In 2018 the Authority completed a comprehensive review of its approach to determining the remuneration and allowances for local government members.
As a result of that review, remuneration for elected councillors, mayors, and regional council chairs is now determined within a local government pay scale which takes into account three factors:
Remuneration for Community Board members and members of Auckland Local Boards is not determined according to the local government pay scale because of the distinctive structure and responsibilities of these boards.
There is also provision for local government members to be paid for their involvement in hearings and related meetings for resource consents and district/regional plans under the Resource Management Act.
Local government members are also entitled to a range of allowances that reimburse them for expenditure required in undertaking their duties. All allowances are paid at the discretion of the council.
Download the 2018 review:
For the Remuneration Authority, the term “size index” means the assessed size of the total governance accountabilities of any council. It has no relationship to the number of councillors on that council.
Because the different types of council in Aotearoa/New Zealand have diverse responsibilities, the Authority has created three size indices – one each for territorial authorities, regional authorities and unitary authorities.
The size index for territorial authorities is based on:
The size index for regional authorities is based on:
The size index for unitary authorities is based on:
All factors used are retrospective but measured at “a point in time” as near as possible to the time of our decision. No data sets should be more than three years old, except for the socioeconomic deprivation index which is updated following every census.
The only councils not included in a size index are the Auckland Council and the Chatham Islands Council, both of which are considered outliers because of their respective sizes.
These size indices were developed specifically for use by the Authority in assessing local government members’ remuneration and are not intended to meet the needs of any other users.
Find out the current rankings of councils based on their size index:
Work load – time required for local government members to undertake the role
As part of the Authority’s research into the roles of local government members, it became evident that in the large “metro” councils (Christchurch, Wellington, Hamilton, Tauranga and Dunedin) a councillor was likely to work up to full time – i.e. one full time equivalent (FTE).
There is a second group of councils where councillor workloads sit between full time and half time, with the workload of members of the remainder of councils generally varying around or below 50% of an FTE. The data collected showed that both between and within councils the average work time differs, even allowing for different roles such as deputy mayor or committee chair. However, the overall pattern was sufficient for the Authority to use it as a basis for decisions.
In constructing a local government pay scale, the Authority was required to have regard in particular to the need to achieve and maintain fair relativity with remuneration received elsewhere.
After exploring various occupational groups that might have some relativity with local government members, the conclusion was that the only similar occupation was that of a Member of Parliament. Thus the parliamentary salary scale is now used as a comparator, but based on the position of each council on the size index and the pro rata time required for an average local government member to undertake the role on a council of any particular size.
No local government member, regardless of the size of their role, is able to be paid more than a Cabinet Minister.
Local government members’ remuneration reflects this pay scale, which is based on the elements described above. As a consequence of this approach, pay relativities between councils have changed over the last few years, with differential increases in remuneration beginning in the 2018/19 determination.
The remuneration of local government members on Christchurch City Council (the largest council excluding Auckland) is used to anchor the top of the pay scale. The bottom of the councillor pay scale is anchored by a proportion of the annual average wage. However, we have concluded that there is a “basic job” for any councillor, no matter how small the council size.
Except for the Chatham Islands, the lowest councillor remuneration is currently now pegged to a half time equivalent of about two thirds of the average wage. In the case of the smallest councils this breaches our governance remuneration pool approach and means that the resultant governance pool needs to be increased to reflect the current number of councillors, rather than the ranking of the council on the size index.
Of the 13 councils that are currently impacted, one has 14 councillors, but the average number of members of the remaining 12 councils is between eight and nine.
Because of their respective sizes, neither Auckland Council nor the Chatham Islands Council fit within our size indices, so each year the Authority makes an informed judgement on the size of the pools for these two councils.
In undertaking its 2018 review, the Authority looked at the issue of the different numbers of local government members on different councils. This led to the introduction of a governance remuneration pool, which provides the total amount that must be paid in remuneration to councillors in each individual council.