Local Government Minister Simon Watts has said he will consider intervening in Bay of Plenty Regional Council’s governance if it continues to restructure its $3 billion Quayside investment holdings.

However, Eastern Bay regional councillors say the council has done nothing to warrant such intervention.

“I don’t think Minister Watts is going to intervene.

“There’s nothing for him to intervene in,” said Kōhī Māori regional councillor Mawera Karetai.

“This is headline-grabbing behaviour from the National and Act Party members.

“There’s so much misinformation. It’s manufactured outrage. All the typical things you see coming up to an election.

“All we at [the regional council] are doing is undertaking a due diligence process, based on feedback from our community, and our councils.”

In the face of local government reforms that will see regional councillor positions dissolved, the regional council voted on June 25 to make amendments to its long-term plan.

The amendments would allow it to ringfence its Quayside assets into a new trust specifying what it can be used for in future, and restructure the Quayside board.

Watts wrote to the regional council on July 2, after being approached by Bay of Plenty mayors and MPs, suggesting it defer any decisions about the structure of its investment holdings. He also raised concerns about the loss of several independent directors of the Quayside board.

“If a satisfactory resolution to this matter can’t be reached, I am prepared to consider the powers at my disposal as the Minister of Local Government, including powers available to me under Part 10 of the Local Government Act 2002,” his letter said.

These powers extend to replacing elected members with a government-appointed commissioner.

Karetai said the directors’ terms on the board had been about to expire when the decision was made to reduce the number of board members.

Eastern Bay of Plenty regional councillor Sarah McCorkindale said the intent of the amendment was to keep the funds available for their original purpose.

“We want to make sure that the funds that have been set aside for regional benefit, remain for regional benefit, intergenerationally.”

In the 2024/25 financial year, the dividend from Quayside Holdings was $48 million – making up about 23 percent of the regional council’s total income. Without this income, regional council rates across the Bay of Plenty could have been an average $400 more per household.

The establishment of the fund went back to the 1989 local government reforms, when the regional councils were formed.

“The intent for that fund was for regional benefit and to support the delivery of regional council functions. It has been extremely well managed by Quayside to be where it is now,” McCorkindale said.

“As regional councillors, we have a responsibility to make sure that original intent continues.

“We consulted on this, and out of more than 200 submissions, the majority said, ‘we want that fund kept for the Bay of Plenty and for intergenerational benefit’.”

Most Bay of Plenty district and city councils initially made submissions in favour of placing the fund into a trust.

However, after the Government’s latest Head Start programme announcement in May, which gave further details and timelines around the reforms, they jointly wrote to the regional council asking it to pause its amendments.

At the time the regional council was consulting on the amendment, the Government had said that the regional councillors wouldn’t see out the current term of council, Whakatāne Mayor Nandor Tanczos said.

“Nobody knew how long they would be in place for, so there was a great sense of urgency.”

The Government had said regional council would be run by a Combined Territories Board, but had been unclear whether the board would be run by mayors or central government-appointed commissioners.

“No one knew whether mayors would even be in those boards and who would have what say,” Tanczos said.

“There was a fear among some people the Crown had its eye on those assets. No one knew what was going on so ... everyone was like, let’s ringfence it. Let’s keep the capital together.”

The May announcement gave local councils the opportunity to put in a proposal for what amalgamation might look like, which must be done by the second week in August.

“So we might know, fairly soon, what the structure of local government is likely to look like,” Tanczos said.

“Also, it’s now been confirmed that the regional councillors will see out their term. So they’ll have till 2028 to make any provisions. In that context, the urgency has kind of eased off a little.

“All the mayors were asking for was a pause. The regional council decided not to do that.”

He said there was no blame toward the regional councillors.

“Everyone wants what’s best for our communities. Everyone wants to protect those assets and make sure that they’re used properly.”

McCorkindale said the announcement in May had not changed the matter.

“The HeadStart process just changed the timeline. From where the regional council are sitting that’s not a change. It’s just more detail,” she said.