Auckland City Deal now needs to walk to talk

Much was made of Auckland’s mayor and the Prime Minister signing what’s known as the Auckland City Deal in April, the country’s first city and regional deal. But what exactly is a city deal, what can we expect of it, and what difference will it make?

City and regional deals are agreements between central and local government that provide policy commitments in support of housing, transport and wider areas of economic development. Such deals have emerged in the UK and Australia and are often linked to a concern for greater local control and decentralisation (local leaders making decisions for their own areas).

The Auckland Deal marks the culmination of a sustained period of negotiation, after three regions were shortlisted by the New Zealand Government in 2025. We can see the political salience of Auckland, along with the city-region’s economic size, coming into play in its selection.

Responses to the deal have been mixed. Critics argue there is too little that is new or additional in the deal; it’s more about agreement to talk rather than decision-taking now.

Indeed, the deal as it stands shows faint resemblance to deals elsewhere, where funding and decentralising steps are set out more clearly (typically). The Auckland deal outlines a suite of policy areas, yet it comes across mainly as a statement of intent.

The more optimistic would argue that the deal has the potential to build and repair relationships between local and central government; the lack of trust between the two was clearly identified in the Future for Local Government review of 2023.

It should be considered, furthermore, that few city deals across the OECD have achieved a step change in economic performance at the first pass. In New Zealand, the Greater Manchester City Deal (agreed in 2012) is often pointed to as an exemplar of sorts, yet economic transformation here remains contested. For every example of a deal that appears effective, there are many more where the impact has been marginal or has yet to clearly emerge.

One clear conclusion from the story of change in Greater Manchester, however, is the importance of not just signing one deal, but generating long-term, cross-stakeholder working. Such collaboration has supported a series of deals, alongside the building of associated relationships, over the past decade and a half.

We’d be best therefore to consider successful local decentralisation as a process not a one-time event, and this was the way deals – as part of a wider localism agenda – were originally framed in the UK.

So, what do we look for now? It appears the ‘implementation plan’ for the deal will need to perform the heavy lifting and give further detail on what the parties are committing to. How initiatives will be resourced and in what ways potential revenues may be allocated will be central to determining effectiveness.

The broad sentiments and focus areas in the deal reflect a conventional view on some of Auckland’s economic development challenges (congestion charging and a Waitemata crossing are noted, for example), but how this translates to prioritisation will need some detailing.

It will also be interesting to see if the deal can move beyond a somewhat narrow focus on infrastructure to wider long-term economic change, which we would argue is core to the success of the deal. A deal presents an opportunity to consider the inter-linking dimensions of the Auckland economy.

City-regions certainly need physical and infrastructure systems to function, yet skills pipelines, innovation ecosystems and partnerships with higher education institutions warrant attention too. The most effective deals have been able to bring together key stakeholders – including universities – to play key roles in the deal-making process itself. Roles here range from supporting scrutiny processes for the deal programme, to actively engaging in aspects of project delivery (for example, on innovation).

In terms of focus, additionally, it is notable that the deal has very little to say about inequality within Auckland. The agreement does recognise different growth areas in the city-region – for example, Drury in the south and the city centre. However, growth is largely treated as an end in itself, and a discussion of who benefits and who misses out does not feature explicitly.

Furthermore, given that Auckland is the largest Polynesian city in the world, it was perhaps striking that little was said here about future policy prospects. A deal cannot do everything of course, but areas left out are revealing in and of themselves (as it may indicate who has had a say or voice in the process).

Drawing on our ongoing research work on urban governance and contractual approaches (including deals) across the OECD, we suggest the following principles would help the deal-making process in Auckland as it progresses:

First, central government and Auckland stakeholders need to develop shared, transparent evidence to monitor what the city-region’s evolving needs and priorities are.

Second, flexibility will be crucial and stakeholders will need to adapt when an initial proposed policy can no longer go ahead (the deal recognises this). Considering how this happens based on evidenced positions – for example, project feasibility – as opposed to political whim, is key here.

Third, ensure that local voices matter. Indeed, how can local stakeholders have a meaningful voice in how the new Ministry of Cities, Environment, Regions and Transport will take form? This relates to how decisions are made and how accountability works. Without that, promises of decentralisation risk ringing hollow.

The Auckland City Deal is the first of its kind in New Zealand, and that is significant. Whether it reshapes how the ‘Super City’ is governed (or doesn’t) will depend less on what has been signed, but what happens next.