John Tamihere: Shine a light on these costly creations

Columnist John Tamihere believes it's time to get clear disclosure about spending by Auckland Council-controlled organisations. Photo / Doug Sherring.

COMMENT: The recent announcement by the Ports of Auckland that they have achieved consent to build a 17 metre five-storey car park to host imports has rightly caused an outcry among Auckland citizens.

In a June 4 2016 Herald article by Lincoln Tan, Phil Goff, who was on the mayoral campaign trail is quoted as saying: "My commitment is to restore Aucklanders access to this prime waterfront site, so that people, rather than imported cars get to enjoy its natural beauty."

Fast forward to November 2, 2018 to another Herald article by Simon Wilson. In it Simon says Goff says "I am expressly forbidden from interfering with the commercial decision making of the Port."

The ratepayer, through Auckland Council, owns the land and the company that runs the Ports of Auckland.

The council, as elected by the citizens, also appoints - and disappoint - the 8-member board that runs the Ports of Auckland. It is as simple as that.

But wait there's more. Simon says, in this article, let's blame Roger Douglas and his reforms from the 1980s for this predicament.

He would have you believe that the Ports of Auckland have been an independent company, owned in name only by the ratepayers for 30 years. If you believe that, I'll pay for your professional assistance. In addition, laws can be changed.

In another Herald article on 6 September this year, Bernard Orsman wrote: "Auckland Council's development arm (Panuku) has hired a partner and a second lawyer from a big city law firm at ratepayers' expense to fight its masters at council in court."
Are these Council-controlled organisation's out of control?

This column is about attempting to identify who actually controls Auckland City and the massive council-controlled organisations.

If what Mayor Goff says is truly held by him, then he has in my view abdicated any responsibility over virtually every major relationship the city has with its citizens.

I took this opportunity to screen every one of the six CCO annual reports and I'm deeply concerned at the significant lack of disclosure in those reports as to how $1.049 billion is expensed per year.

That figure comes from adding non-disclosed costs.

For example ATEED personnel costs are $21,857,000 yet their business expenditure was double that at $44,099,000. Auckland Transport had personnel costs of $123,578,000 but "other expenditures" of $668,689,000.

Panuku refused to disclose their numbers. Watercare had personnel costs of $69,332,000 but other expenditures of $144, 148,000. These figures are all about labour costs and not capital.

Alongside this, I would ask you to look at the graph and note that the mayor earns $200k less than one of the six CEOs and up to $500k less than the best-paid doyen.

I make the point, as usual, that every one of these chief executives and their council-appointed boards administer monopolies supported by the power of regulation.

They often try to make out that they are private sector and in a competitive environment. They manage and dispense significant authority and power, and if used in the wrong way, they can never be held to account.

The other notable thing about the numbers from the annual reports is that not one of the council controlled organisations has accurately identified the number of people that are ultimately employed, either by contract or consultancy.

An Auckland citizen looking to see how their ratepayer dollar is expensed appears to be purposely misinformed.

I repeat the tragic number of $1.049 billion that we need disclosure on via the 6 council-controlled organisations that we don't know who, where or what the money has been spent on. Now you start to understand why the late Penny Bright was so relentless on the council to open its books.

I have only looked at the 6 CCOs and have yet to count the true cost of the extra 7200 people employed under the umbrella of the parent Auckland Council.

Every 3 years, we think as citizens we might be able to have a say by electing local boards and a governing group of councillors overseeing all of this massive employment and expenditure.

As a member of the Finance and Expenditure Committee of Auckland City, from 2011-2016, I have witnessed documents placed before the governing board that are full of filtered and poor advice.

But at no times was that advice contested because the unelected CCO boards and their chief executives that run these billion-dollar-organisations always seem to ensure their non-contested recommendations are approved.

So while you are reading this article, as you are sitting in a traffic jam on the Northern, Southern or North Western Motorway or the Harbour Bridge, at least give thanks to the wonderful people who run this wonderful city who have given you plenty of time to build up your yoga and meditation skills while you are in the car waiting...waiting.

Salary of Auckland Mayor and 6 council-controlled organisation chief executives

Mayor Phil Goff: $280k
Auckland Tourism, Events & Economic Development (ATEED) CEO Nick Hill: $419k
Auckland Regional Facilities (ARF) CEO Chris Brookes: $479k
Panuku CEO Roger MacDonald: $569k
Auckland Transport (AT) CEO Shane Ellison: $579k
Watercare CEO Raveen Jaduram: $680k
Ports of Auckland CEO Tony Gibson: $750k
Source: 2018 annual reports