Hastings has the wrong council

The Hastings District’s Gross Domestic Product (GDP) is equal to the combined output of Napier, Wairoa and Central Hawke’s Bay. Hastings’ advantages include it’s location in the middle of the highly productive Heretaunga plains, has plenty of room to expand both housing and industry (if permitted by local councils), and  combines with Napier to make up the 5th largest urban area in the country. Anyone driving along the expressway early morning or late afternoon will be left in little doubt that Hastings is where the jobs are, and employment growth is happening. 

Yet Hastings, like Hawke’s Bay generally, has done poorly for years ranking along with Northland and Gisborne at the bottom for economic performance and near top for deprivation. After a 3 decade long economic winter, things are looking much better right now with a 4 star performance in the latest ASB/Main report, but we have seen these glimmers of hope before and they have soon petered out as another recession bites. Remember also we started from a very low base and the fact we have been joined by Northland suggests much of the improvement is because Auckland’s boom has run out of slack capacity and now the benefits are spilling over elsewhere. In population Hawke's Bay is still expanding at near the slowest rate in the country. 

There are many reasons for our anaemic track record including isolation, demographics, ethnicity, low population growth and an excessive reliance on primary industries. 

One possibility that seems never to be considered is that Hastings is disadvantaged by having a council with both rural and urban responsibilities. New Zealand has dozens of rural only district councils and almost all have static economies and shrinking populations. There are a few including Whangarei, Rotorua, Gisborne, Wanganui, Timaru and New Plymouth that like Hastings combine urban and rural areas. Interestingly these also rank near the bottom in economic performance.   

In contrast the fastest growing places including the three main centres plus Hamilton and Tauranga are controlled by city councils and are not burdened with rural responsibilities. There are also some cities that are not doing especially well including Dunedin, Palmerston North, Invercargill, and Nelson. Clearly being a city is not a guarantee of top performance but being a district council seems to align with poor performance. Interestingly both Hamilton and Tauranga have shed their surrounding rural areas into separate slow growing district councils, 8 for Hamilton and 4 for Tauranga.  

Population growth and job creation are essentially a feature of urban areas. Most people live and work in town, most of the rates money is collected and spent in town, and most of the development and all of the challenges are concentrated in urban areas. Urban areas have extraordinarily diverse needs ranging from potable water, sewerage, storm water, libraries, animal control, swimming pools, parks, parking plus housing and industrial development, all requiring specialist expertise. Again in contrast the rural heartland is generally shrinking as evidenced by closing schools and abandoned businesses. Rural areas are mostly concerned with just two issues, roads and bridges.

So whilst combining urban and rural areas into district councils may well have been done to make some councils financially viable, the generally poor performance of our mixed urban/rural councils raises the question of whether this model is sensible. 

In Hastings this composite design has had a second and possibly unforeseen consequence. Effectively it has distorted representation. So instead of city people looking after city issues and rural people looking after roads and bridges, in Hastings rural representatives have ended up with a major say in urban matters. Effectively, a bunch of farmy types pop into town to decide on the rules and finances for urban folk, yet strangely often find reasons why the people they are connected to should be exempt from contributing to the costs. 

  

This is not just a function of having mixed rural and urban responsibilities but is a situation that has been deliberately created by the Mayor. Of the six key chairing positions four are occupied by people associated with the rural area. The Mayor is of course a former farmer (though apparently now living Napier), the Deputy Mayor lives rurally in Central Hawke’s Bay, the  Chair of the Finance committee  represents the rural Mohaka Ward, whilst the Chair of the Hearings committee is a retired Farmer representing the rural Kahuranaki Ward.  I call this group who almost never disagree with the Mayor the tight five because they vote as a block.  One of the two Heretaunga Ward councillors is also a farmer and also almost always votes with the group.   

This imbalance means the wrong council structure and wrong key appointments  are contributing to Hastings poor performance. Had the local Government Commission been less myopic during their evaluation of amalgamation options they might have considered the possibility of combining the Hastings pastoral farming areas with either Wairoa and Central Hawke’s Bay thereby creating local councils with either urban or rural responsibilities rather than a mixture of both.