Response to Taxpayers’ Union Press Release

Press Release – The Remuneration Authority

The New Zealand Taxpayers’ Union got it wrong in saying that West Coast Regional Councillors had been given a 41% pay increase by the Remuneration Authority.

The actual increase in the amount of money available to pay West Coast regional councillors last year was 11%, which completed the adjustments in pay that we have been doing following a review in 2018.

Rather than publicly whinging about something that was not correct, the Taxpayers’ Union should have had a look at the facts. Had they done so they would have discovered that the system for paying all councillors round the country was changed in 2019 and that councils are now given a governance remuneration pool which reflects the assessed “size” of their governance role, and which must be allocated by the council itself amongst its elected members. Previously the Remuneration Authority decided the pay for each elected member and councils had a smaller pool to allocate for positions of responsibility such as committee chairs. The pool has no relationship to the number of elected people on any council, so the higher the number of representatives, the less pay they each receive. In the case of the West Coast, there are only six regional councillors amongst whom the remuneration pool is shared.

Under the new rule the whole pool must be fully utilised. This is to stop councils bring pressured by ratepayers to pay themselves less and less – a syndrome which is not unusual in local government politics. In fact the West Coast Regional Council is a case in point – it did not fully allocate its pool prior to the 2019 changes and the increase seemed steeper than it was.

For the record, the West Coast Regional Council has the smallest remuneration pool of any regional council in New Zealand.

The reason why the Remuneration Authority reviewed local government pay was that in many instances elected members were paid well below the minimum wage on an hourly basis. Even with the changes, many are still working for very low hourly rates. The benchmarking with MPs salaries which the Taxpayers’ Union also grizzled about is simply benchmarking and does not mean that every local government person will be paid an MP’s salary. In fact we have pegged the remuneration of the largest local government role – Mayor of Auckland – to that of a Cabinet Minister and everyone else is well below that.

The Remuneration Authority is happy to brief the Taxpayers’ Union on any of these issues if they are interested prior to bursting into print.

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