Local Government Magazine

Wellbeing – Will it be the great disruptor?

Deep change is coming to the local government sector, says public policy consultant, Peter McKinlay. The reintroduction of the four wellbeings presents an opportunity for local government to become the natural partner of central government in working with communities. Peter outlined his thoughts to a capacity crowd at the recent SOLGM Summit.

Councils have welcomed the government’s action to make promoting community wellbeing the second purpose of local government. Councils wanted this back in the Local Government Act to remove any doubt about the power to do things which might not strictly be least-cost to households and businesses, but which councils thought would be for the good of the community. There’s a nice feelgood sense about the additional scope it will give councils.

But the world has changed since that purpose was last in the act. Bringing back the promotion of community wellbeing could trigger the biggest change in how communities are governed we have seen in the life of local government.

It’s a big claim but let’s look at the context. New Zealand has a government committed to making wellbeing the principal focus of public policy. Wellbeing is ultimately about the lived experience of individuals, families and whanau and the communities in which they live.

Historically, New Zealand’s councils haven’t had much to do with most of the things which influence wellbeing. Unusually for developed countries, all of our major social services have been the responsibility of central government either directly through ministries and departments or at more arm’s length through government-controlled entities, such as district health boards.

Implicit in this arrangement is the assumption that centrally-determined policies directed from the centre are the best approach to improving outcomes.

It’s meant there’s been less focus in New Zealand local government on how to work with, and understand, the priorities of their communities than is common in other jurisdictions.

It has also meant that initiatives to improve the connection between councils and communities have usually focused on new and improved ways of putting council information out and inviting individuals to respond.

A lot of this can look quite innovative, but it coexists with the situation in which one of New Zealand’s most respected local government chief executives could say the following. “We talk a lot about building high-trust environments in local government, but we carry on building hierarchical structures that challenge the concept of trust… There is a huge risk that we will become irrelevant to our communities as they evolve and set their expectations to accommodate changing trends.”

This reflects the reality that New Zealand councils have been slow in learning how to apply a community governance approach. That is understood to be a collaborative approach to determining a community’s preferred futures and developing the means of realising them.

Practices, such as co-governance, co-production and partnership working, are seldom found. This is despite the potential benefits which include rebuilding trust in the political process, enhancing a council’s ‘licence to operate’, tapping new sources of funding and, above all, gaining the benefit of people’s knowledge about their own communities – reflecting the now-common understanding in place-shaping that the experts about a place are the people of the place.


So, given our history, why claim that reintroducing the purpose of promoting community wellbeing could trigger the biggest change we have seen in the way communities are governed?

Start with the difference between 2002 when the purpose was first introduced (to be withdrawn in 2012) and 2018. In 2002, there was no connection with central government’s own policy priorities. If anything, the provision simply echoed legislation which had recently given councils in England and Wales the power to undertake any activity which they believed might promote community wellbeing.

In 2002, there was little in the way of established practice or understanding of how to define and measure community wellbeing either at the macro level of the four wellbeings or at a more micro level of selected aspects of wellbeing.

Instead, councils were required to lead a process with their communities identifying their preferred community outcomes. Experience shows that, almost regardless of whether the council was large or small, urban or rural, preferred community outcomes were much the same.

In practice, the process and the purpose of promoting community wellbeing, became something of a comfort blanket enabling councils to do ‘nice things’ which they thought would be good for their communities. (Such an understanding became the basis of subsequent criticism and then removal of the purpose.)

The change in the policy setting between the original 2002 purpose and what is now coming in could hardly be more dramatic. First, wellbeing is now the principal focus of government policy. By itself, this changes the context for local government.

For someone unfamiliar with the way in which New Zealand’s central governments have traditionally treated local government, it looks as though government is setting up a partnership relationship based on subsidiarity.

Government will take the overall role of defining wellbeing and determining appropriate indicators, and local government will focus on the actual promotion of community wellbeing.

If that were to happen, it would be a major change in the role of local government. It would effectively put councils at the centre of working with communities, helping them assess their wellbeing against government-developed indicators.

It would also suggest a central role for councils in their developing strategies designed to improve outcomes if assessment suggested this was desirable.

Inevitably, this would mean a partnership relationship with government agencies and others, and almost certainly a coordinating role for councils.

It’s a change which would also be consistent with practice elsewhere. In broad terms, this is already what happens in Wales which is becoming something of an exemplar internationally. Three years ago, the Welsh Assembly enacted the Well-being of Future Generations (Wales) Act.] It set out four principal wellbeings. Exactly as with New Zealand local government, these were economic, cultural, social and environmental. Under the act, it is the Welsh government’s responsibility to determine objectives and indicators (46 have been developed).

