The Press Council has not upheld a complaint lodged by Meaghan Miller, Communications Manager for the Queenstown Lakes District Council (QLDC), against the weekly newspaper Mountain Scene (‘The Voice of Queenstown’) arising from the newspaper’s treatment of issues to do with Council finances.

The Complaint
Ms Miller, on behalf of the QLDC, complained to the Press Council on 11 April, citing a piece in Mountain Scene of 29 March which described QLDC operating surpluses as ‘profit’ (a front page article, ‘QLDC coins it’ of 26 January drew on the same word). In a letter to the editor on another subject in the same 29 March issue Ms Miller had stated that a new Aquatic Centre had not been funded from rates but from payments by developers and council land sales. An ‘Editor’s Reply’ to this letter claimed that these monies should have gone to rebates on rates rather than the Aquatic Centre.

With the agreement of the editor, Ms Miller submitted a letter pointing out that the council is a not-for-profit organisation and that there are legal impediments to the use of miscellaneous funds for relief of rates. She stated that to describe the surplus, which is already allocated to capital expenditure and loan repayments, as “profit” is not correct.

The editor said he had not yet decided whether the newspaper would make further comments. Ms Miller said QLDC would have entered into further negotiation if the newspaper had shown its hand on this point.

In the event Ms Miller’s letter, as agreed, was published in the next edition on 5 April, alongside another letter from the chair of the QLDC finance committee, both under the headline, ‘QLDC claims rates cannot be cut’. In the same space, marked ‘Opinion’, another ‘Editor’s Reply’ asserted that the council’s operating surpluses represented ‘obscenely high profits’ and claimed that the funds from land sales and developer contributions could have been used to offset rates increases.

Ms Miller contended that since she had in her letter to the editor rebutted these assertions, the newspaper - through this further ‘Editor’s Reply’ - had deliberately chosen to mislead readers for a second time. Moreover, the headline ‘QLDC claims rates cannot be cut’ did not fairly represent the context of her letter. QLDC felt compelled to complain to the Press Council to “avoid further ill-informed misinformation appearing in the newspaper”.

The Newspaper’s Response
The editor of Mountain Scene noted that the letters from Ms Miller and the Finance Committee chair as published on 5 April were largely taken up with reasons why QLDC could not use developer funds to cut rates and could not make a profit from rates, which in turn justified the headline, ‘QLDC claims rates cannot be cut’. Ms Miller’s letter of 11 April had also said that running this headline when the council had asked for submissions as to how to reduce rates, had been unhelpful. The editor submitted that the council had asked for contributions to debate on the matter and the newspaper had complied.

Ms Miller had also raised a substantial point by calling in question the newspaper’s treatment of a request to correct misleading information. In response the editor cited the Press Council’s Principle 2 ‘Corrections’. He contended that what had been published had not been found to be materially incorrect as required by Principle 2. Ms Miller had been given the opportunity to make the council’s case to the effect that developer funds and proceeds from land sales could not be set off against rates. Mountain Scene had acquired other information giving a contrary view - that such monies could be applied to basic infrastructure programmes, usually financed by raising loans, and that this procedure in turn could lead to savings on rates, since interest would not have to be paid.

Ms Miller appeared to concede this point in general in her letter dated 23 May, noting that while the council could not simply apply the developer contributions as a general rate reduction tool, they did have a significant positive effect on rates by providing funding for tagged projects [which would otherwise be funded through borrowing]. In the case of the aquatic center (which the community had clearly said they wanted) the funding had been provided by tagged contributions which must then be spent on that project.

The Press Council is not going to get into a discussion of the ins and outs of council financing. The issues here are to do with the role of a local newspaper in casting light on matters of local governance. QLDC clearly has much on its plate, as a consequence of rapid regional development. At the same time there can be no doubt that, with rates rising, vigorous analysis of the way the council is doing business is a service to the community.

Mountain Scene has applied a blunt instrument in its coverage of these issues. An adversarial tone is evident. The use of the emotive word ‘profit’ to describe annual budgetary surpluses is a case in point. Some members of the Press Council are inclined to the view that the use of the word profit to describe funds which have not been spent in a financial year but have clearly been allocated to an on-going project is, at least, mischievous and would caution against its use. However, the QLDC was given the opportunity to clarify the issue in a letter to the editor.

The newspaper has been doing its job in drawing attention to large surpluses carried over by the council in recent years and it has raised legitimate questions about the use of funds, not derived from rates, for the relief of ratepayers. The editor noted that the council has not cited legal chapter and verse as to why his suggested approach is not permissible. The newspaper has, from its own investigations, found other authorities to refute the council argument.

There now seems to be some meeting of minds on this issue and the Press Council makes no ruling.

All this – rather than misleading readers - promotes discussion and contributes to understanding of a fast-changing local scene. It is no doubt exasperating to officials that a newspaper is able – through the use of such a device as an ‘Editor’s Reply’ – to change the focus of a debate and keep up the pressure. Nevertheless the key issue is whether the wider community interest is thereby served. The Press Council finds nothing to suggest otherwise in this case.

The Press Council does not uphold the complaint in relation to the headline or as concerns the proposition by the council that the newspaper is guilty of publishing misleading information requiring correction.

Press Council members considering this complaint were Barry Paterson (Chairman), Aroha Beck, Ruth Buddicom, Kate Coughlan, Penny Harding, John Gardner, Keith Lees, Denis McLean and Alan Samson.

Clive Lind took no part in the consideration of this complaint.


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