The $9 million already spent on council amalgamation proposals is just the start.

If there’s one message our government has hammered more than the importance of local control, it’s that councils suck shit. Politicians from the prime minister on down have repeatedly taken aim at local authorities. They’ve criticised them for following the government’s instructions on parking. They’ve condemned them for having the temerity to build things other than roads. Most of all, they’ve taken aim at them for wasting your hard-earned money. Christopher Luxon in particular has long been haunted by an expensive twinkly toilet in Wellington and a cycleway on Molesworth Street that left him permanently marooned roughly 20 metres away from parliament.

You can debate the value of those projects, though it’s worth noting the toilets in particular have been a game-changer for Wellington’s disabled community. What’s not in question is that the bill for them is infinitesimally small compared to the gargantuan amount of cash the government has forced councils to flush down their rotten pipes and into the sea off Moa Point. 

The sums put $2.3 million twinkly toilets to shame. Start with the recent botched attempt at council amalgamation. In May, local government minister Simon Watts and RMA reform minister Chris Bishop told our local authorities they had three months to come up with plans for their own executions. If they didn’t do it themselves, they threatened, the government would do it for them. 

Psych. Many councils dutifully spent three months working overtime to develop merger proposals, only for Watts to tell them last week that nothing is going ahead until after the election at the earliest, though some suspect the amalgamations may never happen at all. Documents obtained by 1News show the estimated cost of the work so far is roughly $9 million.

When mayors complained about having to throw $9m into the bin, Watts told them to stop playing politics. Even that’s chump change compared to the costs the government has imposed on Auckland Council with its series of flip-flops, backtracks and U-turns on housing.

So far this term, it’s lowered the mandatory minimum housing capacity the council has to implement from two million, to 1.6 million, to 1.4 million. Each time, the council has scrapped much of its old work and spent time developing a new plan. The vacillating was estimated to have cost about $15m in July, though according to council sources that figure has grown.

Painful, but still not as ruinous as the potential bill Auckland Council will have to shoulder thanks to the government’s fast-track legislation. It’s currently estimating that the “unanticipated developments” that are either planned or already approved under that system will incur roughly $5 billion in ongoing infrastructure costs, including $2bn it won’t be able to charge back to developers at all.

This month, the government responded to council lobbying by changing legislation to allow them to pass on the full cost of greenfields development. But it won’t help Auckland when it comes to the 3,400-house Sunfield development near Papakura or the 1,200-house Delmore development near Orewa. Both already have consent under the fast-track scheme. Thanks to the vagaries of the planning system, the council doesn’t believe it will be able to make developers pay in full for the roads, pipes, powerlines and other amenities those precincts will need, let alone the strain the new residents will place on our transport network. Its development committee chair Richard Hills says ratepayers will likely be on the hook for around $500m in infrastructure and maintenance.

That’s to say nothing of the $7m five councils spent increasing speed limits around schools thanks to an edict from former transport minister Simeon Brown, or the estimated “tens of millions” they had to pay to hold government-mandated referendums on Māori wards that were already in place. All up, the bills foisted on councils by the government could buy them at least 200 light-up toilets with money left over. If they were the government, they could just chuck those extra costs on the credit card. Unfortunately for them, they’re held to higher standards of fiscal rectitude, with the Local Government Act 2002 requiring them to run balanced budgets. 

Back in 2024, Luxon issued a speech scolding local authorities for what he saw as their profligacy. He urged them to start setting “clear delivery targets and expectations” and “prioritising what to do and what not to do”. “My challenge to all of you is to rein in the fantasies and to get back to delivering the basics brilliantly,” he said. That message remains pertinent. Luxon was right to warn about the huge and growing costs that come with unclear planning and poorly thought out priorities. Only it turns out the target was slightly askew. If Luxon wants to find the real culprit when it comes to council waste, he should just look at his own cabinet table.