ACT Local Government spokesman Cameron Luxton is urging councils across New Zealand to prioritise value-for-money in procurement, challenging what he calls “politically correct” policies.
Luxton claims that a focus on “progressive,” “diverse,” or “sustainable” outcomes undermines efficient service delivery and drives up costs for ratepayers.
“Council procurement should have one purpose: deliver quality services at the best possible value for ratepayers,” he said in a statement.
He pointed to the Government’s recent decision to scrap Labour’s quota requiring 8% of government contracts be awarded to Māori businesses, suggesting councils should follow suit.
Luxton claimed he had identified several major councils with policies that stray from a cost-focused approach including Wellington City Council, Palmerston North City Council and Christchurch City Council.
“Bureaucratic, politically correct procurement rules mean reliable contractors are ruled ineligible, or are simply put off by the paperwork,” he said. According to Luxton, such practices create an “exclusive club” of preferred contractors, reducing competition and increasing costs.
As an example, he cited Auckland Mayor Wayne Brown’s review of the city’s procurement rules after a long-standing contractor was excluded for not meeting “social enterprise skills” criteria.
“Councils should be interested in whether a contractor can get the job done at a fair price,” he argued, calling it “absurd” that contractors are sometimes required to demonstrate ties to Māori organisations or qualify as Māori businesses.