Prime Minister John Key has promised that Government will not force councils to merge into "Super Cities'' as part of major reforms of local government.
In a speech at the Local Government New Zealand conference in Queenstown this morning, Mr Key said the Better Local Government law changes before Parliament would create the capacity for councils to amalgamate.
"I have made it quite clear the Government will not force any amalgamations but we want to enable communities to be able to genuinely debate whether it is the right move for their community or not,'' he said.
Mr Key said the creation of a Super City in Auckland had "worked well'' because it had cut costs, reduced bureaucracy and allowed Auckland Council to achieve more through as a single entity.
The proposed law changes reduced the barriers to council mergers.
If an amalgamation of councils was proposed, a majority of the total affected residents would have to vote in support of the merger for it go ahead.
At present, a majority must be found in every separate district affected by an amalgamation.
To force a vote of opposition against a merger, 10 percent of affected residents would have to form a petition.
Mr Key also told local government leaders in Queenstown that councils needed to play their part in reducing debt in a difficult economic climate.
"Times are tight and ratepayers just can't endure unaffordable rates rises. We are not telling you how to do your jobs, but we would urge you to think carefully about the capacity of your communities during these difficult financial times.
"I know it's not easy, and it's tempting to think your council is an exception or faces special circumstances, but we all have to face up to making difficult choices.''
The local government reforms were being introduced in two bills. The first bill, which redefined the role of councils, was expected to be passed in September.
Mr Key said: "The intention of these reforms is to provide clarity around the role of councils, stronger governance, improved efficiency, and more prudent financial management.
"The purpose of local government, as stated in the Local Government Act of 2002, created impractical expectations about what councils could achieve and confusion over proper roles with respect to central government and the private sector.''
The second phase of reforms, which would be introduced next year, would look at the framework around central and local government regulatory roles, review development contributions and investigate efficient infrastructure provision.