Better Democracy NZ is a non-partisan, non-profit organisation.

Our mission is to foster the improvement of New Zealand's democratic system and encourage the use of direct democracy through the

Veto, Citizens' Initiated and Recall referendum.


Friday, 13 November 2009

Hide: No need for referendums

Following is a press release by Rodney Hide, Minister of Perks & Local Government.

Rodney Hide28 October, 2009

Reforms to help keep rate rises under control

Local government reforms agreed by Cabinet this week will give ratepayers more say in how councils spend their money, Local Government Minister Rodney Hide said today.

"The reforms are about local government focussing on core functions, managing within a defined budget, and adopting transparent and accountable decision-making processes," Mr Hide said.

"These changes to the Local Government Act 2002 will ensure that council costs, rates and activities are better controlled. The decisions taken by Cabinet this week represent significant progress towards better local government, and easier and more effective participation by ratepayers and residents in the activities of their councils.

"Ratepayers want and need greater confidence in their councils, and to have access to better, more easily understood information about the spending and performance of their councils - these reforms will enable that to happen.

"The changes will deal with some of the concerns which led to calls for greater use of referendums in local government. As a result Cabinet has decided to leave the present powers of councils to call polls and referendums unchanged."

The reforms include:

Councils being encouraged to focus on core services by amending section 12 of the Local Government Act (the power of general competence) to require councils to have particular regard to the importance of: infrastructural services; solid waste services; hazard and disaster management; libraries and recreation; culture and heritage services; and the performance of regulatory responsibilities and statutory duties

Simplifying council planning by merging the community outcomes process into the long-term council community planning process

Requiring councils to provide ‘plain English' financial reporting

Pre-election reports that draw together existing council information in a readily accessible format and timely manner to help promote election debate

Analysis of 2009-19 Long Term Council Community Plans shows that councils' operating costs will increase 39 per cent over the next 10 years. Over the same period councils' planned capital expenditure will total $31.4 billion, and total debt is forecast to rise to $10.8 billion.

Mr Hide said legislation to enact the reforms is expected to be introduced to Parliament before the end of this year.



Anonymous said...

Widespread publicity on the cost effectiveness of councils like Wanganui who practice referenda and those who don't is the most practical way of increasing pressure from ratepayers for their local council to adopt referenda. Goodness we may even see candidates standing for election with referenda as their stated policy and if elected who knows what benefits may result

Steve Baron said...

Budget referendums and government spending:evidence from Swiss cantons was a University study by Professors Lars Felda & John G. Matsusaka. It showed how referendums can reduce government spending by up to 19%. See the abstract below or for the full study click here


In many Swiss cantons, new government programs must be approved by a referendum of citizens before money can be spent. Referendums seem like a natural way to address citizen–legislator agency problems, yet statistical evidence on how referendums affect spending decisions is almost nonexistent. We estimate regressions for Swiss cantons using panel data from 1980 to 1998 and find that mandatory referendums reduced government spending by 19% for the median canton after controlling for demographics and other determinants of spending.