Sunday 26th April 2009: Q+A’s Guyon Espiner interviews Local Government Minister, Rodney Hide.

Points of interest:
- Government views Auckland assets as state assets, so they won’t be sold in National’s first term
- ACT Bill to cap all local body rates will be before Parliament in September: Mayors “almost as one” oppose it, National “keen to have a look at it”
- ACT has delayed its Taxpayers’ Rights Bill back from “within six months” of the election to 2010
- Hide committed to cutting “billions of dollars” from Government spending
- Hide: “I think we have got a great deal of overlap and confusion within Cabinet… needs a tidy up”

The interview has been transcribed below. The full length video interviews and panel discussions from this morning’s Q+A can be seen on tvnz.co.nz at,
http://tvnz.co.nz/q-and-a-news

RODNEY HIDE interviewed by GUYON ESPINER

GUYON Rodney Hide thank you very much for coming in and joining us on Q&A this morning.

RODNEY HIDE – Local Government Minister
Thank you for having me.

GUYON The Super City, one Mayor, one city managed as one city, you’ve pretty much got your way haven't you?

RODNEY Oh I don’t think it's about me getting my way, I'm thinking it's a much bigger issue than that, it's certainly about getting the best governance for Auckland and I think it's clear that Aucklanders are looking forward to having one mayor one city but the key thing and we've got his loud and clear is local representation and what I'm excited about is that Aucklanders want to be engaged in the style of governance and so we've got an interest in local body politics in Auckland that we haven't seen for years.

GUYON So the opposition from the likes of Waitakere's Mayor Bob Harvey is that just patch protection do you think?

RODNEY No I don’t think it is, I don’t think that it is even opposition to be honest, you can understand concern, people that have been involved in local body politics for a long time, given it a lot, they're obviously concerned about any proposal for change and what I've been promising and what I've been doing is engaging with them to get the best result for Auckland, and getting the best result for Auckland also means getting the best result for Waitakere.

GUYON One of the things I'm concerned about is the transfer of assets to the Super City, for example they have I think about 360 pensioner units that they’ve invested in, they’ve preserved, they believe they're important to their region, I mean these could be transferred to the Super City in fact will be and they could be flicked off by a Super City Mayor like John Banks couldn’t they?

RODNEY Well they could be because I'm not in a position to say – make decisions now for binding a future Mayor, but these are the issues that I'm working through with the various mayors.

GUYON But you would see that as quite a possibility.

RODNEY Look anything's a possibility in the sense that I want to have a mayor and a council elected that can actually make decisions for Auckland, they're not gonna be decisions that Rodney Hide wants or decisions that Bob Harvey wants or decisions that John Banks wants, what they are gonna be is we're gonna have an intense process establishing a new good governance model for Auckland not just for the next election and the next three years but actually for the next probably 50, 100 years important, not just that we get a good outcome there but we get a good process establishing that outcome and then let's actually elect a mayor and a council that can make decisions for Auckland.

GUYON Sure but one of those things that they’ve got, I mean you’ve got roughly 28 billion dollars worth of assets that are going to be transferred to the Super City. Do you envisage those remaining in public ownership?

RODNEY It won't be for me to decide that, it'll actually be up to the council and to the people of Auckland.

GUYON Is it a factor to be considered though, is it simply just wash your hands of it and ...?

RODNEY No it's not about washing my hands of it, my responsibility is clear, my responsibility as Minister is to write a good governance structure for Auckland and therefore allow Auckland to make their decisions, that’s what I'm trying to do, I think everyone has agreed the governance structure that we have for Auckland has been poor, has been fragmented and we're left with actually good people frustrated and unable to make a difference.

GUYON Sure I'm aware of the structural thing but the Royal Commission itself makes some judgements and recommendations about ownership, for example it says all the water assets should be transferred to Water Care services Limited and that they should remain in public ownership/

RODNEY And the government has agreed with that decision.

GUYON Okay what about a couple of other specific ones like Ports of Auckland, that'll be 100% owned by this council.

RODNEY I can tell you this, you know my view of that, I'm always in favour of more private ownership and commercialisation, but I can tell you this government under John Key is very firmly against that, I've accepted that, that’s the government's decision that’s the people's view, again I'm making the point that my job is to provide the very best governance for Auckland.

GUYON Sure, before I move on from that point, so you see those as state assets that would come under that guarantee of not being sold?

RODNEY Well the Prime Minister's made it clear to me yes.

GUYON The Airport shares are 22% that currently Auckland City Council and Manukau have in the Airport and 100% in the Port.

RODNEY They’ll certainly be a decision that'll be made by councils you know over the next 50 to 100 years they're not gonna be a decision made by me in the next 12 months.

