Part 4: Two-tier governance – balancing local, regional, and functional perspectives

Auckland Council: Transition and emerging challenges.

The formal structure and the intentions of the Auckland reforms

4.1
At its heart, local government is about place. A significant challenge for the Auckland reforms was creating a governance structure that could tackle regional issues and that could also connect with, and respond to, local communities; strengthening sense of place and local democracy.

4.2
The Local Government (Auckland Council) Act 2009 (the Act) established a two-tier governance structure, comprising the governing body and 21 local boards. Thirteen wards elect 20 councillors to the governing body. Broadly, the design is for the governing body to deal with decision-making at a strategic and regional level. The 21 local boards deal with:

community-based engagement;
shaping and monitoring local services; and
bringing local perspectives to region-wide policies and plans.

4.3
The Local Government Commission is responsible for determining the number and boundaries of local boards within the considerations set out by the Act. Figure 4 sets out the governance structure of the Council.

Figure 4
Auckland Council's governance structure

Source: Auckland Council.

4.4
The original hope of Hon. Rodney Hide, the Minister overseeing the reform legislation, was that the local board areas would reflect natural communities of interest that were recognised by residents as their communities or townships. In this way, local boards could work as "eyes and ears", helping initiate responses to issues and interests at a grassroots level.

4.5
However, the Minister concluded that 20 to 30 was the maximum number of local boards that could realistically be managed. This conclusion was reached after considering the size boards would need to be to attract capable people to stand for election, carry out local decision-making, and engage effectively with the Council. The cost of administering a larger number of boards was also a consideration.

4.6
Local boards were intended to enable the governing body to focus more effectively on regional issues. Decision-making responsibilities are shared between the two tiers. Both tiers are responsible and democratically accountable for the Council's decision-making.

4.7
Under section 15 of the Act, the governing body is responsible and democratically accountable for decision-making about:

regulatory responsibilities, duties, or powers conferred by legislation;
allocation of decision-making responsibility for non-regulatory activities of the Council to either the governing body or the local boards and decision-making in respect of those non-regulatory activities it allocates to itself ;
the agreement reached with each local board (as set out in each local board agreement) in respect of local activities for the local board areas;
establishment and maintenance of capacity to provide, or ensure the provision of, services and facilities;
governance of CCOs;
transport objectives and funding; and
prudent financial management.

4.8
Section 16 of the Act sets out the classes of decisions that local boards must make and are democratically accountable for, as:

non-regulatory services allocated to it by the governing body;
the agreement reached with the governing body (as set out in the local board agreement) in respect of local activities for its local board area;
identifying and communicating their community's needs, interests, and preferences on strategies, plans, policies, and bylaws; and
identifying and developing bylaws for its local board area, and proposing them to the governing body.

4.9
Section 17 of the Act requires the governing body to allocate decision-making about non-regulatory activity to boards unless decision-making on an Auckland-wide basis will better promote the well-being of the communities across Auckland because:

the decision will affect more than one board area;
the decision must align or integrate with other decisions that are the responsibility of the governing body; and
the benefits of a consistent or co-ordinated approach will outweigh those of diverse community needs and preferences.

4.10
These principles and responsibilities are given effect through procedural requirements for three-year local board plans and annual agreements, and by including local board information in the Council's LTP and annual plan.

4.11
Under section 20 of the Act, a local board plan is to:

reflect the priorities and preferences of the communities for local activities to be provided by the Council during the next three years;
identify the interests and preferences of the people within the area to enable the local board to communicate those interests and preferences;
provide a basis for developing an annual local board agreement;
inform the development of the LTP, particularly for the activities allocated to local boards for decision-making responsibility; and
provide an opportunity for public participation in decision-making on local activities to be provided by the Council, and a basis for accountability of the local board to its communities.

4.12
Under section 21, each local board plan is the basis for a local board agreement between the Council and the local board, which sets out how the Council will reflect the priorities and preferences in the local board's plan in respect of:

the local activities to be provided in the local board area:
the responsibilities, duties, or powers delegated to the local board by the governing body; and
the implementation or enforcement of bylaws made by the Council as a result of local board proposals.

