Prime Minister Christopher Luxon addressed attendees at the Local Government New Zealand conference in Wellington today, urging local councils to “rein in the fantasies” about spending. He emphasized that ratepayers expect local government to “do the basics and to do the basics brilliantly.”

“Pick up the rubbish. Fix the pipes. Fill in potholes. And more generally, maintain local assets quickly, carefully, and cost-effectively,” Luxon said.

Luxon pointed to the Tākina convention centre, the very venue of the conference, as a case in point. Concerns have been raised about the costs of the recently completed building. “The building we’re in today is a classic example,” Luxon remarked, eliciting some audible grumbling from the audience.

Amid ongoing water issues in Wellington, including today’s flooding, Luxon criticized the Wellington City Council’s decision to spend $180 million on the convention center, which, according to public reports, is now losing money. “It looks very nice, and it’s very nice that politicians like us have another expensive room to deliver speeches in, but can anyone seriously say it was the right financial decision or the highest priority for Wellington given all of its challenges?”

He continued, “Ratepayers are sick of the white elephants and non-delivery. So, my challenge to all of you is to rein in the fantasies and to get back to delivering the basics brilliantly.”

Luxon acknowledged that local government officials often claim they need more funding. “I have to be honest with you—the previous government might have taken that approach, but the party is over. There is no magic money tree in Wellington, thanks to the previous government’s economic mismanagement and vandalism.”

While expressing a desire to work closely with councils and provide new revenue tools, Luxon declared, “The days of handouts are over.”

He announced that Cabinet has agreed to streamline the Local Government Act and abolish the four wellbeing provisions in the legislation. They will also investigate performance benchmarks for local councils. “Sunlight is the best disinfectant—and ratepayers deserve to know exactly what they’re getting for their rates,” Luxon said.

The government will also explore ways to limit council spending on what Luxon termed ‘nice-to-haves.’ “Yes, councils need adequate revenue to fund core responsibilities like roads, rubbish, and water, but the value-for-money proposition is more questionable in a range of other areas.”

Cabinet will review the transparency and accountability rules that apply to councils. “We want a productive and constructive relationship with local government—one that enables your growth and development and gives you the tools you need to pay for it,” Luxon stated. “But we expect you to spend ratepayers’ money responsibly.”

Earlier this year, Local Government New Zealand commissioned a report from Infometrics that found homeowners faced average rates increases of 15 percent. After the speech, Luxon told media, “Many councils are actually doing a very good job balancing their balance sheets.”