Responsibilities of central government versus local governments

March 19th, 2012
Ron Nuttall

The new Minister of Local Government Dr Nick Smith has stated that he is concerned about the rising rate take of Local Government and will place restrictions on the excessive borrowing of Local Councils.

Many of the rising costs of Local Government over the past 20 plus years has been caused by changes made by Central Government and the many many previous Central Government (taxpayer) responsibilities that have been past over to the Local Government and are now a cost on the ratepayer.

I believe that in the near future we will see changes that will eventually make Local Government and therefore all the public, responsible for much if not all the present Central Government responsibilities within a Local Council Boundaries.

It's called gradualism. Pass responsibilities and therefore cost over to the ratepayer until they can't take any more and then offer them relief by making more changes but this time changes that will extend some costs to the wider community. A change that the ratepayer can't afford to refuse.

So how will Dr Smith achieve savings to the ratepayer?

Will he take back the responsibilities that Central Government previously passed over to Local Government and relieve the ratepayer of that burden?

Maybe Dr Smith will make a decision as to which services of Local Government are Core Activities and restrict rate monies to these activities and that Non Core activities be the responsibility of those that request this additional activity under the understanding of User Pays.

Then again it's more than possible that Central Government sees the time is now right to transfer even more responsibilities from Central Government to Local Government. With such changes we will see the granting to Local Government the right to place a separate tax on sales and purchases within the Local Governments district boundaries.

This may well begin with a tax on only one item, for a single purpose, as an example, a tax on fuel purchased within the district and to be used for roading within that Local Governments district boundaries. A Local Government District Tax. LGDT. This will include the right to increase this tax as more Central Government responsibilities are past on to Local Government. Each Local Government will be responsible for making tax decisions within their own district boundaries.

Eventually the full responsibilities past over to the Local Government will include, health, education, police and welfare/employment

Don't be one of those that say, this will never happen here because - because we have all heard that said before.

Comment by Daryl:
[Posted 18 April 2012]

Have a look at www.goldenbay.gen.nz, their plan is to form their own council, the Motueka community may want to jump on this.

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