Response to Simplifying Local Government Proposal
Response to Simplifying Local Government Proposal 20.02.26
The Proposal states that “The Government has developed a proposal to make local government simpler, more efficient, and better value for money.”
From a value-for-money perspective, I do not yet understand the analytical basis for this reform. Drawing on my experience supporting public investment reforms nationally and internationally, I have three observations:
1. Strategic Context – It is unclear why this reform is necessary now. What justifies structural intervention at this time?
2. Case for Change – The proposal does not clearly articulate the core problem being solved or the long-term vision being pursued.
3. Economic Analysis – The full range of options considered has not been presented. Why have alternative approaches — including strengthening capability within the existing system — not been evaluated alongside structural change?
I spent five hours attempting to answer these questions; summarised in the appendix below.
Communities
A recurring theme in the proposal is the importance of community representation and voice in decision-making. In Newlands, Wellington, we are working with residents to measurably strengthen economic, social, cultural, and environmental resilience. This includes implementing a practical disaster-resilience model and creating structured mechanisms for informed community voice in public decision-making. In my experience, durable public value is not driven by structural change alone, but by disciplined decision systems, strengthened capability, and empowered communities able to contribute constructively in the decision-making process.
Suggestion
Before proceeding with structural simplification, I recommend that Government provide a proposal, including other options for community representation and voice in decision-making, that clearly sets out:
· The strategic context for reform
· A robust case for change
· The full range of options considered (including capability-strengthening alternatives)
· A transparent economic assessment identifying the best public value option
· Clear funding implications and who bears the cost
Strengthening communities and the quality of decision-making should precede structural change.
Rodney Barber
Public Investment & Public Value Steward | Director, Rodney Barber Associates and architect of Better Decisions Better Outcomes | Chair, Aotearoa Community Resilience Network charitable trust.
APPENDIX
STRATEGIC CASE
Strategic Context
This year will include many changes
o The Prime Minister’s recent address reflects a necessary central-government, state-led decision system. It is macro and institutional in focus—grounded in rules, incentives, fiscal discipline, and structural reform—and designed to stabilise and grow national systems such as the economy, education, law and order, infrastructure, and trade. This approach establishes confidence and creates the conditions for long-term growth.
o Government programme including repeal and replace the Resource Management Act 1991 with a modern planning system for them to be passed into law in 2026; simplifying Local Government, a major restructuring of regional governance; New Ministry of Cities, Environment, Regions and Transport to bring together Ministry for the Environment, Ministry of Housing and Urban Development, Ministry of Transport and local government policy functions from the Department of Internal Affairs.
o The Finance and Expenditure Select Committee’s renewed focus on performance reporting and public accountability.
o The Governance and Administration Select Committees focus on emergency preparedness following recent severe weather events.
o New Councils elected last year and about to enter their Long-Term Plan (LTP) processes under time pressure, facing fiscal constraint, carrying legacy commitments, nervous about consultation overload, trying to align with new national direction (RMA reform, infrastructure focus, resilience), and communities, meanwhile, are tired of being “consulted”, unsure what influence they really have, worried about costs, services, and resilience, and often reactive rather than organised
o The Government’s self-assessment against the International Monetary Fund’s Public Investment Management Assessment (PIMA) highlights poor integration between central and local government in planning, prioritisation, and investment decision-making, and misalignment between national strategy, funding signals, and local delivery realities. The Government’s response is focused on improving asset management guidance, business case quality, performance reporting, and investment expectations
One of the above changes is Simplifying Local Government, a major restructuring of regional governance to move from many locally driven, slow, and fragmented decisions to fewer, faster, regionally coordinated decisions that reliably deliver housing, infrastructure, and environmental outcomes.
Case for change for Simplifying Local Government
Objectives, Current state and benefits
There are four types of objectives summarised below together with a description of the current state and what is needed to achieve each objectives:
1. Effectiveness – enabling coherent and timely decision-making
Objective: To improve the effectiveness of regional governance
Current state: Fragmented governance arrangements contribute to unclear responsibility, misaligned decisions, and delays, which in turn constrain the ability of the system to support consistent delivery and long-term outcomes.
