Bigger is not better or more efficient when it comes to local councils

The Taxpayers’ Union is cautioning against Wellington rushing into its own version of a ‘Super City’, pointing to the lack of evidence that bigger councils reduce cost.

Taxpayers’ Union Policy and Public Affairs Manager, James Ross said:

“The annual Ratepayers’ Report - an annual league table of local government performance - shows that bigger doesn’t mean better when it comes to local councils. Whilst councils should work together on sharing services and infrastructure where this leads to cost savings, Auckland’s Super City goes to show that supposed leaning down of the back-office bureaucracy certainly isn’t guaranteed.

“Wellington last had this debate just over a decade ago. Back then, Hutt City Council commissioned TDB Economics to look at the evidence on the ideal local council size in terms of the average cost. Its conclusions broadly matched the Ratepayers’ Report, showing that economies of scale turn into diseconomies of scale once a council hits about 200,000 in population.

“Questions also need to be asked about giving Wellington City Council an easy off-ramp, by forcing the debt caused by their mismanagement of the city on to ratepayers across the wider region.”