It’s then over to localities to assess the wellbeing of the communities against the government’s indicators and develop wellbeing plans designed to improve outcomes.

In brief, the act provides that each of the 22 local authorities in Wales will establish what are called public services boards, bringing together other significant entities serving the local authority area to undertake the assessment, planning and implementation.


The operation of the act is overseen by a statutory officer, the Future Generations Commissioner of Wales, Sophie Howe. She is very clear that her role is to ensure local authorities and others working within their districts undertake their responsibilities but it is not for her to tell them how to do so as opposed to holding them to account for doing so.

Instead, there is a very strong emphasis that public services boards need to work closely with their communities. This is not just at the level of the local authority but at the level of discrete communities.

This reflects a view that wellbeing is very much about the lived experience of individuals, families and communities, and not some kind of standard assessment that can be rolled out from the centre.

It also reflects the perception that developing ways of improving wellbeing depends crucially on working closely with communities (and the emerging experience in Wales supports the wisdom of this judgement).

So, is New Zealand going to follow the Welsh example and recognise the pivotal role of communities not just as recipients of intervention but as co-designers and coproducers?

The jury is very much out. First, as yet it is very hard to find any sign that central government and its agencies have thought through the implications for government’s wellbeing policy of the local government purpose of promoting community wellbeing. At best, it seems for the moment, councils are seen as just another group of stakeholders.

Second, it seems most councils themselves still regard the change to legislation as more in the nature of a reversion to 2002 than a fundamental shift.

This is to ignore both what the act will actually say, and the major changes in practice since the purpose was last in place. As well as the new purpose, the draft legislation proposes that councils, when taking a decision, must consider the impact on each of the four wellbeings.

English experience suggests this will require councils to demonstrate a clear track record of how that impact has been considered in the lead up to a decision if the risk of judicial review is to be avoided. A number of wellbeing-related decisions by English councils have been overturned because of the failure to demonstrate a clear decision trail.

Next, and at least as important, the past 10 or so years have seen a dramatic change in the practice of understanding and measuring wellbeing. This is not just in the broad categories of the four wellbeings, but at a relative microlevel both in terms of geographic scale and in terms of the specific wellbeings themselves.

NGOs such as Bristol-based Happy City (which has developed the thriving places index widely used in Wales and elsewhere), the New Economics Foundation and the Young Foundation have raised understanding of the practice of measuring wellbeing at a community level to a point where it is becoming routine good practice.

This strongly suggests that councils will need to adopt a broadly equivalent practice if they are to comply with the new decision-making rule.


One possibility is that the requirement on councils to understand the impact of their decisions on each of the four wellbeings becomes an onerous compliance obligation adding little to genuine understanding of, or partnership with, communities but adding a lot to ongoing costs.

Another possibility is that local government recognises the enormous opportunity that the wellbeing purpose presents. This means picking up on overseas understanding of the importance of actively involving communities and assessing wellbeing and co-designing solutions to improving outcomes.

This is an approach which should be extremely timely. Most councils know that within their districts are communities which are seriously disengaged and that finding ways of rebuilding inclusive communities is critically important. Most also have an instinctual understanding that this is something best led by the council.

Despite New Zealand’s ongoing obsessional centralisation, growing experience suggests that central government should be a strong ally. Achieving its underlying wellbeing objective will require strong partnerships at a community level.

The question is how to do this, and how to engage communities – most of whom are relatively disengaged from council process and not at home with standard bureaucratic practice and language.

The good news is there are plenty of excellent examples of what works. These cover not just better outcomes for engagement of social conclusion but often also better outcomes in terms of costs to councils and ratepayers, and effectiveness in service delivery.

Amongst possible options are:

• Actively encouraging co-decision-making. In the UK, Wiltshire Council works with area boards to co-design local solutions and trigger coproduction to deliver them.

• Social procurement. The idea of buy local is already common. Social procurement goes much further, looking at how to ensure that each dollar spent by a council not only buys the goods or service required but also has positive spin-offs for its local communities especially those which are least well off. (Among other things, it’s a great way to support social enterprise.)

• Participatory budgeting. This is gaining in popularity as a way of genuinely involving communities in shaping their own local places as they work through how best to allocate funding to be spent within their area.

Local government has in front of it an opportunity to place itself at the centre of effective governance of its communities. It can use both the new legislation and changing international practice to make the case that it is an essential partner with central government in acting as the advocate for representation of its communities. 

• Peter McKinlay is executive director of public policy consultancy McKinlay Douglas. peter@mdl.co.nz

This article was first published in the November 2018 issue of NZ Local Government Magazine.

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