GUYON Can we move from local government to central government and the central role of central government which is how governments spend our money. Under the confidence and supply agreement that you have with National signed up in November, National agreed and I quote the document here, they have agreed to send to Select Committee within six months a bill the Taxpayer's Rights Bill with the aim of passing into a law a cap on the growth of Crown core expenses, so basically a cap on government spending, what sort of progress are you making with that?

RODNEY Good progress though what I have done is I've gone to Bill English and I initiated this, and I've got the Treasury very busy on some work on the Regulatory Responsibility Bill that’s also in our agreement and of course we have the Treasury busy putting a budget together, and I said actually let's delay that and put it into next year when we actually have more time for the officials and that’s been agreed to.

GUYON Right so that’s because the coalition agreement, the confidence and supply agreement said within six months but you’ve pushed that back now?

RODNEY I've pushed it to next year and the reason being is that we've been so busy with our Regulatory Responsibility Bill and the work of the officials in terms of getting the budgets under control, because we did have a big problem that actually I initiated, it wasn’t that Bill English came to me, I said actually let's push that out, we made the decision to have it within the first six months let's actually do it the following year.

GUYON Wouldn’t that a top priority though, if spending is getting out of control to actually have this ...

RODNEY Certainly but I've been impressed, I've been sitting on the Cabinet Committee with Bill English that’s looking at government spending and I didn’t have high hopes for that committee but I've been very impressed with the way Bill English has gone about it and the other ministers, I think it's very clear to every minister and certainly clear to the public that we are in tough times and so there is an enthusiasm for looking at expenditure and ways that it can be reduced, so there is actually a process in place to get spending under control. I would like to see core expenditure capped and taxpayers able to have a say, and I'm looking forward to having that debate next year.

GUYON I want to come back to the quality of spending in a minute but the other thing that you wanted to cap was rates, you wanted a cap on local government ability to actually raise rates.

RODNEY Still do.

GUYON What progress are you making with that?

RODNEY Good progress, I've got the Auckland decision you know under way, the substantial bill for Auckland will be coming before parliament in September this year, I've also got work under way and this again has been an interaction not just with Auckland but with right around the country with local councils, producing grater if you like transparency and accountability in local government.

GUYON But will we have a cap on rates?

RODNEY I'll be proposing that we actually have an ability for ratepayers to put a cap on core local government expenditure yes.

GUYON Has National said that they will back that?

RODNEY No but they're certainly keen to have a look at the argument just like they are at central government level.

GUYON So where is that argument with them, are you still having to try to convince them of the merits of this?

RODNEY No not at all, what I'm doing is working with officials, I'm putting together the proposals, I've been discussing it and debating it, I have to say the local body politicians almost as one are opposed to it and so I'm engaged with that discussion and developing the work in order to put the argument.

GUYON This whole idea of the Taxpayer's Bills of Rights it's actually taken from Colorado isn't it, even the name.

RODNEY Yes.

GUYON Now the critics say it's been a disaster there and in fact they’ve taken a five year holiday from this because public services have got so run down.

RODNEY Yeah but don’t forget that was an agreement that they had and the ratepayers if you like or the taxpayers of Colorado agreed to it and that’s I think as it should be, so within the Colorado Taxpayer Rights Bill what it said is that if you are going to increase your expenditure you actually need the taxpayers' and the ratepayers' consent and over time it was always expected that that would be granted, it wasn’t inevitably granted, but what it does is put them in the box seat and I think that’s important, I think one of the frustrations that people have had with local government and central government is actually their powerlessness and why shouldn’t they have a say, I'm quite happy for rates to go up and up and up if ratepayers agree with it, what I'm not happy with is the idea that you can just come along and put up rates and to hell with the pensioners, to hell with the people that have to pay them, I think they should have a say, the same with central government why shouldn’t taxpayers have a say, it's their money.

GUYON You talked before about being on the Cabinet Committee which controls expenditure, what sort of targets do you have in terms of cutting government spending?

RODNEY Well me personally I have rather ambitious targets.

GUYON What are they?

RODNEY Oh look I think we could get government down easily to 25% of GDP.

GUYON So it's currently at about a third.

RODNEY That’s right.

GUYON So you're talking about billions of dollars cut off government expenditure?

RODNEY That’s right, and I believe over time you could, now that is not shared by the National Party.

GUYON Is that the aim that you go into that Cabinet Committee with, as you sit round going through the lines looking at that?