4.13
In its report, the ATA described the relationships needed to make the statutory arrangements function:

The new legislative arrangements for Auckland's local government confer on all elected members a defined role to regularly engage with their respective community of interest in order to understand their views and priorities. The elected councillors of the governing body will need to establish effective working relationships with communities across the region and with organisations that are important to the Auckland region as a whole, including central government and other national organisations and stakeholder groups. The elected local board members will need to establish close working relationships with their local community and other organisations that are important in the local area.

Effective collaboration between local boards, the governing body, and the CCOs will be essential. Local boards will provide local input into region-wide strategies, policies, and plans that are the responsibility of the governing body, and to which the CCOs are required to give effect.

Local boards may also work together to discuss and address common issues, or issues affecting more than one local board area. Indeed, the Auckland Council Act stipulates that a local board should collaborate and cooperate with one or more other local boards in situations where the interest of communities within each local board area will be better served by doing so.

What we heard – two-tier governance or co-governance

4.14
Many people we spoke to described the Council's two-tier governance structure as "co-governance". The Local Government (Auckland Council) Act 2009 does not use the term co-governance. We understood those using the term to mean that each governance tier has its own decision-making sphere that is distinct but complementary. We also understood them to mean that neither tier was subordinate to the other. However, we observed that these co-governance expectations have been frustrated to some extent. We heard very different views about the discretion that the governing body and local boards currently have and about the roles they may have in the future.

4.15
Most people we spoke to suggested that the governance structure is not yet fully working, and will take two or three election cycles to embed. We were told that:

the governing body had not yet taken on its strategic and regional governance role but was still operating as an "old-style" council; and
local boards had not yet embraced their part in collective responsibility for the Council's decision-making, and tended to act in a more limited community advocacy role.

4.16
Some people we spoke to said that it would have helped for roles to have been more defined at the start of the process. We were told generally that confusion about governance roles has been and remains common among elected members, Council staff, and CCO governors and staff. Some were of the view that the governing body needed a clearer mandate for setting budgets rather than negotiating them; reflecting their accountability for the Council, its budget, and strategy.

4.17
Many people elected to the governing body and local boards served on the former councils and community boards. Their continued service has brought a wealth of expertise and experience that was universally recognised and appreciated. It has also thrown these people into new governance arrangements, to which they are adapting their previous experience and knowledge. Many people we spoke to felt that it may not yet be clear to the individuals who stood for Auckland's new elected offices which governance tier they might best contribute to.

Uncertainty about governance forum roles and decision-making authority

4.18
We were told of several examples of uncertainty about governance roles and decision-making authority.

4.19
Funding for two events was allocated to a local board's area. In the past, these events had been held in three local board areas on an annual rotating basis. The local board sought clarification and understood that it had discretion to determine how the funding assigned to its local area was spent. It decided to reassign the money to other uses. A governing body member, using the basis that the funding was a regional matter as it affected more than one local board, then successfully moved an amendment at a Council committee meeting to return the money to the events it was originally planned for. It does not appear to have been clear in this instance:

whether expenditure mapped to local areas was the decision-making responsibility of the governing body or local boards;
under what circumstances a local board has the discretion to reassign expenditure allocated to the local area; or
whether any process other than local board decision is needed to reassign funds mapped to local areas.

4.20
We were told that work is still in progress on budget mapping to local areas.

4.21
To support a diverse range of local activities and events, local authorities often provide grant funding to local not-for-profit community clubs and organisations. Each of the former councils had its own funding arrangements for grants. However, these arrangements could not be translated to the local board areas. Instead, an overall allowance of grant funding for each board to distribute was needed.

4.22
Many community groups have come to expect funding from the Council and may have been receiving support from more than one of the former councils. Getting an overall picture of the funding for community groups throughout the region in the past and minimising the effect of the changes for these groups, while moving to a basis for allocating a fair amount of funds for each local board to distribute, has been extremely challenging.

4.23
Regional integration has limited the amount of local input into decision-making about local road amenities. Before the amalgamation, community boards had the authority from the former councils to determine ‘place-shaping' matters, such as traffic calming measures, the location of street furniture, and where to designate bus stops and parking. After amalgamation, Auckland Transport has a primary duty for an integrated regional network and responsibility for all activities within the roading corridor. Auckland Transport is achieving significant improvements in the wider economic efficiency of the transport system by focusing on the smooth movement of vehicles across the network.

