Archive | Councils

First value-for-money reviews point to $373 million of council savings

Auckland Council’s finance & performance committee will vote next Monday on the first recommendations from an assessment of whether it’s getting value for money from its various arms, including council-controlled organisations.

Auckland mayor Phil Goff.

Mayor Phil Goff welcomed the findings of the first group of reviews yesterday: “The reviews have identified potential savings of up to $373 million over 10 years. I expect the realised savings to be reinvested in vital services & infrastructure for Auckland.

“I instigated these reviews because elected representatives on council have an obligation to ensure that what we do is effective & efficient, and provides Auckland residents with the best value for the money they invest in us.

“With unprecedented population growth, Auckland has a massive need for investment in services & infrastructure to keep pace with this growth. Money is a scare resource and we need to make sure that we are getting the best return from what we spend.

“Auckland is New Zealand’s first council to review comprehensively & in depth the value for money in what it does. This is a legislative requirement under section 17a of the Local Government Act.

“The reviews are the culmination of months of work by council professional staff, with input from external experts in the areas under review and overseen by an independent reference panel.”

The reviews note that the council has already delivered efficiency savings for Aucklanders. However, they also noted that further integration of functions, shared procurement & services, clear performance measurement and better strategic & operational co-ordination could lower operational & capital expenditure considerably and improve services.

3 waters

The report notes that, through amalgamation, Auckland Council’s water services have delivered benefits to Auckland ratepayers saving hundreds of millions of dollars. However, Mr Goff said more could be done: “There is potentially $300 million in savings to be achieved through further integration, joint procurement & capital planning across the council’s 3 water services.

“$13 million of those savings could be realised immediately by combining operations & maintenance of our water & stormwater services, which I support.”

Communications & engagement

Mr Goff said it was to him during the mayoral campaign that there were issues with the structure of communications across the council group and the review clearly supported that: “I support a cut of at least 15% to the operating budget of communications & engagement over the next 3 years, and joint procurement between council & CCOs that in total represents potential savings of $54.5 million over 10 years.

“I cannot predetermine the outcome of next week’s committee, but I expect work will begin quickly across council & CCO communications functions to cut costs, improve co-ordination and to develop a group-wide strategy to address low levels of trust in the council.”


The reviews note that the council’s waste service has saved $165 million in operating costs since amalgamation and has a clear plan to reduce domestic waste, which the report said was working.

However, the report also concluded that the council’s waste service would “benefit from a broader business case methodology, and will also need to assess a shift of focus from residential to commercial & industrial waste, which accounts for 86% of all waste in Auckland.

“The environment & community committee will examine these recommendations, and it & professional staff will report back on changes which need to be made,” Mr Goff said.

International investment attraction & global partnerships

The review of council & CCO investment attraction & global partnerships found the functions were well organised & aligned, and business processes accorded with best practice. It recommends exploring a fee-for-service as a way to offset costs where direct personal benefits from the council’s activities can be identified.

The 4 reviews are the first tranche of a systematic value-for-money review process across the entire council group that will examine all ratepayer-funded functions & services during this term of council.

The second group of reviews is underway and includes the council’s group procurement and parks & open spaces. They’re due for completion early next year.

Auckland Council, finance & performance committee agenda Monday 6 November:
9, Value for money section 17A review programme
Three waters terms of reference
Three waters value for money (s17A) review report 2017
Domestic waste terms of reference
Domestic waste value for money (s17A) review report 2017
Communications & engagement terms of reference
Communications & engagement value for money (s17A) review report 2017
Investment attraction & global partnerships terms of reference
Investment attraction & global partnerships value for money (s17A) review report 2017

Attribution: Mayoral release, agenda.

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Council counts over $100 million/year in procurement gains

Deputy mayor Bill Cashmore says Auckland Council achieved $106.1 million in procurement benefits in the last financial year.

Cllr Cashmore, who chairs the strategic procurement committee, said on Thursday the council was a significant purchaser of goods & services and had started to deliver impressive results from process improvements.

“It’s an area where we are doing more to both save money & deliver sustainable benefits within our community. We’re doing this by teaming up with council-controlled organisations when we go to the market, reducing our costs in areas such as recruitment & software maintenance and through new technology that delivers greater efficiency.