RODNEY No, but you asked me what my view was, and my view is that we're massively overtaxed, there's massive over expenditure, they're decisions that government's are making that we would be making ourselves. What I go into that Cabinet Committee with is if you like with a partner working with Bill English and the other ministers, I have to say the first thing has been to get to grips with what's going on. I've been quite stunned at if you like the amount of expenditure that had been agreed to for which there's no money.

GUYON And you say that, I mean you said at your ACT Party conference that government spending's grossly excessive, I mean what are some of the examples, you said that sitting on that Cabinet Committee and I quote you here, shows just how out of control government spending is, can you give us an example?

RODNEY Sure, I was stunned to learn that between 2002 and 2006 central government added another 1,256 policy analysts, that’s not total that’s in addition and if you talk to Ron Mark I think that’s a battalion.

GUYON So are they gonna go?

RODNEY No, because I'm not in charge, if I was Minister of Finance, if I was Prime Minister I'd be saying actually I don’t think the country can afford all these people.

GUYON Well what influence are you having, one of your core principles is limited government, what influence are you having on that committee to get rid of programmes that are grossly excessive and we don’t need and what are they?

RODNEY Well I'm having about 3.65% of influence which is how much vote that ACT got and I'm exercising that, I don’t sort of go in there and say it's my way or the highway or anything like that, what I've been impressed with and I think this comes from the Prime Minister John Key is an ability to sit down and discuss it and actually hear the arguments, we put up our proposals, we've got some policy agreements and we're busy implemented them and I think we're having some success.

GUYON Do you believe that you’ve stuck to your principles though?

RODNEY Certainly.

GUYON Because one of your core principles of limited government, one of the examples of that is that you wanted a cabinet of ten or twelve and then you accept a deal where your Minister Heather Roy is the 25th ranked minister and for the first time that I can remember we have an Associate Defence Minister, I mean isn't that just showing that you will compromise your principles when it's politically expedient to do so. Do we need an Associate Minister of Defence, can you honestly say this morning that we need an Associate Minister of Defence?

RODNEY We certainly need Heather Roy having an input in there.

GUYON Do we need an Associate Defence Minister?

RODNEY I think you'll find when you speak to the Defence Minister Wayne Mapp that Heather Roy's making a valued contribution. Do we need 26 ministers which I think is what your question is, my answer is not.

GUYON So why did you sign up to a deal where you're one of them?

RODNEY Well what I could do is do a sacrifice and say well okay I think we could get by with 24 and actually send myself and Heather Roy into the wilderness and then I'd actually be betraying the people that voted for ACT and said actually we want ACT having a say in this and so we're making a contribution, like I say if I got the votes to be Prime Minister or Minister of Finance then we could start looking at it and I think we have got too many ministers, I think we have got a great deal of overlap and confusion within Cabinet that was bequeathed to us from the previous government, I think it does need a tidy up, in fact much of Cabinet is sort of the same problem that we have with Auckland where there's overlapping responsibilities, unclear accountabilities and a lack of transparency in the process, I think you could do a lot better with less ministers.

GUYON And fewer government departments too, you’ve talked in the past.

RODNEY Yes, much fewer, in fact you have government departments that people have never heard of.

GUYON You’ve talked about Youth Affairs, you’ve talked about Pacific Island Affairs, you’ve talked about Economic Development that all can get rid of, Consumer Affairs we could get rid of that too?

RODNEY Well what we've got is, we've got a Minister of Consumer Affairs in Heather Roy and she's actually reorientating Consumer Affairs because Consumer Affairs used to always be about going around bossing businesses and telling them what they had to put on labels and how they had to do things and therefore putting the costs up to consumers. What we have with the Minister of Consumer Affairs Heather Roy now is someone that’s actually standing up for consumers and saying actually it's about getting prices down for ordinary New Zealanders and for households and getting the quality up, that’s what Consumer Affairs should be about, and don’t forget that the ACT Party stands for the Association of Consumers and Taxpayers, so we've got a minister standing up for consumers and myself standing up for taxpayers, that’s not bad.

GUYON When the election had just been held in fact the night after you said that John Key was on many issues well to the left of Helen Clark, do you stand by that?

RODNEY Yeah I do, I mean I think that John Key is a centrist, I think that John Key is managing New Zealand, I think he's been great to work with but he certainly isn't if you like an ACT politician.

GUYON And do you view him differently now than ...

RODNEY I do, I don’t view him differently on policy, I think that John Key on policy is a centrist, I think on some of the decisions he's made he is to the left of Helen Clark, but he has impressed me as a manager and as a person able to set bit goals and he has certainly impressed me as a man with the capacity to get the best out of a team and I think I'm very privileged to be able to work with him, I have been amazed by him.

GUYON A good place to leave it, thank you very much for coming in and joining us this morning Rodney Hide.

ENDS

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