A striking feature of local government reform in many Commonwealth countries has been a heavy reliance on structural reform, often in the form of forced local council amalgamation. This paper argues that the long-run success of structural change in local government hinges on several key factors, not least that voluntary rather than compulsory council mergers have a far greater chance of success. A second key ingredient resides in a high degree of local autonomy in both the composition and operation of decentralized governmental functions. A third vital factor lies in ensuring that revenue and tax assignment is sufficient to provide local government with financial autonomy. Finally, adequate powers of taxation need to be accorded to local government and this requires careful consideration of the types of taxes most suited to local government.

Since 2000 intergovernmental relations in New Zealand have been evolving rapidly as a result of a significant shift in government policy discourse towards a strong central-local government partnership. New statutory provisions empowering local government to promote social, economic, environmental and cultural wellbeing have significant implications for the range of activities in which local authorities are engaged. In turn, this has consequences for the relationship between local government and central government. The effectiveness of the new empowerment and the prospects for further strengthening of the role of local government are critically examined. Despite some on-going tensions, and an inevitable mismatch in the balance of power between central and local government, it is argued that there is a discernible rebalancing of intergovernmental relations as a result of new legislation and central government policy settings which reflect a ‘localist turn’. On the basis of developments since 2000 it may be argued that the New Zealand system of local government is evolving away from the recognised ‘Anglo’ model. However, further consolidation is needed in the transformation of intergovernmental relations and mechanisms that will cement a more genuine central-local government partnership.

The Commonwealth Local Government Forum (CLGF) Pacific Project works with local government and other stakeholders in nine Pacific Island countries – Cook Islands, Fiji Islands, Kiribati, Samoa, Papua New Guinea, Solomon Islands, Tonga, Tuvalu and Vanuatu. It seeks to strengthen local democracy and good governance, and to help local governments deal with the increasing challenges of service delivery and urban management in the unique Pacific environment. Human settlement patterns in the region are changing rapidly. The Pacific has traditionally been a rural agricultural/subsistence society, but this is no longer the case. The accelerated pace of urbanisation has impacted significantly on Pacific nations and in the very near future the majority of Pacific Islanders will be found in urban areas. Already over 50% of Fiji’s population are urban dwellers. Rapid urbanisation brings with it unique challenges and opportunities. Local governments are at the forefront of this phenomenon, with the responsibility to manage urban development and the transition from rural areas to cities and towns. Their success or failure to manage urbanisation and provide the required levels of physical and social infrastructure will affect many lives in a new urban Pacific. The project now has three components – the main Pacific Regional Project and two country-specific programmes: the Honiara City Council Institutional Capacity Building Project and the Commonwealth Local Government Good Practice Scheme in Papua New Guinea.

"Vice-chancellors have a responsibility to get down and say that we're prepared to reform the sector in the following sensible and constructive ways … rather than going back in a traditional way and saying, 'Give us more money and leave us alone'. We will get nothing simply by asking for more money.” The Australian Labor Party went to the 2007 election promising a new era of cooperative federalism that would end the ‘blame game’ between federal and state governments and re-energise reform and productivity agendas. On the evidence of the Council of Australian Governments (COAG) meeting on 26 March 2008, these agendas are advancing rapidly. The communiqué foreshadowed a raft of new commonwealth-state agreements, streamlined arrangements for special purpose grants and, perhaps most significantly, performance criteria for payment of at least some of those grants.2