“Last financial year, $29.5 million of additional value/year for the next 5 years was generated through our new maintenance contracts. 88% more trees will be pruned annually and significantly more weed control delivered across the region.”

Cllr Cashmore benefits included “sustainable procurement”, which meant leveraging off purchasing arrangements to deliver tangible social, economic & environmental benefits. One example is the Te Auaunga Awa (Oakley Creek) project, which saw the regeneration of one of Auckland’s longest urban streams, flowing from Hillsborough through Mt Roskill, Owairaka & Waterview to the Waitemata Harbour. The project also saw 17 young Aucklanders recruited into training.

“Our procurement approach is maturing and it’s great to see these results being delivered for our communities & ratepayers. There is a lot of potential for the council to use its purchasing power wisely and deliver broader benefits to our communities. We will continue to build on these benefits.”

Attribution: Council release.

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Kaipara election dates set

Kaipara’s election to replace mayor Greg Gent will take place from Friday 26 January to midday on Saturday 17 February, which means the postal vote will close on the first day the election can be held.

Mr Gent, elected last October when an elected district council resumed control after 4 years of management by Government-appointed commissioners, announced on Monday he’d resign in November.

The council said today Mr Gent’s resignation would take effect on 15 November, 5 days before summer election rules come into play.

“Under the Local Electoral Act, where a vacancy occurs before 20 November 2017 the by-election cannot occur before Saturday 17 February 2018. Under this scenario, nominations would open Friday 24 November and close at midday Friday 22 December. The voting period would be from Friday 26 January through to midday on Saturday 17 February, conducted by postal vote.

“The public notice of the result would be Wednesday 21 February  and the newly elected mayor could take office at that time. The estimated cost for the by-election is $38,000. The bulk of this cost is for the production & distribution of the mailer & voting document.

“If the newly elected mayor was an existing councillor then they would have to resign the councillor role and this would trigger an additional vacancy & by-election. The cost of this is likely to be around $20,000.”

Related story today: Kaipara mayor resigns after a year

Attribution: Council release.

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Kaipara mayor resigns after a year

Kaipara mayor Greg Gent.

Kaipara mayor Greg Gent announced on Monday he intended to resign after the council meeting on Tuesday 14 November – 13 months after an elected council took over from Government-appointed commissioners.

He said he’d decided to resign due to unspecified personal reasons. His resignation will mean a by-election is required, but it can’t be held until February.

The Kaipara District Council said deputy mayor Peter Wethey would assume all the responsibilities of the mayor from Mr Gent’s departure until the by-election.

Mr Gent, a Ruawai dairy farmer with substantial business & corporate governance interests, was a director of New Zealand’s largest co-operative business, Fonterra from 2001-11 and chaired Northland Dairy Ltd & Kiwi Co-op Dairies Ltd before Fonterra was formed. He still chairs Dairy Holdings Ltd, has chaired the Southern Cross Health Trust since 2014, is a director of NZ Institute for Plant & Food Research Ltd and was a member of the Northland District Health Board from 2010-15. He was independent chair of Pengxin NZ Farm Management Ltd from 2013-October 2016, and resigned as a director of FMG Insurance Ltd on 17 August. He was made an officer of the NZ Order of Merit in 2012.

Mr Gent chaired the 3-member review team that led to councillors resigning in 2012, when the commissioners took over, and said in a pre-election statement: “That gave me a unique insight into council, particularly around the systemic failure of governance. I do not want us to slip back into the hole that we have spent the last 4 years climbing out of.”

He also said at that time: “The role of mayor will require me to reduce my current portfolio, which I am prepared to do.”

He gave up one board seat at election time and one since.

Mr Gent was not surprisingly criticised by the Mangawhai Ratepayers’ & Residents’ Association & its chair, Bruce Rogan, for his role in the appointment of the commissioners, who opposed every attempt by the association for redress over the imposition of rates to pay for the Mangawhai Ecocare sewerage system after its cost blowout was exposed. The district council secretly borrowed $58 million for its capital cost and Parliament passed a Validation Act as the association was heading to court for a judicial review.

Mr Rogan stood unsuccessfully against Mr Gent for the mayoralty last year.

Attribution: Council release.

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Ratepayers get small court victory in scrap over Mangawhai sewer scheme levies

High Court judge Ailsa Duffy has brought to an end an episode in the scrap over the secretively funded & heavily over cost Mangawhai Ecocare sewerage scheme.

