Transport and local govt reforms at odds over 'well-beings'

BUSINESSDESK: An overhaul of the aims of local government, stripping its role back to core functions, may require changes to the Land Transport Management Act (LTMA) which contain similar, lofty aspirations for kiwis' social, cultural and environmental well-being.

The Local Government Act Amendment Bill would remove councils' requirement to consider their citizens' "social, economic, cultural and environmental well-being" in a move aimed at curbing hikes to rates and services charges.

Cabinet agreed to the new purpose in March and the bill is before select committee and faces opposition from local governments.

"Both Acts deal with allocation of land transport funding and some degree of alignment in their purposes is desirable," Greg Mossong, principal adviser at the Ministry of Transport, says in the covering note for a regulatory impact statement (RIS) for the LTMA review.

Central and local government overlap on land transport because they both contribute – about $3 billion a year from government and $1.5 billion from local authorities. Transport Minister Gerry Brownlee says the Land Transport Management Amendment Bill is aimed at streamlining the funding processes and cutting red tape.

The LTMA's current purpose is to "contribute to the aim of achieving an affordable, integrated, safe, responsive and sustainable land transport system". 

But in May last year, Cabinet agreed to change the purpose to "contribute to an effective, efficient and safe land transport system that supports New Zealand's economic, social, cultural and environmental well-being".

"The proposed changes to the Local Government Act purpose agreed by Cabinet in March 2012 do not align well with the proposed Land Transport Management Act changes agreed in May 2011," the RIS says.

The Ministry of Transport consulted widely with other government departments on four options to tweak the LTMA amendments.

Feedback from the Ministry for the Environment and Ministry of Health was that transport has wider impacts beyond economic efficiency and the purpose of the LTMA should include reference to environmental, social and health objectives.

The preferred option in the RIS is to change the wording in the purpose of the LTMA amendment so that it refers to "the public interest" rather than the wider reference to "well-beings".

"The values embedded in the term 'well-beings' have proven controversial and the government is moving away from that term in the local government context," the RIS says.

The Ministry of Transport did not support an option that would make the wording of the LTMA similar to the local government amendment of providing core functions "at the least possible cost to households and business".

That is because it "lacks sufficient reference to the wider impacts of land transport investment on society", overlooks the concept of safety and "does not adequately recognise the nature of the rationing decisions needed in allocating a limited pool of land transport resources", the RIS says.

Many submissions on the Local Government Act 2002 Amendment Bill also question whether similar proposed changes to definitions are clear enough in their intent.

Parliament's local government and environment committee is considering the local government bill, which had its first reading in June, and is due to report back on November 5.

The Land Transport Management Amendment Bill 2012 was introduced to Parliament on August 13 and is expected to pass into law in the first half of 2013.