Article 5: Local authority elections 2010

Requests for advice and enquiries to the Auditor-General have historically tended to increase in the period leading up to local authority elections, and this can continue for a period after the elections. Most requests are about the application of the Local Authorities (Members’ Interests) Act 1968 (the Members’ Interests Act) to candidates for election who have contracts with the local authority. We have also received requests in the past to inquire into:

• communication in the pre-election period; and
• decision-making by councils after the election.

For the 2010 elections, we dealt with a steady stream of questions from election candidates about the Members’ Interests Act. We were pleased that there were fewer concerns raised than in previous elections about communication and none so far about decision-making. We summarise the main issues below.

Election candidates and the Local Authorities (Members’ Interests) Act 1968

The Members’ Interests Act contains some complex rules for election candidates. The basic rule in section 3 of the Members’ Interests Act is that a person cannot be elected to a local authority if they have a current contract with the authority under which they will be paid more than $25,000 in a financial year. There are several exceptions in the Members’ Interests Act – for example, if:

• the obligations under the contract have been completed and the price is already fixed; or
• the obligations under the contract have not been completed, and the amount to be paid is not fixed, but the contract is for less than 12 months.

If these exceptions do not apply, a person can only be elected if they relinquish the contract with the local authority’s agreement within a month of being elected. This is not always suitable for the candidate or the authority.

We received several requests from candidates for the 2010 elections to give approval for existing contracts with local authorities. In some instances, candidates were referred to us by local electoral officers. However, the Auditor-General has no power to give such approvals.

In most instances, we found that the candidates were not disqualified from being elected because payments under the contract were in fact less than $25,000 or because one of the exceptions in the Members’ Interests Act applied.

We have called for the Members’ Interests Act to be reviewed, including reviewing whether these rules for candidates should be retained or updated. We will need to ensure that candidates and electoral officers have the correct information for the next elections if these rules are still in place.

We also received several questions from candidates for local boards in Auckland about the contracting rule. Local boards are subject to the Members’ Interests Act as if they were local authorities, but the extent of contracting activities involving local boards is not yet clear. It appears that local boards will not enter contracts in their own right, but the contracting rule would apply if the Auckland Council were to enter into a contract with a local board member and the contract is on behalf of the local board.

Communication in the pre-election period

I am pleased to note that we received far fewer complaints about council communications in the three month “pre-election” period before the 2010 elections than for the 2007 elections. We do not have any particular role in this area, but we did issue good practice guidance in 2004.⁸

Our guidance in this area, although it pre-dates more modern ways of communicating such as Facebook and Twitter, contains some simple principles that we consider relevant – namely, that:

• council staff need to maintain their neutrality;
• the public funds that councils administer should not be used for electioneering or to benefit one candidate over another;
• councillors are still in office during the election campaign and remain responsible for the activities of the organisation; and
• ordinary business has to continue despite the election, which includes ongoing communication with the (voting) public.

Our guidance encourages each local authority to adopt its own policy for managing communication during election periods.

We reminded the sector in our annual report to Parliament⁹ before the 2010 elections of some of the issues that resulted in complaints to the Auditor-General in the 2007 elections. They included:

• public events and launches;
• councillor and mayoral columns and other communication channels; and
• communication from council staff.

We are pleased to note that councils appear to be handling these issues well, if the lack of complaints to us during the 2010 elections is anything to go by.

The few questions we did get this year were about councillor’s columns or commentary on their activities in council newspapers or websites, and about councillors using their council email address or council email lists for electoral communications. Our advice in this area is that these communication channels can create risk during an election period. Many councils have policies that suspend such communication during a defined pre-election period. This is a very simple way of removing the risk.

The media is interested in this area, and we are sometimes asked to comment on particular issues. We tend to respond to such questions by stating that our guidance is good practice only, that it is for each local authority to develop and apply its own communication guidelines, and that we do not have any role in enforcing the guidelines. In short, we expect that councils will properly manage these issues.

Decision-making by councils after the election

After the 2007 local authority elections, we received several complaints about newly elected councils quickly deciding to change or reverse decisions of the previous council. We reported on the approach we took to these complaints in a previous report to the sector.¹⁰

These complaints raise important issues about the relationship between the decision-making requirements of the Local Government Act and the democratic and political context of local authority decision-making. They can also raise concerns about bias (predetermination) where candidates have expressed strong views on issues when campaigning for office.

In 2007, we concluded that the relevant council was able to make the decision under the Act. However, the councils could have been more transparent in their decision-making process. This would have enabled the community to more easily see and understand the basis on which the council was making the decision.

We thought that similar issues may arise after the 2010 elections, but we have not yet received any complaints or inquiry requests in this area.

On the subject of bias, councillors will be judged on how they conduct themselves once elected. They need to show that they have an open mind despite what they said before being elected, and that they will consider other viewpoints and submissions from the public where consultation has occurred. They will be judged by their attentiveness and conduct at relevant meetings, and by evidence that they have read and considered submissions rather than having a predetermined view that they will not change. We do not have any role in considering complaints in this area unless financial interests are involved, but it is raised with us fairly frequently.

8: Good Practice for Managing Public Communications by Local Authorities (2004).

9: Local government: Results of the 2008/09 audits.

10: Local government: Results of the 2007/08 audits (June 2009), Part 5.