The Mangawhai Ratepayers’ & Residents’ Association & its chair, Bruce Rogan, fought the imposition of rates to pay for the sewerage system after its cost blowout was exposed – the district council secretly borrowed $58 million for its capital cost – resulting in a Validation Act being passed as the association was heading to court for a judicial review.

In 2014, Justice Paul Heath found the Validation Act passed to make those rates lawful did just that – made them lawful.

Some ratepayers, led by Mr Rogan, refused to pay Kaipara District Council rates, and refused to pay Northland Regional Council rates when they discovered the regional council had no authority to hire the district council to collect them.

Justice Duffy found in an interim judgment that these regional council rates were unlawful. In a second judgment on that case yesterday, she quashed the regional council’s rates for the rating years 2011-12 to 2015-16 and also set aside the penalties imposed for non-payment.

However, she said the ratepayers’ association & Mr Rogan hadn’t sought reimbursement in their claim and she made no order directing the regional council to refund the relevant rates & penalties.

Attribution: Judgment.

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Governance framework review a leading topic for local boards

In this round of local board meetings, all boards will consider the governance framework review (links taken from the Orakei Local Board agenda for its meeting on Thursday):

12, Governance framework review recommendations  
Summary table of report recommendations    
Regional decision-making and policy processes    
Allocations and delegations    
Reserve Act land exchanges    
Local boards and Auckland Transport    
Confirmation of draft transport recommendations    
Waiheke Local Board pilot project cover paper    
Waiheke pilot project outline    
Funding and finance workstream paper 1    
Funding and finance cover paper July    
Funding finance description of 2 models    
Number of local boards    
Representation options    
Naming conventions

Who gets the name Wesley?

The Puketapapa Local Board will return this week to the topic of where in Auckland the suburb name Wesley should be used:

12, Notice of motion, official naming of Wesley suburb
Notice of motion, official naming of Wesley suburb    
Wesley boundary map 

Airport access

The Puketapapa board also has airport access – light or heavy rail, and the route – on its agenda this week:

17, Airport access
Benefits of LRT and heavy rail to Aucklanders    
Auckland Transport board resolution    
Progression pathway

Three Kings plan change

And the Puketapapa board has a request for its view on whether a plan change request from Fletcher Residential Ltd to amend the Three Kings precinct, and to rezone some land within the precinct, should be accepted as a private plan change or adopted as a council plan change.

The council’s planning committee will make the council decision on how the plan change request will be treated.

21, Plan change proposal for Three Kings precinct 

Sediment discharge

After a submission from the Friends of Okura Group, the Hibiscus & Bays Local Board has received a report on sediment discharges from the Envirofill cleanfill site at 1627 East Coast Rd at Redvale, and the Weiti village development nearby, which has concluded the developments meet their consent conditions.

12, Envirofill & Weiti developments, sediment discharge inquiry

Attribution: Local board agendas.

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Transparency campaign gathers some ears

Transparency campaigner Penny Bright took her message to Auckland Council yet again yesterday.

Yet again, in a campaign that she’s fought for 2 decades, resulting in multiple arrests for her (some of those arrests spitefully contrived but not, subsequently, resulting in convictions), but over the years not too much improvement in transparency.

But it was notable at yesterday’s meeting of the council’s finance & performance committee that fewer ears were deaf to her message, and this time Ms Bright actually had some positive words to say about the opening up of council information.

The need for a change in attitude was reinforced in February with the sentencing on corruption charges of former Rodney District Council & Auckland Transport senior manager Murray Noone to 5 years’ jail, and engineering firm Projenz Holdings Ltd director Stephen Borlase to 5½ years’ jail over roading contracts.

Mr Borlase was found guilty on 8 corruption & bribery charges and Mr Noone was found guilty on 6 charges of accepting the bribes. Projenz also paid for overseas travel for Mr Noone and another senior roading engineer, Barrie George, who was sentenced last September to 10 months’ home detention.

Ms Bright told the committee she wanted to see all council-controlled organisations providing the same details of contracts as Auckland Transport now does, and she wanted subcontracts included.

She told the committee: “The court case proved you have 2 levels of corruption, public to private and private to private where back-end subcontracts are placed.

“The court showed the collaborative model was not working. That must also be reviewed because the proven corruption risk – we have the evidence for that.”

