The Department of Internal Affairs

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Local Government in New Zealand - Local Councils


How a council can structure itself

Each council makes its own decisions about how it will structure or organise itself to work for and on behalf of its community.

What does the council itself have to decide?

Activities that can only be decided by the full council, include–

Councils can make other decisions either as a full council, or by delegating some matters to a committee of the council, a community board, or a council organisation.

The Local Government Act 2002 sets out how a council can delegate decision-making, but specifies the council is always responsible for the delegated decision. Councils can also set up council organisations to do things on its behalf.


Councils can set up committees (usually a standing committee appointed for the term of the council), sub-committees and other decision-making bodies that it considers appropriate. They can also set up joint committees with other councils or public boards (such as district health boards).

A committee must have at least three members, and a sub-committee must have at least two members. Committees and sub-committees must have at least one member who is a councillor. People who are not members of the council may be appointed to a committee or sub-committee if they have a special skill or knowledge that will assist its work.

Community Boards

Many territorial authorities have community boards to help represent and advise councils on community views. They sometimes carry out delegated council service delivery or regulatory responsibilities. (Regional councils do not have community boards.)

Delegated responsibilities may include traffic management decisions (e.g. the installation of roundabouts), hearing applications for sale of liquor licences, making Resource Management Act submissions on behalf of the council, and setting aside land for reserves or parks. A community board cannot be delegated the powers to make a bylaw or a rate.

Community Boards are unincorporated bodies, directly funded by the council. They cannot employ staff but are provided with administrative facilities and advice by the council.

Elected at the same time as the council, a community board usually consists of five or six members (often including one or more councillors).

Council Organisations, Council Controlled Organisations and Council Controlled Trading Organisations

Councils can set up organisations to undertake particular activities on their behalf or to acquire voting interests in an organisation outside the council. Councils can also appoint a director or trustee to an outside organisation. These may include companies, partnerships, trusts, an arrangement for sharing profits, unions of interest, cooperative, joint venture or similar arrangement. Different reporting rules may apply depending on the trading nature of the organisation (a council controlled trading organisation operates with the purpose of making a profit) and the level of council ownership (a council-controlled organisation is 50% or more owned by a council, either solely or with other councils).

  Council Organisation (CO) Council-controlled Organisation (CCO)
The organisation must:  
  • Prepare a statement of intent
  • Comply with Parts 1-6 of the Local Government Official Information and Meetings Act
  • Prepare half-yearly and annual reports
The council must:
  • Have a policy on appointment and remuneration of directors
  • Monitor the performance of COs
  • Have a policy on appointment and remuneration of directors
  • Monitor the performance of CCOs
  • Disclose information in long-term council community plan, annual plan and annual report

In addition to the reporting requirements above, councils use the special consultation procedure if they intend establishing a new council-controlled organisation (whether or not it is a council-controlled trading organisation) or acquiring shares in an existing council-controlled organisation.

Related Link: Office of the Controller and Auditor-General 2001, Local Authority Governance of Subsidiary Organisations