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LGNZ Invite Discussion On Councils’ Finances

Press Release – Local Government NZ

Local Government New Zealand (LGNZ) is inviting the New Zealand Maori Council to have an open-book discussion on the financial positions of five councils, to set right the misguided impression that they are potentially insolvent. This is in response …

Local Government New Zealand (LGNZ) is inviting the New Zealand Maori Council to have an open-book discussion on the financial positions of five councils, to set right the misguided impression that they are potentially insolvent.

This is in response to New Zealand Maori Council Executive Director Matthew Tukaki requesting that the office of the Auditor-General intervene and audit the finances and management of the Far North District Council, Gisborne District Council, New Plymouth District Council, Tauranga City Council, and Western Bay of Plenty District Council.

“While communities are certainly under pressure across New Zealand due to the impact of Covid-19, and this in turn has affected the financial positions of the five councils, it’s too far a stretch to conclude that they are in trouble,” said LGNZ President Dave Cull.

“We know this because of the numerous independent checks and balances that are already in place when it comes to council finances.”

“All councils are audited annually by the Audit New Zealand on behalf of the Auditor-General, a long-standing practice that, somewhat ironically, is exactly what Mr Tukaki is calling for.”

“In addition, the councils in question are either members of the Local Government Funding Authority and CouncilMARK™, or both. Neither of these independent bodies, which provide assessment and monitoring of councils’ finances, have raised any red flags.”

“In fact, many of the councils in question are on a stable financial footing, with sufficient resources and debt headroom on hand should they need it. This is a reflection of the prudent financial decision making that LGNZ has long promoted among its members.”

“We appreciate that council finances and oversight mechanisms can sometimes be challenging to interpret from the outside looking in. That is why we welcome a further discussion with Mr Tukaki and the Maori Council to assure them that councils are committed to best practice financial management and independent oversight in the interests of their communities.”

CouncilMARK™:

This is a programme designed to improve the public’s knowledge of the work councils are doing in their communities and to support individual councils further improve the service and value they provide. The programme incorporates an independent assessment system that assesses how councils are performing and the work they’re undertaking to grow the value they deliver. Councils receive an overall performance rating from an Independent Assessment Board and commentary on their performance.

Local Government Funding Agency:

The LGFA is a Council-Controlled Organisation (CCO) operating under the Local Government Act 2002. LGFA specialises in financing the New Zealand local government sector, the primary purpose being to provide more efficient funding costs and diversified funding sources for New Zealand local authorities. LGFA was established to raise debt on behalf of local authorities on terms that are more favourable to them than if they raised the debt directly.

Audit New Zealand:

Audit New Zealand carries out annual audits of hundreds of public entities on the Auditor-General’s behalf to give taxpayers and ratepayers assurance that public entities are appropriately reporting on how they spend public money and on the services they have provided.

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