Ms Bright said the Public Records Act had been law since 2005 – created, according to the Government summary, “to support the effective management of records in the public sector… to promote government accountability through reliable recordkeeping, enhance public confidence in the integrity of government records…”

She said more recent guidelines from the Office of the Auditor-general on transparency were very clear and added: “I believe those guidelines have not been enforced.”

She also asked when the council would look at council officers holding private consultancies that dealt with the council.

Council chief financial controller Sue Tindal said the committee would have an opportunity to raise questions about these issues at its second meeting of the week, on Friday, when the quarterly reports of council-controlled organisations are presented.

However, that’s an unnecessarily tortuous process. The council could simply revert to the practice used at the former Waitakere City Council of presenting all details from tenders online when a tender was approved, which wasn’t followed at other councils around the region and wasn’t the practice put in place when Auckland Council was formed in 2010.

Office of the Auditor-general guidelines

Attribution: Council committee meeting, public forum presentation.

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Council signs off on new-style maintenance contracts

Auckland Council has taken its facilities, tree & ecological maintenance contracts through 2 committees in the last 10 days, finalising a process that began last July, and will sign new contracts this month. The contracts will take effect on 1 July.

The process, called Project 17, will replace procurement agreements signed in 2012 and, community facilities general manager Rod Sheridan said, would bring improvements & savings worth $30 million to the council.

Mr Sheridan & procurement general manager Jazz Singh told the council’s finance & performance committee in a report on Thursday the council had 26 contracts for the supply of these services around the region. Service delivery was duplicated under 20 of them.

They said inconsistencies in facilities maintenance service delivery – due to both internal (different ways of doing things between teams/departments) & external (contract scope/contractor delivery) factors – had long been identified.

“These issues & challenges, under the contracts entered into by council in 2012 following the last major procurement of the facilities maintenance contracts (Project Genesis), included:

  • Duplication in the delivery of services under 20 existing contracts
  • Prescriptive contracts that were not delivering added value
  • Unco-ordinated approach to the management & delivery of services, with multiple contractors delivering across multiple service lines in the same geographic areas
  • Lack of co-ordination in the delivery of services across the council family
  • Inefficient procurement & delivery of minor capital expenditure renewals, and
  • Lack of good quality asset information in a centralised register together with an associated asset condition assessment.”

Local boards & other stakeholders told the Project 17 team that issues for them included:

  • Lack of consultation & engagement with local boards regarding the outcomes from the service delivery
  • Lack of accountability, and
  • Service levels weren’t aligned with local boards’ objectives & requirements.

Service areas align with board boundaries

The new contracts will cover the whole Auckland region, but are structured in service areas aligned with local board boundaries.

The council’s strategic procurement committee (as it’s been renamed) approved supplier recommendations on 24 March and sent them to the finance committee on Thursday for the final tick.

The council will release costs & a full list of successful suppliers at the end of April, once all contacts have been signed.

Mr Sheridan said the procurement process wasn’t about doing the same thing with different suppliers: “Instead, it was about doing something bold & different that would move Auckland closer to being the best performing city in the world.

“The involvement & support of our local boards has been integral to the procurement process, and we sought boards’ input in deciding service levels, the proposed geographical areas & smart procurement outcomes. We need to ensure that everything we do is locally driven & customer-centric.

“We are excited about the innovation this opportunity offers, and using technology to take us into the future. We will be able to empty bins before they overflow by installing sensors and will install counters on public toilet doors to monitor use & schedule cleaning.

“This procurement process has been about ensuring the suppliers who will maintain Auckland’s assets over the next 5 years or more will deliver value for money for ratepayers.

“This is an example of Auckland Council making our size work and, in addition to that, better managed & maintained assets will ultimately lead to further cost savings. We have added $30 million worth of value to the organisation.”

Streamlined service

Finance committee chair Ross Clow said: “From 1 July, Aucklanders can expect to see more responsive, streamlined local maintenance services. One supplier will now manage the cleaning of a public toilet and, while they’re at the site, will ensure bins are emptied, lights fixed, and gates & doors locked or unlocked. Until now, this has been done by different suppliers under different contractual arrangements.

“The procurement process included provisions on standardising service levels across Auckland, introduced key performance indicators to ensure consistent, high quality delivery, and asked suppliers to commit to their communities by using local staff, offices & depots wherever possible.”

