Water problem left until after election

Murray Douglas

A perceived conflict of interest around the Ruataniwha Catchment proposal will remain unresolved until the new Hawke's Bay Regional Council is elected in October.

Regional councillors yesterday voted to kick the issue into touch and leave the problem up to the new council to sort out, when it was elected in six weeks.

The council was told there was no "legal" conflict of interest by having three councillors on the board of its investment company, which was leading the catchment proposal including the development of the water storage dam. The issue was more around "perception" of conflict of interest or "predetermination" of decisions to be made around the project.

Councillor Murray Douglas argued against the decision to leave the issue up to the next council.

He said reports by the Auditor General stated councillors should not be on "operating companies" but could be on holding companies.

The council's investment company was in a phase where it was working as an operating company because it was developing the Ruataniwha project.

"If the project is completed, and begins operating as a separate business like the Napier Port for example, then the investment company can move on to be a holding company.

"At the moment it is not a holding company because it is knee-deep in developing the project and the Auditor-General's report says councillors shouldn't be involved in commercial entities."

Cr Douglas recommended the soon-to-be elected council reduce the number of councillors on the investment company from three to one, but the idea did not generate support from the other councillors.

Councillor Neil Kirton said ratepayers needed public representation on the investment company.

"The other independent directors on the investment company are not elected representatives of the public. It would be irresponsible of us to hand over the decision making for the construction and development of the dam, and its assessment of benefits, to a group of people unelected for that purpose."

Councillors also went on to make a decision on the remuneration level for the three independent directors.

It was proposed the base fees for a director be increased from $15,000 per year to $35,000 and the base fee for the chairman rise from $21,500 per year to $63,000.

Councillor Liz Remmerswaal proposed a "middle ground" where the base fee would be $30,000 and the chairman's fee $54,000.

Councillor Christine Scott noted a report which shows the directors' hours of work was "at the upper end" of the spectrum and the fees should reflect the workload.

The matter was put to the vote and a majority supported Cr Remmerswaal's recommendation.