If Kaipara ratepayers are worried about their own white elephant or lemon, the EcoCare scheme, they should see the problems that Dunedin ratepayers are facing.  Down south they have a supersized white elephant in the shape of the Dunedin Stadium that was rushed through at massive cost, and against the wishes of many locals, in time for the last Rugby World Cup.  Read about the local ratepayers' woes here.

Also have a look at What if, Dunedin which highlights the concerns of locals.  Note Elizabeth's comment about what locals call the Glasshouse:

The glasshouse-fubar though, has bred of itself a bloated money-sucking monster for DCC, ratepayers, and residents. For accountability and transparency, need we ask if fumigation and sterilisation are enough to eradicate white collar aphids and fungal rorting?

The Council has even considered moth-balling or pulling down the stadium.  The same decision will soon face the KDC and ratepayers in respect of the EcoCare scheme.  The current debt is well over $60 million (if you include the monies filched from the Mangawhai Endowment Fund and other funds) and is simply too large for Mangawhai and Kaipara ratepayers to pay.  But like the Dunedin Stadium, the scheme needs further massive sums spent on it in the future if it is to continue functioning. That means even more debt and higher rates.

All will be revealed in the new LTP due out probably in the New Year.

LGFA  21.11.14
The Local Government Funding Agency will become well known to New Zealanders in the next few years.  It is a scheme proposed by local government and central government to rort the people of this country.  The idea is that all local authorities in the country join the scheme and they all cross-guarantee the debts of the others.  The benefit of this, which is the only thing that you will hear about it, is that local authorities have access to slightly cheaper loans, because the money is effectively guaranteed.

The debts are guaranteed by the councils, but what they do not explain is that every Council debt across the country is effectively guaranteed by all the ratepayers in New Zealand under the protected transaction provisions of the LGA.

That means that all ratepayers in New Zealand will be responsible for the EcoCare debts when Kaipara eventually folds. That is if they cannort extort the monies out of the Kaipara ratepayers.

Likewise every ratepayer in New Zealand will be responsible for the Dunedin white elephant, the Auckland City blow-outs, and every other local government rort that has become endemic in New Zealand.

Kaipara does not meet the requirements of the LGA at the moment and cannot join.  It is in breach of its banking covenants and could face serious financial problems if the Court of Appeal endorses the arguments of the MRRA. 

The Council is being pressured by the banks and the Department of Internal Affairs to mop up the rates revolt and that is why it has now resorted to terror tactics to extort the last drop of penalties from ratepayers.

A decision in the Court of Appeal that ratepayers are not responsible for debts entered into for an illegal purpose (which the High Court ruled that EcoCare was) would completely undermine the guarantees that are fundamental to the NZFA concept.  And that is why the the government, the banks and local government are fighting the MRRA proceedings.

Local authorities are not subject to the law. Sure there are very strict requirements set out in the Local Government Act and the Local Government (Rating) Act but neither the Ombudsman or the OAG will have anything to do with their enforcement.

But what of the courts? What of the rule of law?

As a general principle of law illegal acts of a local authority are voidable which means that a court has the power to declare them to be illegal and of no effect. But effectively that means that a local authority can do anything that it likes, legal or not, and its actions are not deemed to be illegal until a court makes that ruling.

The catch is that it is incredibly expensive to go to court - the MRRA has stumped up $200,000 so far - and, if anyone has deep enough pockets and the intestinal fortitude to opt for the legal lottery, the local authority will use every trick in the book to block your access to justice, using ratepayers' money, of course.

And, if all else fails, they will get the government to legalise their malfeasance and gazump the legal system, using ratepayers' monies, naturally.

So, in this so-called democracy local authorities have unlimited power with the auditor and OAG looking in the other direction and the court system rendered nugatory because of its cost, its delay, and its manipulation by local authorities.

That is why councils can flout the law so arrogantly and openly. And that is why they are pursing the whistle-blowing rate strikers through the court, at huge expense to ratepayers again. They and central government (through the DIA) want to send a message to all ratepayers in New Zealand they that they must be obedient serfs who must pay for the excesses and illegalities of local authorities without objection and protestation.

It is not just compliance with the law that is now extinct in local government. All the fine principles of civilised behaviour that we like to think reflect our society are also at risk. No one could imagine more acute malfeasance and dishonesty then the activities of the KDC over the last few years, and yet every one involved has, so far, got off scot-free and Parliament has seen to fit to sanitise all the legal transgressions.

The true extent of the KDC's rorts have not been revealed because those in local government do not want to destroy the image of local government that they wish to present to the world. So we get white-wash and smoke and mirrors.

Dishonesty in the present to cover up the dishonesty in the past.

