New auckland
Auckland demands more money from rest of NZ

Regardless of who wins the battle for the Auckland mayoralty, the Government will be facing a ramping up of demands for radical change to the city's growth funding needs, Tim Murphy reports.

Auckland will demand more money from the rest of New Zealand whoever wins the battle for the city's mayoralty - with both leading candidates agreeing central government is short-changing one-third of the country's population.

Mayoral challenger and former Labour cabinet minister John Tamihere depicts Auckland as being in a "headlock" from Wellington which must end and incumbent mayor Phil Goff says Parliament created a Super City but is still funding it like it is 29 small boroughs.

The men each told the latest campaign debate before 80 Auckland Property Council members that only they could force a change from central government which would provide money for the city's growth.

Goff said Auckland had undergone more growth in population than the rest of the country put together and with 40,000 new residents a year could not be expected to go "cap in hand" to Wellington for more money for every project necessary to cope with that growth. (The Auckland population is actually expected to grow by 30,000 this year and next, according to council officials, after peaking at Goff's figures up to 2017).

The mayor supported a Productivity Commission proposal that the Government provide cities with capital grants depending on their level of growth, noting Auckland would automatically be a major beneficiary if such a scheme could be introduced.

The city had benefited from a one-off Special Purpose Vehicle or SPV funding arrangement in which the Government agreed for ACC funds to be used to pay for roads, drains and other infrastructure in the residential development at Milldale, near Silverdale. The mayor said a new law making that kind of solution possible more widely was now on the Government's agenda.

Goff repeated his call for the Government to return to Auckland the $200 million-plus a year in GST that Aucklanders pay on their rates - a form of double taxation which he said was a ready-made solution to some of Auckland's growth funding needs.

And he raised the prospect of  "the Government paying rates on its own property in Auckland, or it might be some other form of devolution. Auckland deserves that to be given genuine consideration".

"I have said to both governments [National and Labour-led] that we have got to think more fundamentally about how we fund growth cities."

But new forms of funding such as the regional fuel tax, accommodation levy and special rates for water quality and the environment had been found. He told the property industry attendees development contributions that they paid could not be cut - "that's not going to happen" - but promised further consultation about how those monies were used.

Tough talk of mana and purges

Tamihere's demands on the Government were even stronger.

When Goff told him he could not go to Wellington demanding money for projects with no business case, like the mooted double-tier replacement Auckland Harbour Bridge, Tamihere said that showed "capitulation and surrender".

"Auckland has the mana to make or break governments..... central government has Auckland in a head-lock and the only way to change that is to put some lines in the sand," he said.

"We need to strike a new relationship with Wellington. We paid for the rebuild of Christchurch, the repairs in Kaikoura and the repairs in Wellington. The Provincial Growth Fund - Aucklanders are not allowed to put their hand out for that. We have to ensure that central government coffers cough up."

He wants taxes, not rates, to pay for better Auckland services for health, welfare and homelessness and renewed funding from the national transport agency for projects like his big harbour bridge.

As well as targeting more money into Auckland from Wellington, Tamihere broadened his assault on what he calls a "gouging out" of Aucklanders by contractors engaged by council controlled organisations. "We have to take control of the city," he said.

He extended his list of organisations and people to be purged should he win the mayoralty. Not only the board of Auckland Transport but that of the development agency Panuku and "four executives... I won't name them but they will be going as well".

Later Tamihere said a change of mayor would mean a change of chief executive and incumbent Stephen Town would be "going back to Tauranga." Goff jumped in to point out Town's contract extension has him in the role only until the end of 2020 before he retires.

And when discussing a controversial deal for Panuku to sell the former council administration building to a developer, Tamihere told Goff: "Someone's going to jail when I get there".