Royalties only fair for communities in the regions

8 February 2013

Local Government New Zealand today welcomed New Zealand First’s Royalties for Regions (RFR) policy announced this week.

The policy would see 25 per cent of royalties the Government collects from mining, fracking and similar activities directed to councils in special regional funds to be spent on community projects.

“This is the type of approach LGNZ has been advocating for,” LGNZ President, Lawrence Yule, says.

“Ensuring the companies earn what is called their ‘social licence to operate’ is important. It’s essential communities in which these companies operate directly benefit from economic activity carried out on their home turf. These industries sometimes bring a degree of economic uncertainty as well as jobs. The ups and downs of the market mean that companies come and go. Sometimes workers move with them, but many don’t. Many people, including parents, put down roots.

“These industries often have a very significant impact on local and regional economies and other businesses are set up to service them. If they go, the financial fallout can be significant.

“In addition to robust environmental protections, communities need a solid financial stake to at least help offset the uncertainty of some enterprises,” Mr Yule said.

ENDS

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