Fran O'Sullivan: Who's going to be calling the shots in Auckland?

John Key has opted for the "pressure makes a diamond" motto by imposing a winner-takes-all solution on Auckland.

Key didn't exactly spell it out, but one of the imperatives driving his Cabinet is the necessity to not only have a strong Auckland Council in place by the end of next year, but to somehow ensure the implementation of the raft of plans that need to be in place so New Zealand can capitalise on the 2011 Rugby World Cup event.

At ministerial level there are concerns that Auckland is not (yet) in the right space to leverage the event to maximum economic advantage. This suggests Key's ministerial team will be a major driving force within Auckland for some time to come.

This is not new.

For instance, former Finance Minister Michael Cullen - who announced he was bowing out of national politics yesterday for a new career in Treaty of Waitangi negotiations (from the other side) and directorships on State Owned Enterprises - drove Auckland passenger rail developments from Cabinet level after years of stasis at local level.

Cullen provided the necessary acceleration and cut-through to get Auckland moving using the power of the Government's purse to buy Tranz Rail out of the Auckland market.

It was also the previous Government which had the courage to appoint the Royal Commission on Auckland Governance in the first place. But it's a moot point whether Labour would move in quite so radical a fashion as its successor.

By scuttling the royal commission's recommendation for six local councils to tuck under the new Auckland's super city in favour of a proliferation of local community boards, Key has opted to kick power upstairs so change can happen faster.

But even before the ramifications of the Prime Minister's proposals had sunk in, disaffected constituencies - like the Maori MPs with whom his Government has formed a loose working arrangement - were carping at Cabinet's decision not to adopt the commission's recommendation to reserve three specific seats at the new Auckland Council table for Maori.

This is a gutsy move.

It is probably also the correct one given that on current population projections other ethnic groups such as Asians and ultimately Pacific Islanders will soon outnumber Maori in the Queen City.

But the problem is that it quickly became a lightning rod overshadowing other issues at Key's press conference.

He will get a second bite at the cherry - possibly later in the month - when the Government announces the makeup of the establishment board that will drive through the necessary change so the new governance structure is in place for the October 2010 local body elections.

The importance of the makeup of that body cannot be overstated. It will need to incorporate people with strong governance ability to ensure the structure for the new council is in place before the elections.

But it also needs to negotiate with current members of the existing councils and regional council to ensure good will and services are maintained while the shakeout takes place and an interim CEO is found.

The Government is playing its cards closely here.

Behind the scenes several names are being promoted for the establishment board, among them Sir Ron Carter, the long-term champion of the Committee for Auckland; Oxford University's John Hood, who was an active driver for a competitive Auckland; NZ Post's John Allen; Fletcher Building chairman Roderick Deane and Deloitte chairman Nick Main.

A Waterfront Agency will also be set up to drive the development of Auckland's shabby waterfront.

But the key issue will be which party calls the economic shots - central Government or Auckland. An economic development plan will be developed for the Auckland region. But yesterday Key could not shed any clarity on just who would make the crucial decisions on this score.

The commission's recommendation for a regional economic development agency does not feature in the Governmental decision-making blueprint released yesterday.

All Key and Hide are saying is that there will be an economic development plan to guide decisions. Questioned further on just which party will be the deciding factor - the Government or the new Auckland Council - the most either could say was that this will be the subject of discussion at Cabinet level.

This is one area where the Government needs to tread carefully.

A high-powered incoming Auckland Council - particularly one driven by a charismatic and powerful mayor - is not going to neglect the huge amount of work that has already been done by the region's existing economic development agencies.

For instance, it was Waitakere City which decided to invest in special film production studios which are now a haven for international producers. Other councils also have well-developed plans.

The Government blueprint suggests the Auckland City will own and operate major facilities and events.

But just being an asset manager will not be sufficient for Auckland's movers and shakers - many of whom are from the business community - who are wanting to emulate the type of success Brisbane has had in the economic development sphere.