty MacTavish - supported by Cr Richard Thomson - said councillors' workloads were "quite different" across New Zealand, and deputy mayor Chris Staynes worried about a "one-size-fits-all" approach.
Submissions close on November 10, and the review would also consider possible changes to community board remuneration.
One option would have board members funded from outside the council pool, freeing up more money and pushing Dunedin city councillors' $44,245 base salaries up to about $56,000, Ms Graham's report said.