$11.8 million spent on review to nowhere
Having called for a Royal Commission into Local Government, I was relatively happy when in April 2021 then Local Government Minister Nanaia Mahuta announced the Future for Local Government Review. A ministerial review wasn’t quite what I was after, mainly because I knew a Royal Commission would likely have more staying power and be seen as less politically slanted in the event of a change of government, but beggars can’t be choosers and I figured there likely wasn’t going to be a better opportunity.
Fast-forward just over three years and one Friday evening the last remnants of the Future for Local Government Review were snuffed out through a press release from now former Local Government Minister Simeon Brown.
In many respects, being quietly put out of its misery in the death zone for news stories was a fitting end for the Review. After all, Labour gave the publication of the Review panel’s final report a wide berth when it was finally published in June 2023. Given Labour knew they were facing an uphill battle to be re-elected, it’s hardly surprising they didn’t hurry to respond to the Review’s recommendations.
Whatever the merits or shortfalls of the Future for Local Government Review’s recommendations, I noticed that one thing hadn’t surfaced at all in relation to it: how much did the 26 month exercise cost?
Thanks to a couple of Official Information Act(OIA) requests I chucked into the Department of Internal Affairs (DIA), we now have an answer: $11.8 million, or roughly $454,000 for each of the months it was operating.
The breakdown of costs (excluding GST) for the Review were as follows:
Review panel member fees (including expense claims): $1,506,473
Travel (airfares, accommodation, parking, meals, taxis etc): $381,937
Venues and catering: $66,191
Consultants: $1,330,040
Website: $372,545
Publishing costs (report design, writing, printing): $361,415
Department overheads recharge: $1,619,741
Department staff costs: $3,778,062
Contractors: $2,267,064
Other: $132,499
A few things stand out to me here. A quick back of the envelope calculation seems to suggest that the Review panel members collected some decent remuneration for their roles. There were five members, and between fees and expense claims that works out at around $11,588 per panel member each month, or $139,059 a year. Now the exact figure each received will be slightly different due to differing expense claims, and the chair no doubt receiving more than the others, but it was a decent paying gig for just over two years work.
The $372,545 in website costs seems excessive for what was delivered. The website itself is long gone, but you can find it on the Internet Archive and I’m struggling to figure out what cost them so much. There was a submission portal and the “Get Vocal in Your Local” project to engage younger members of the public in the Review, though it does beg the question why pre-existing and proven digital engagement tools weren’t used rather than developing bespoke products at a presumably much higher cost.
The broader website itself is so painfully basic that I could put together something similar in a week at a fraction of the cost. Sure, there are some additional security layers that Government websites get but those alone don’t explain the excessive bill. Someone along the way clearly made some good profit out of producing the website for the Review.
As a point of comparison, the $372,545 shelled out by the Future for Local Government Review for its website makes the $99,000 spent by the Local Government Commission (LGC) for overhauling its website and producing a new logo seem like the LGC got a bargain!
The final bit that strikes me as interesting is the $1,330,040 for consultants and $2,267,064 for contractors which were on top of $3,778,062 for DIA’s staff costs to support the Review. In particular, in their OIA response DIA stated that DIA’s staff time included the secondment of staff and fixed term contracts, meaning that nearly $3.6 million was spent on consultants and contractors over and above the $3.778 million DIA incurred for supplying its own staff to the Review.
I suspect a decent whack of the consultant spend went into the commissioning at least some of the eight additional pieces of bespoke research alongside the broader research and public consultation the Review was undertaking. Possibly some of it was also caught up in the above digital tool development too.
This all begs the question - was this money well spent?
Had something been actually done with the Review’s recommendations, it probably would’ve been money well spent. The Review did produce some genuinely useful ideas, but as I’ve previously critiqued too often their recommendations were for further investigation or additional work, and lacked enough specific details or definitive changes.
As a comparison, the Royal Commission on Auckland Governance produced more in less time, without the widespread availability of digital tools that we have now, and they provided a very specific blueprint for change. Yes, their scope was geographically smaller, but they also didn’t benefit from the 15 years of improvements in digital engagement tools that the Future for Local Government Review did.
As we know, the Review found its work dead on arrival as Labour desperately tried to find a way to get re-elected and decided it wasn’t worth poking the bear of public opinion anymore than they already had done. The Review’s report dying a quiet death just over a year later, as its work was believed to be too ideologically slanted for the oppositely ideologically slanted National-led Coalition, was just the final nail in the coffin.
So ultimately the Future for Local Government Review has ended up essentially being a review to nowhere and it could be argued that it wasn’t money well spent.
I’m not of that view though.
While $11.8 million is a lot of money to the average person and would make a huge difference to a lot of community organisations, it’s barely even an accounting error for the Government.
To put this in context, in Budget 2023 the Government had forecast its total expenses at a whopping $161.9 billion, meaning that if the total cost of the Future for Local Government Review had hypothetically entirely fallen in that fiscal year, it would’ve only represented 0.007 percent of total government spending.
In fact, the Government has spent at least four times as much money in the handful of hours that it’s taken me to research and write this story than was spent on the Review.
Even so, spending public money responsibly is important. Labour initiated the Review in good faith, but their choice of public inquiry vehicle (a ministerial review rather than a Royal Commission) meant that its fate relief too heavily on Labour maintaining its dominating political position in Parliament.
The rest, as they say, is history.
All I can hope is that the next time a Government of either persuasion finds the political courage and leadership to initiate a review of local government with a view to giving the sector the sweeping overhaul it so badly needs, it learns the lessons from the ill-fated Future for Local Government Review process.