Moving economic development agency Whanganui & Partners in-house to Whanganui District Council went against the recommendation of a report commissioned by the council itself.
The report, undertaken by Bayly
Independent report said Whanganui & Partners should remain a CCO
Whanganui & Partners staff will be retained under the new council model.
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She was “astounded” by the council’s lack of consultation and engagement while undertaking the CCO review process.
The board received a letter of expectation from council on December 18.
“We were alarmed that the budget was severely cut - by about 53 per cent. That was our first indication that at an official level, something was going on that we couldn’t see or be a part of,” Deighton said.
The board sent an urgent response on December 22 but didn’t get a reply from the council until late January.
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“[Because we are] part of the council family and understand the cost constraints on all councils across New Zealand, we thought the council would talk to us about what projects could be limited or maybe even cut out completely - whatever would be the most appropriate.
“That never happened. In fact, we think we‘ve received significant hamperng of our activities.
“We kept asking, ‘Can we join the [council] workshop?’, and, ‘Can we offer a new budget?’”
Council chief executive David Langford said the Bayly Lazarescu report was only part of the CCO review and other work had to be undertaken before it was complete and could be shared with the Whanganui & Partners board.
District councillors were presented with a report from Langford on February 21 - before the final vote took place.
It said the Bayly Lazarescu report made its findings and recommendations based on “perceptions and information provided during the interviews with key stakeholders during the early stages of the CCO review”.
“As such, they are not all informed by data or other tangible evidence.
“In completing the full scope of the CCO Review, council officers have undertaken further analysis and sought to provide an evidence-based assessment.”
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His report said once extreme outlying data points were removed, there didn’t appear to be any observable difference in economic performance when a CCO was used compared to any other delivery model.
If the delivery model was not a critical determinant of success, the most cost-effective delivery model must be considered, it said.
Langford said now the council had made its decision, his focus was on achieving a smooth transition for Whanganui & Partners and looking after the staff so they could “continue the excellent work they do supporting our economy and local businesses”.
His report identified $118,000 per year in initial savings from bringing the agency in-house, along with a further $334,000 in potential savings.
It said the savings proposed by the agency - $323,000 - could still be delivered if it was brought in-house.
Deighton said Whanganui & Partners met with the council at a workshop on February 15 and presented three cost-saving scenarios.
One was the status quo, one could have saved $323,000, and the most extreme - “cutting projects out” - could have saved between $500,000 and $600,000, she said.
“If the issue was about budgets, we could have worked together to arrive at a platform where they could work from and we could work from.”
Former Whanganui mayor Annette Main, who was in office when the agency began, said she believed the agency could still work well within the council but connections needed to be maintained.
There needed to be some sort of external advisery board - “somebody to give background information and knowledge about Whanganui” - in place.
“There are no better people to do that than some of those bigger businesses in town,” Main said.
“I wouldn’t like to see a lot of the good work that’s been done just stop.
“Major stuff is going on. The Sarjeant Gallery is reopening and work needs to be done on a strategy to make sure those who have funded it, including ratepayers, actually receive back what they expected.”
Twenty-five stakeholders were interviewed for the Bayly Lazarescu report, including the 12 district councillors, Whanganui Mayor Andrew Tripe, then-Whanganui & Partner board chairman Pahia Turia and the agency’s chief executive Jonathan Sykes.
Three independent business figures were interviewed - Business Whanganui chief executive Helen Garner, Whanganui Vintage Weekend trustee Keith Smith and Te Mana Atatū chairman Hayden Potaka.
Deighton said she questioned why more members of the business community weren’t consulted as part of the process, as they were the ones who would be affected most by the decision.
Garner said the in-house move was a council decision to help keep rates as low as possible.
“Every business owner knows that sometimes you need to make difficult decisions to keep the doors open.
“We see this decision as one that enables economic development activity to continue in our region, which is particularly important during these lean times, ensuring we have a strong base for when times improve, which they inevitably will.”
Former Whanganui & Partners board chairman Myles Fothergill said he had just returned to Whanganui after three weeks abroad, so hadn’t made inquiries about the decision.
He said his initial reaction was disappointment.
“Others took over from me, but it’s something I’m really proud of.
“Credit to [former mayor] Hamish McDouall and [former council chief executive] Kym Fell for having the foresight to make it independent, which led to the appointment of a really strong board.
“We built an excellent team and made it work. I handed it over in excellent shape and Pahia [Turia] took it to the next level, then Gaelle followed after him.”
The agency had the trust of the business community, and he was concerned “after a decade of building this thing”, that trust could be diminished, he said.
Deighton said the agency had been a high-achieving CCO with a motivated board, chief executive and team, and its autonomy had been its strength.
“This has benefitted the whole district and the council itself.
“The staff is our priority and we remain committed to the best outcome for them, but uncertainty still remains post-July 1.”
Mike Tweed is an assistant news director and multi-media journalist at the Whanganui Chronicle. Since starting in March 2020, he has dabbled in everything from sport to music. At present, his focus is local government, primarily Whanganui District Council.