4.24
Auckland Transport has chosen to retain decision-making over local road amenities on the basis that it needs to manage the regional efficiency of transport movement. It has declined to delegate decision-making powers to local boards and, in some instances, to carry out some small amenity changes suggested by local boards where, in its view, those changes would affect other parts of the transport network. These include suggested locations of bus stops, curb protrusions, and parking zones that would slow the movement of transport through the system or would congest traffic in other areas that are less safe for this to occur, such as past schools. This has resulted in some local boards feeling that they have less influence in ‘place-shaping' than the former community boards.

Bringing the local boards into decision-making and accountability for the financial consequences

4.25
Despite these issues, we were told of the value that local boards provide through their work in community representation and engagement. We were also told that it is difficult to make local input real and effective without compromising the needs of regional integration.

4.26
There was a growing recognition of how the Council could use local boards' knowledge of, and ability to articulate, the needs and interests of their communities to adapt services toward these needs. We heard that local boards' care of these aspects allowed the governing body to focus on the Auckland Plan and its associated projects and initiatives.

4.27
As the CCO with the most significant and ongoing relationship with local boards, Auckland Transport dedicates resources and staff time to liaising with local boards. Although it is unwilling to delegate final decision-making responsibility for local road amenities to local boards, Auckland Transport places a high value on local boards' knowledge about how roads and the associated amenities are operating for their communities.

4.28
Local boards are best able to articulate the needs and interests of communities where their areas reflect natural communities. Some local board members told us that, in their view, their local area boundaries had been set more for population numbers than to mark out a geographic community of interest with a distinct identity. In some instances, this was seen as resulting in a loss of accessible locally based representation.

4.29
The Council's overall rating approach mainly uses general rates that are not tied to the cost of the services in any specific area. Council staff suggested that needs particular to local board areas could be funded through targeted rates. This is a tool available under legislation to fund services and amenities that have benefit patterns that are not consistent with a general rating approach.

4.30
We were told that local boards had, to date, not viewed this suggestion as appropriate for two reasons:

For the first 18 months of the Council's operation after the amalgamation, service levels remained notionally at the levels that were provided by, or committed to, by the former councils. Only since 1 July 2012 have changes begun to specify and standardise levels of service.
There is not the same level of availability of amenities in all local board areas. We were told that this is because the former councils made different decisions about investing in amenities. However, we were also told of instances where a local board wanted more park or swimming amenities within their boundaries when there were already such amenities a street or two away within the next board area. Addressing questions about local amenities is a long-term investment strategy that will require local boards to be not too literal about boundaries.

Governing body members' electorate responsibility

4.31
Twenty members are elected by 13 wards to the governing body of the Council. The members are elected to make decisions on behalf of their electorate in the interests of the region. We observed that this role is similar to that of members of Parliament. However, general electorate members of Parliament (who are elected to represent geographic areas) also have constituency duties that form a significant part of their normal working weeks. Many told us that much of the work traditionally performed by local authority councillors is now being carried out by local board members, although this does vary between individuals and areas. Governing body members told us that they continue to have constituent contact on a range of matters, as well as on regional and strategy matters.

4.32
Many told us is that the constituency role for governing body members has become less clear. The place of governing body members in articulating and presenting regional directions is also less clear given the increased role of the Mayor in articulating the regional vision and strategy.

4.33
Many people we spoke to questioned whether governing body members are now more remote from their electorate than they would have been under the former councils. Questions were raised about:

whether their role and work is visible to their local electorate;
what opportunities they have to build electoral profiles and support for their regional role; and
whether, in acting in the interests of the region, they are also expected to act in the interests of their ward.

4.34
Many people we spoke to identified a risk that governing body members have limited incentives to shift their mode of operation to a regional mindset because they may be criticised by local board members for failing to invest in their ward.

Issues with day-to-day expectations and communication

4.35
We were told of issues with day-to-day expectations and communication.

4.36
Local board members told us that they would not generally ask for, or expect to get, assistance from governing body members to address public concerns. In practice, local board members get assistance and advice from their own office staff. However, based on their overview of Council operations, plans, and policies, governing body members considered that they could be a source of advice for navigating the Council's decision-making and administrative structures.