Need: Clarify responsibility in ways that support more timely and coherent decision-making across interdependent policy areas.
2. Efficiency – simplicity and coordination
Objective. To improve the efficiency of local government by reducing unnecessary complexity and improving the coordination of regional decision-making.
Current state: Overlapping council structures create duplication of roles, fragmented capability, inconsistent rules, and burdensome processes for communities, staff, and regulated parties.
Need: A simpler system to navigate, and enables smoother interaction between governance bodies and service delivery.
3. Economy – cost and overheads
Objective: To improve the economy of local government by reducing avoidable costs and overheads.
Current state: Multiple governance layers and competing mandates increase administrative, staffing, and compliance costs without corresponding improvements in outcomes.
Need: A system that limits avoidable costs and redirects capacity toward core functions and service delivery.
4. Standards – democratic legitimacy and representation
Objective: To improve governance standards by strengthening democratic legitimacy, and fair representation of diverse communities of interest.
Current state: Low public understanding of regional governance, uneven electoral engagement, and concern from smaller or distinct communities about influence and visibility weaken confidence in the system.
Need: Governance arrangements that are understandable, transparent, and perceived as fair, while recognising both population-based representation and the interests of distinct communities.
Benefits of achieving objectives
If we improve the effectiveness and efficiency of regional governance, reduce avoidable costs and strengthen democratic legitimacy, and fair representation of diverse communities of interest the benefits based on the Treasury Living Standards framework could be
· Improved trust in public institutions and greater civic participation,
· Reduced stress and uncertainty for staff, communities, and regulated parties navigating the system.
· Stronger institutional trust, legitimacy, and perceived fairness across regions, particularly for smaller or distinct communities whose voices are often marginalised.
1. Reduced administrative and compliance overheads
2. Clearer environmental management, improved climate adaptation planning, and reduced conflict between regulatory bodies.
Risks to achieving objectives
The key risks to achieving the objectives are as follows together with how they could be mitigated:
1. Misaligned strategic direction. If central government does not provide a coherent and stable long-term strategic direction aligned with regional and local priorities, evidenced by frequent policy resets, weak problem definition, and inconsistent mandates to councils, then simplified regional governance will not translate into more coherent or effective decisions, mitigated by explicit cross-system strategy alignment and shared outcome frameworks agreed before structural change.
2. Poor decision quality and analysis. If central government decision-making continues to be characterised by weak investment logic, thin analysis, and late-stage political overrides, evidenced by repeated findings of poor business cases and implementation failures, then improved regional governance will be constrained by upstream decision failures beyond its control, mitigated by consistent evidence standards, strengthened analytical capability, and transparent decision criteria across agencies.
3. Fragmented NZTA–central–local decision pathways. If NZTA and central government continue to operate with misaligned planning, funding, and accountability settings relative to regional and local government, evidenced by transport investments that conflict with regional land-use, climate, or community priorities, then efficiency and coordination gains at the regional level will be undermined, mitigated by integrated
planning cycles, early joint decision-shaping, and clarified roles across the transport system.
4. Unfunded or poorly sequenced mandates. If central government continues to introduce reforms without clear funding, sequencing, or delivery capacity at local and regional levels, evidenced by persistent cost-shifting and implementation pressure on councils, then cost reductions and efficiency gains will be illusory and service quality risks will increase, mitigated by explicit funding–responsibility alignment and staged implementation tied to capacity readiness.
5. Erosion of democratic legitimacy and trust. If central government proceeds with structural reform without demonstrably improving transparency, engagement, and respect for communities of interest, evidenced by low public trust, limited understanding of governance changes, and perceived marginalisation of smaller communities, then democratic legitimacy may weaken rather than strengthen, mitigated by clear accountability lines, visible representation safeguards, and meaningful community engagement throughout implementation.
