Brian Fallow writes in NZ Herald:

Local Government New Zealand and the New Zealand Initiative are calling for more public services to be provided by local government and funded by local taxes.

At least they would like to see a debate about whether the split between the responsibilities of central and local government is optimal.

executive director said New Zealand was an outlier among developed countries in having so small a share – 11 per cent – of total government spending undertaken at the local level.

The OECD average for spending by levels of government below central government was 30 per cent, he said, and only Greece and Ireland were more centralised.

We are unusual in having only two tiers of Government – central and local – no provinces or states. Now that I advocate that.

chief executive Malcolm Alexander said a greater devolution of real authority to local government might encourage greater participation by the public, pointing to reports that in the local body elections now under way only 10 per cent of eligible voters in Auckland have voted so far.

The Swiss Ambassador spoke at an event last night on this topic. She mentioned that in Switzerland all powers started with the cantons etc and over time they decided what to hand upwards to the Federal Government, such as currency and military. In NZ all power rests with central Govt and local government is a creation of central government.

While attracted to the idea of local income taxes, Hartwich stressed that he was talking about re-allocating tax between central and local government, not an overall increase.

Absolutely. I have some attraction to the idea of taxes rather than rates to fund local government. Rates increases are only paid by home owners and businesses (directly) and any increases are often hidden by the fact your house’s value may have changed. I suspect it would be harder for a local Council to increase a local tax rate than it is to increase rates.

Hartwich has a paper on localism here.

also spoke last night and made some great points on the resilience of local communities and how locals care far more about local outcomes than officials in Wellington, and spoke about some of the pilots around the Waikato where some local initiatives are achieving great things.

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