4.37
Local board members were concerned that governing body members did not take as many opportunities as they could to hear and understand local aspirations and issues. For example, we were told that there is not full attendance when local boards present their plans to governing body meetings, and that local board annual agreements are considered by the Strategy and Finance Committee and reported to the governing body. We were also told that access to senior elected members, such as the Mayor, can be difficult to arrange.

4.38
We heard from local board members that expectations of whether governing body members would attend local board meetings was "case by case" and depended on what worked for the people involved. Generally, many governing body members attend local board meetings. Curiously, governing body members tended to assume that they would not be welcome and local board members tended to assume that governing body members would not be interested in attending.

Local board and governing body planning and consultation

4.39
We were told that the two-tier governance structure complicates planning and budgeting processes in ways that have not been experienced by local authorities before the Council was set up. For example, as part of the governing body's consideration of policy, local boards are required to be consulted on every policy, meaning more process and engagement on policy development within the Council.

4.40
More time for, and more phases of, governance discussion is needed when preparing the draft LTP and annual plan for public consultation. For example:

local board plans for each local board area need to be reconciled with the LTP and funding policy set by the governing body and reflected in local board agreements;
local boards need to be involved in formulating options and proposals for particular decisions on which public feedback is sought (rather than their input being limited to consultation at later phases);
iterations of local board and governing body consideration and decision-making are required for the preparation of the draft and adoption of the final LTP or annual plan; and
decisions need to be made about the format, extent of detail, and communication of the information that is made available to the public.

4.41
We were also told that efforts to meet statutory requirements have led to confused and duplicative consultation with the public. We were also told of concerns that the public do not know to whom to submit or why matters on which they have already submitted to the local boards are being reconsidered by the governing body.

4.42
Public consultation is carried out using the special consultative procedure under the Local Government Act 2002, annually on each local board plan and on the Council's LTP (every three years) or its annual plan in the intervening years. There is significant public interest in the Council and its intentions. The Council received more than 10,000 submissions on its draft 2012-22 LTP. Of these, nearly 50% raised dog registration issues, nearly 25% raised transport issues, and more than 15% raised general rates and rating policy issues. More than 1676 submitters requested that their submissions be heard.

Governance workloads are heavy and stretching resources

4.43
With no fixed job description, the time commitment involved in being an elected member to the Council varies both between individuals and according to the subcommittee structures and membership of committees. We were told that the Council's governing body members have heavy workloads. Even though all are working fulltime in their governance roles, the amount of information members need to read and understand is extensive. Although staff try to help by summarising information, governing body members are sometimes anxious that they have not had access to the full information associated with significant or complex decisions.

4.44
Members of the governing body have large constituencies, comparable to those of general electorate members of Parliament. However, they are provided with very limited administrative support and have no staff support for important activities, such as research or analysis for their Council committee work or for dealing with constituency concerns.

4.45
Because local boards are consulted about all policies, strategies, and plans, local board members are also required to read and understand a huge volume and range of papers. For members of local boards and the governing body, there are workshops that provide background information on issues, as well as formal meetings. Most local board chairpersons and some governing body members are also working fulltime. We were shown some local board agendas and saw large papers not specific to each local board that were sometimes badly (and, in one instance, illegibly) reproduced.

4.46
Local board members considered that the Council's staffing numbers started below the baseline in many areas, including resourcing for local boards and local area servicing. Local boards saw the Council as still being in "catch-up mode". As a result, local board activity was seen as under-resourced in several ways. We were told that:

a lack of secretarial support meant that meeting papers were sometimes late and items were omitted or forgotten; and
there were limited resources for local board communications in Council information. Each local board has a page in the monthly Council publication and advertorials in community papers. While there is a dedicated communications team that provides support to local boards, some local board members told us they received no support with media communications.

4.47
All agreed that local boards need to be properly resourced for their role. However, the developing understanding of that role means that the resourcing required has not been clear. Adjustments have been made to local boards' resourcing as their needs have become clearer. For example, staff numbers in the 10 teams that provide local board support have been increasing, along with resourcing for community engagement.

4.48
With 21 boards to be serviced, a lot of practical effort is involved. Staff support for local boards has to be senior and appropriately experienced, so even getting appropriate advisory staff to attend 21 local board meetings cannot always be carried out within a calendar month. CCOs are facing similar challenges in their work liaising with local boards.

