Supercity contracts out democracy to the private sector

The dangers in the ACT/National coalition agreement are becoming clearer by the day.

The agreement goes well past maximising ACT’s 3.5% electoral support. As part of the arrangement ACT Leader Rodney Hide got himself one of the most influential cabinet roles as Minister of Local Government ahead of the development of the so-called Auckland supercity.

Up till now the focus on democracy has been how the councillors will be elected. Firstly ACT vetoed guaranteed Maori representation on the council but supported the proposal for eight councillors to be elected at large alongside just 12 elected from local wards. This proposal was eventually defeated as it would have given huge preference to the electoral grouping with the most funds and therefore greatest ability to campaign across the region. In Auckland’s case this is the ACT/National/business lobby which campaigns as Citizens and Ratepayers.

The focus has now shifted to ACT’s most audacious attack on local democracy.

The new structure proposes seven CCOs (Council Controlled Organisations) to run 75% of Auckland’s local body services leaving elected councillors to twiddle their thumbs on the sidelines.

The directors of each CCO would be appointed, initially at least, by none other than Rodney Hide himself. I’ll leave readers to guess the type of appointees we can expect.

These CCOs will control how the majority of ratepayers money is spent but without democratic accountability. The proposed transport CCO for example will spend over half the new council’s ratepayer income without even needing to publish minutes of its meetings which can be held behind closed doors. Despite what Rodney Hide and Minister of Transport Stephen Joyce assert, there is at best only nominal accountability to ratepayers through CCOs.

A couple of years back I had a personal experience of just how high-handed and arrogant these CCOs can be after a dispute with Metrowater which runs the retail arm of Auckland City’s water supply. I had challenged how the organisation calculated water use for our property but to no avail. The senior management refused to even meet to discuss the issue so eventually I attended a meeting of the city council’s Finance and Corporate Business Committee which had responsibility for Metrowater. I explained our situation and answered questions from committee members who had also received a report from Metrowater on the issue. I asked the committee to require Metrowater to attend mediation to sort out the dispute. A long discussion followed about whether or not the committee was able to require the CCO do so. The council Chief Executive said it was not legally possible for the council to interfere in Metrowater’s management of the business.

Eventually the majority of the committee took my side and voted to recommend the CCO agree to mediation. This was as far as they were allowed to go but I assumed the moral weight of the council sub-committee would get Metrowater to the table even if the council lacked the legal authority to require this CCO to do so.

How wrong I was. Metrowater wrote to me following the council recommendation and flatly refused to attend mediation. In an act of unaccountable corporate arrogance they gave me and the council committee the fingers. It was only after publicity that Metrowater eventually agreed to sort it out.

The proposed CCOs are also the organisations which will hold most of the $28 billion of Auckland’s local community assets and we can expect them to work hard to prepare these assets for privatisation. Auckland Regional Council Chair Mike Lee says these CCOs could “…set up companies, sell assets and enter into major financial commitments without the approval of Auckland Council, even where the transactions may leave the council with significant liabilities or commitments”.

All this would be done by unelected directors without democratic accountability. Our local body democracy is being contracted out to those who will do the bidding of business. The transport CCO for example will have roads, roads and more roads as their top three priorities while public transport will again be sidelined.

The government is backing Hide with National’s Minister of Transport Stephen Joyce working alongside the ACT leader to force these proposals through.

Joyce is best remembered as the National Party campaign manager at the 2005 election who co-ordinated the secret Exclusive Brethren support for National’s campaign to have Don Brash elected Prime Minister. We can’t expect much respect for democracy here.

These ACT/National proposals are so extreme that even the Auckland Chamber of Commerce and mayoral candidate John Banks have expressed reservations so they don’t get caught on the wrong side of the debate when a significant public backlash develops.

It’s a case of the ACT tail wagging the Auckland supercity dog and dog is as good a term as any to describe what would pass for local body democracy under these proposals.