Hence the current regime in power at the KDC will not allow independent experts in to look at the true state of the finances. That is why they gloss over the defects of the EcoCare scheme. And that is why they will never allow a democratically elected council back into Kaipara. Too many skeletons in the cupboard (and no money to boot) which a new crop of councillors might expose to the world.

The lid on Pandora's Box must remain nailed down and padlocked.

Since the Commissioners have been in power they have spent a vast fortune on legal advice. Virtually every decision that they have made has been preceded by an expensive legal opinion. It has been suggested that John Robertson even consults David Goddard QC on his choice of breakfast cereal each day, but that is probably an urban myth.

Spending money on lawyers is irrelevant to the Commissioners, as it is not their money. They criticise the MRRA for appealing the Heath J decision and wasting Council money that could have been spent on roads, but they selectively choose to ignore the vast sums that they have poured down the gullets of lawyers to achieve the ends of the banks and the DIA and to deny the ratepayers of the district their legal rights.

They gloss over the fact that Heath J awarded the MRRA indemnity costs in their High Court action, which is as rare as integrity and transparency in local government.

That award of about $150,000 was a clear message from the Judge to the Commissioners that they had denied ratepayers their legal rights by introducing the Validation Bill to gazump the MRRA legal case.

But John Robertson and his men just laugh it off. After all it is not their money.

The NZ Herald (here) reports on the public perception of the SFO:

Far fewer victims of financial crime are satisfied with the sentences handed to white collar criminals than two years ago, according to a Serious Fraud Office survey.

One of the SFO's aims is to increase public confidence that the perpetrators of financial crime are held to account.

One of the biggest problems is that the SFO has effectively been excluded from an area where financial "crimes" are rampant, and that is in the local government arena.

For some reason that is incomprehensible to ratepayers, local government rorts and fraud are outside the bailiwick of the SFO. Councils are free to rip off their ratepayers with impunity and the SFO will sit on the sidelines and do nothing.

It is not just the SFO that becomes impotent at the mention of local government. The Ombudsman runs for cover and defers to the OAG, and the OAG, the watchdog and the auditor for all local authorities, not only ignores the blatant breaches of the law and the impoverishment of local communities at the hands of rogue councils, but implicitly encourages the plundering and pillaging of ratepayers.

In the Kaipara debacle Auditor-General Lyn Provost sat on her hands for years while the bandits destroyed Kaipara with their recklessness and blatant illegalities, and, when the SFO showed an interest, she ushered it away in a different direction. Local government and Kaipara were her baby and she would call upon the SFO only if fraud was revealed.

The official OAG report - a travesty of an independent inquiry reeking with the stench of conflict of interest - made the finding that there was no fraud perpetrated in the Kaipara debacle. Perhaps that was a bridge too far for the OAG to admit. It had ignored incompetence, financial ineptitude, legal transgressions but to admit to fraud being perpetrated on its watch was probably too much. That would have opened the proverbial can of worms that would have been too difficult to bury.

There was, of course, fraud in Kaipara. EcoCare was a fraud on a massive scale. All of the major parties involved were aware of the illegalities that were perpetrated but were only concerned with their own enrichment at the expense of ratepayers.

Ratepayers were completely duped and ended up with a scheme that does not achieve its purpose, was massively expensive and does not work. The ratepayers of Kaipara have been ripped off to the tune of over $60 million for EcoCare alone. And if you add in all the other rorts and excesses, and the theft of reserve funds and endowment funds, the loss is much greater.

The failure of Adam Feeley, then head of the SFO, to override the OAG injunction not to interfere in Kaipara left the impression that the SFO's targets are selected on a political basis. His surprise departure soon after, and his appointment as chief executive of a local authority, suggested to many that he had been reluctant to muddy the local government waters and smear the reputation of a fellow local government chief executive.

I wonder what Aldous Huxley would have thought of it all?

Aldous Huxley, British writer and philosopher, writing in the 1930s and 1940s, was concerned about the future of democracy. He had this to say:

Under the relentless thrust of accelerating over-population and over-organization, and by means of ever more effective methods of mind-manipulation, the democracies will change their nature; the quaint old forms--elections, parliaments, Supreme Courts and all the rest--will remain. The underlying substance will be a new kind of non-violent totalitarianism. All the traditional names, all the hallowed slogans will remain exactly what they were in the good old days. Democracy and freedom will be the theme of every broadcast and editorial--but democracy and freedom in a strictly Pickwickian sense. Meanwhile the ruling oligarchy and its highly trained elite of soldiers, policemen, thought-manufacturers and mind-manipulators will quietly run the show as they see fit.

Home archives can be viewed here