The Council's future intentions

4.49
Council staff and governors are taking steps to provide a more stable base of expectations and to streamline decision-making processes. Mechanisms such as joint workshops, joint working parties, and inclusion of local board chairpersons or representatives are being used. Their aim is to reduce tensions arising from misaligned expectations and to identify areas of clearer and greater discretion for both governance tiers.

4.50
For example, to carry out its 2012 planning and budgeting, the Finance and Strategy Committee held workshops with local boards to share the development of plans and budgets, and to reduce any sense of local boards presenting plans for the governing body to agree or approve. Ironically, we were told by some local board chairpersons that they appreciated the opportunity to present the local plan for their area to the governing body.

4.51
The Mayor, the Deputy Mayor, the Chairman of the Finance and Strategy Committee and the chairpersons of local boards are trying to have regular meetings to improve communication.

4.52
The Council is considering whether codes of conduct, and protocols about behavioural and practice expectations, would be helpful.

4.53
The Council and Auckland Transport have been looking for ways to provide local discretion. One example is a $10 million transport fund that has been established for local boards to propose and prioritise roading amenity improvements that are not already identified in Auckland Transport plans, However, doubt was expressed about what this initiative could achieve because the funding is not additional. It involves reprioritising other work, and Auckland Transport will continue to approve and manage proposed projects.

4.54
CCOs are working through local boards to engage with, and get input from, community groups. It was seen as more efficient for CCOs to put effort into their relationships with local boards than to try to duplicate a local board's connection with, and insight into, the wider community.

4.55
Guided by the Auckland Plan and local aspirations, area plans are being developed to provide a long-term vision for each local board area.

4.56
The Council is building new ways of carrying out consultation appropriate to its regional scale that should result in large volumes of feedback and submissions. It is looking to use group and facilitated feedback techniques for consultation – for example, by running hearings on regional issues while organising workshops for CCOs and local boards.

Our observations – empowering two-tier governance

4.57
The Council needs decision-making processes to ensure that the governing body and local boards can make decisions that:

are informed by good information;
are prudent and have regard to the long-term interests of the Council and the well-being of the Auckland region;
include input from those affected by, and interested in, decisions;
are transparent, allowing scrutiny of the issues being considered, the information and considerations relevant to those decisions, and the decisions being made; and
are effective and efficient, in that the information and processes used for decision-making should be in proportion to the significance of the decision.

4.58
The Council's decision-making needs to take account of local needs and interests, of regional development, and of co-ordinated functional governance. These tensions cannot be resolved simply by design. Inevitably, they are negotiated and renegotiated in day-to-day service delivery activity and decision-making. The service priorities and financial position and operations of the Council need to be broadly understood and supported by the two governance tiers.

4.59
We observed that everyone is committed to making the governance relationships work as best they can. However, some of current confusion and negotiation about roles is resulting in individual elected members' behaviour being misconstrued or misunderstood. Given the workloads of elected members, understanding is needed of the practical constraints that people are working within. Ways need to be found to strengthen governing body and local board working relationships.

4.60
We were concerned about the "wall" of reading material that governing body and local board members are expected to master. Governing body members probably get more to read than is humanly possible in the time they have available. Council staff are giving thought to how elected members can be enabled to consider the issues before them, including providing better, shorter reports to elected members. Approaches similar to those used by the Cabinet Committees of central government are being developed. We consider these approaches to be sensible, if not essential. The structure of local board agendas could be improved to:

give a greater sense of why papers are included in agendas;
tailor content so that it focuses on issues and content relevant to each board; and
be clearer about the input or decision required from the board.

4.61
We suggest that the Council consider how best to support governing body members' activities, such as research and analysis for their decision-making and constituency responsibilities.

4.62
It does not seem possible for the Council to conduct public consultation and "hear" submissions in the way that many local authorities have done under the Local Government Act 2002. For the Council to build the new techniques of community input that Auckland City's scale requires, a review of the consultation provisions of the Local Government Act might be needed. The Council should liaise with the Department of Internal Affairs to ensure that legislation does not preclude practical responses that the Council could use to effectively manage public consultation in Auckland.

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