The council will continue to manage local suppliers on Waiheke & Great Barrier Islands through its community facilities department.

Project 17, Auckland Council maintenance contracts

Earlier story:
13 March 2017: Council maintenance contract decision process enters final stages, Panuku report, home fires bylaw

Attribution: Council agendas, release.

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Council maintenance contract decision process enters final stages, Panuku report, home fires bylaw

Auckland Council is nearing the end of a long process to reorganise its maintenance contracts for parks, council buildings & open space, called Project 17.

Preferred suppliers were identified last Friday and the council’s community facilities department is taking its proposals to local boards over the next fortnight, starting with a session at the local board chairs’ forum today.

The material before local boards is extensive, set out in 8 documents:

Attachment 1, political engagement timeline
Attachment 2, local board resolutions (September 2016)
Attachment 3, standard & enhanced assets
Attachment 4, full facilities contract service specifications
Attachment 5, supplier-specific information (in confidential agendas)
Attachment 6, contractor performance balanced scorecard
Attachment 7, tupuna maunga values specification
Attachment 8, contract information (in confidential agendas).

According to the schedule outlined for local boards, the council’s strategic procurement committee is set to make its recommendations on supplier contracts at the end of next week, so the finance & performance committee can agree suppliers, pricing & baseline service levels the following week.

In April, as part of the council annual plan process, local board workshops will be held to discuss locally driven initiative funding priorities, which may include recommendations to enhance maintenance service levels.

In another round of workshops at the end of April & early May, local boards are scheduled to agree local service level priorities.

Public submissions on the council’s annual plan close on Monday 27 March.

The council governing body will meet on 31 May-1 June to finalise its 2017-18 budgets, and new maintenance contracts will start on the first day of the new financial year, 1 July.

In other material before local boards over the next fortnight:

Panuku reports on Wynyard, waterfront strategy & own lease

The first tenants have moved into the Mason Brothers building in the Wynyard Quarter. The building is part of stage 1 of Precinct Properties NZ Ltd’s programme of developing commercial sites in the quarter.

Council organisation Ateed (Auckland Tourism, Events & Economic Development Ltd) has taken the head lease on the neighbouring new development of 12 Madden St for the establishment of Grid AKL, the coworking space for innovative business & startups. It’s scheduled for completion in July.

Panuku Development Auckland’s lease on its Westhaven office expires mid-year, and the organisation says it’s likely that it will be more cost effective for Panuku to move to a modest-quality building in the cbd rather than remain in its current building.

Panuku is working on a refresh of the waterfront strategy, which will frame future development within the cbd waterfront area. It will be report to the council on the strategy this month, and draft framework plans will be reported in May.

Home fires bylaw

The council publicly notified the draft air quality bylaw for indoor domestic fires on 27 February, and public submissions close on Monday 27 March.

Local boards have been given until Monday 3 April to send in written submissions, and can give oral submissions at a local board hearings session scheduled for Wednesday 19 April.

Project 17, Auckland Council maintenance contracts
Grid AKL
Draft air quality bylaw & statement of proposal

Attribution: Council agendas.

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A weighty 3 days for Auckland councillors

Auckland Council’s politicians enter day 2 today of 3 days of weighty issues to start the third term of the council.

The planning committee met yesterday, the finance & performance committee gives its first consideration today to mayor Phil Goff’s proposal on the annual budget, and tomorrow the regulatory committee has a number of issues to consider.

I’ll run more extensive reports later in the week on all 3 meetings. For the moment, below are some of the questions resolved at the planning committee meeting:

The committee agreed to lodge an appeal in the High Court against conditions in a KiwiRail designation concerning crossings on the long-proposed Avondale-Southdown railway line.

The committee agreed the council should make a submission on the NZ Transport Agency’s proposals for the East-West link between State highway 1 at Mt Wellington & State highway 20 at Onehunga, set up a political reference group to deal with urgent issues during the hearing, then expanded the reference group because a number of other councillors wanted to be on it.

A political reference group was also set up on the northern corridor improvements project, which is the final piece of the Western ring route jigsaw.

The committee debated whether the housing accord should be extended to allow for the last special housing areas to remain covered by it, instead of falling under the regulations of the new unitary plan, but eventually went with an extension.

Attribution: Committee meetings.

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