When Smaller is Better

I recently attended the annual Local Government Conference in Dunedin. A speaker that caught my attention was Jason Krupp who is a Research Fellow at The New Zealand Initiative, who has an extensive background in business journalism both here and abroad.

Jason has given considerable thought to what the ideal size and structure of local government should be in New Zealand, if we indeed want to lift the pace of economic growth and national productivity here in Aotearoa. His key findings were…

  • Highly centralised governance arrangements are not necessary for local, regional and national economic efficiency. Some of the world’s most competitive economies use highly localised forms of government.
  • Competition between local authorities is likely to heighten yardstick comparisons between jurisdictions’ and increase pressure on municipalities to provide services most cost effectively.
  • Effective local governance arrangements follow the principle of subsidiarity, such that local level tasks are best handled by local authorities, and regional tasks by regional authorities.
  • The track record of major metropolitan amalgamations suggest unitary authorities do not necessarily deliver cost or operating efficiencies, and often increase a city’s running costs.
  • Jurisdictions looking to persuade central government to devolve decision making power need to do so from a sound economic evidence base, and have a proven track record of sound local governance.

‘The Local Benchmark: When Smaller is Better” REPORT SUMMARY The New Zealand Initiative

In his presentation, Jason referred to four case-studies.

  1. Manchester in the UK, where after decades of centralising power in London, the government has embarked on a programme to devolve decision-making back to regional authorities.
  2. Switzerland which he suggests is the leading example of localism in practise

The Netherlands that employs some very flexible approaches to decentralised local government that includes public/private partnerships and shared service provision models. And

  1. Montreal a study looking at a metropolitan area that centralised 28 municipalities without democratic mandate only to then unbundle them after a 2003 referendum.

I recommend reading the article at this link https://secure.zeald.com/nzinitiative/results.html?q=When+Smaller+is+better

Judy Turner, UnitedFuture Deputy Leader