Remuneration Authority legal framework

The main acts relating to remuneration for elected local authority members are:

  • The Local Government Act 2002, clause 6 of Schedule 7 which provides for:
    • the Remuneration Authority to set the remuneration, allowances and expenses of mayors, and other elected members on local authorities, community boards and Auckland Council local boards
    • to set scales of salaries, allowances, ranges of remuneration, different forms of remuneration; prescribe rules for the application of those scales, ranges or different forms of remuneration; differentiate between individuals occupying equivalent positions in different, or in the same, local authorities or community boards; set pay arrangements that apply to individuals or groups occupying equivalent positions
    • place a levy on local authorities, to be set by the Minister responsible for the Remuneration Authority, to cover the costs of the Remuneration Authority in setting the remuneration of local authority members.  This levy is administered by the Ministry of Business, Innovation and Employment.
  • Clause 6 of Schedule 7 of the Local Government Act 2002 states that the Authority must give regard to the need to:
    • minimise the potential for certain types of remuneration to distort the behaviour of elected members
    • achieve and maintain fair relativity with the levels of remuneration received elsewhere
    • be fair both to the persons whose remuneration is being determined and to ratepayers
    • attract and retain competent persons.
  • The Remuneration Authority Act 1977 (sections 18 & 18A) sets out additional criteria to which the Authority must have regard in determining the pay for local authority elected members and the other groups and individuals for which it sets pay. These are:
    • the requirements of the job
    • the conditions of service enjoyed by the persons whose remuneration is being determined and those enjoyed by the persons or members of the group of persons whose remuneration and conditions of employment are, in the opinion of the Authority, comparable with those of the persons or members of the group of persons whose remuneration is being determined.
    • any prevailing adverse economic conditions (which may lead the Authority to set remuneration at a rate lower than might otherwise have been the case).