6. System overload and center–local disconnect during simultaneous reform. If a strongly centralised, state-led reform programme focused on macro stability, structural consolidation, and accelerated delivery proceeds without equivalent strengthening of local and regional decision quality, integration, and legitimacy, evidenced by concurrent RMA replacement, local government restructuring, machinery-of-government change, heightened select committee scrutiny, compressed LTP timelines, community fatigue, and the Government’s own PIMA findings of weak central–local integration, then reforms may increase speed and control at the centre while amplifying delivery friction, legitimacy risk, and misalignment at the local level, mitigated by deliberate sequencing, capability uplift, and shared planning, prioritisation, and accountability mechanisms linking central agencies, NZTA, councils, and communities.
Constraints to achieving objectives
The key constraints to achieving the objectives are
1. Central control of key funding and approval levers. Major investment decisions (especially transport, climate adaptation, and infrastructure) remain controlled by central government and Crown entities such as NZTA, constraining regional autonomy and limiting the practical impact of improved regional governance.
2. Workforce and capability supply constraints. There is a limited national pool of experienced planners, infrastructure specialists, and governance professionals, constraining the system’s ability to uplift capability even if structures and incentives are improved.
3. Time and cognitive bandwidth constraints. Elected members, senior officials, and communities face finite time and attention, limiting how much complexity, reform, and parallel change can be absorbed without degrading decision quality or public engagement.
ECONOMIC CASE
Status Quo: Fragmented governance with procedural coordination. Regional and local governance is characterised by overlapping scopes, fragmented authority, reliance on ad-hoc procedural coordination rather than integrated decision rights, and delivery through misaligned planning and funding cycles that impede coherent and timely decisions.
To achieve the objectives and benefits whilst being cognizant or the risks and constraints the following options have been identified:
Do minimum – targeted coordination within existing structures
· Scope Limited to high-friction regional interfaces (e.g. transport, regional planning, climate adaptation), with existing local and regional council structures retained.
· Solution Procedural and behavioural changes only: clearer role definitions, shared planning and investment timelines, and mandatory early coordination between local government, regional councils, NZTA, and central agencies for defined decisions.
· Delivery Non-statutory guidance, MOUs, and incremental process changes delivered within existing funding baselines and legislative settings.
Do moderate – consolidated regional decision-making for defined functions
· Scope Regional decision-making consolidated for a defined set of regional matters (e.g. transport prioritisation, environmental regulation, major regional infrastructure), while local councils retain local service delivery and community assets.
· Solution New governance mechanisms rather than full merger: standing regional decision boards or committees, population-weighted representation combined with explicit protections for communities of interest, and a single regional prioritisation process for agreed functions.
· Delivery Targeted legislative change, staged implementation, and pilots in selected regions, with progression tied to capability, performance, and central–regional alignment thresholds.
Do maximum – full regional governance consolidation
· Scope Most regional decision-making is consolidated into a single regional governance body, with significantly fewer elected bodies at the regional level and centralised accountability for regional outcomes.
· Solution Structural reform: a single statutory regional authority with consolidated decision rights, clear accountability, and formal integration with central government and NZTA planning and funding processes.
· Delivery Comprehensive legislative reform supported by a national transition programme, central oversight, and time-bound implementation.
Comparative summary
A comparative analysis of the options
Status Quo: Regional and local governance is characterised by overlapping scopes, fragmented authority, reliance on ad-hoc procedural coordination rather than integrated decision rights, and delivery through misaligned planning and funding cycles that impede coherent and timely decisions.
Do minimum. This option delivers limited improvements in decision coherence and timeliness, achieves low reduction in complexity and only marginal cost reductions, preserves existing democratic legitimacy, carries low delivery and transition risk, and remains highly dependent on changes in central government and NZTA behaviour.
Do moderate. This option provides strong gains in decision coherence and timeliness, achieves moderate simplification with gradual reductions in avoidable costs, balances democratic legitimacy with improved coordination, carries medium delivery and transition risk, and continues to depend significantly on central government and NZTA behaviour change.
Do maximum. This option offers very strong potential improvements in decision coherence and timeliness, delivers high simplification and significant cost reductions after transition, but presents contested democratic legitimacy, high delivery and transition risk, and very high dependence on central government and NZTA behaviour change.
