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Home / New Zealand

Brian Rudman: Council can't let AT take it for a ride

Brian Rudman
By Brian Rudman
Columnist·NZ Herald·
6 Feb, 2015 12:53 AM4 mins to read

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Illustration / Peter Bromhead

Illustration / Peter Bromhead

Brian Rudman
Opinion by Brian Rudman
Brian Rudman is a NZ Herald feature writer and columnist.
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This week Mayor Len Brown was caught asleep at the wheel. Neither he nor his retainers were aware, until alerted by the media, that a resolution was about to go before councillors to remove the two politicians from the Auckland Transport (AT) board of directors.

Getting two politicians on to the AT board was one of Auckland local politicians' major victories over central government in 2010 when the Super City was being set up.

The arm's-length, council-controlled organisation (CCO) model that was imposed is the local body variant of central government's state-owned enterprises, designed to remove "interfering" politicians from the day-to-day operations of publicly owned businesses, and put them under the governance of independent boards.

After a campaign by Auckland politicians, the Government reluctantly conceded that because AT would account for more than 50 per cent of the new Super City's expenditure, two councillors could join the governing board of the council's transport arm.

Despite this hard-fought battle, this week, a proposal to throw away this prize somehow slipped on to the agenda of Auckland Council's CCO governance and monitoring committee, chaired by Mr Brown's deputy, Penny Hulse.

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The recommendation emerged as part of an ongoing review of the governance of the CCOs. Mr Brown, who strongly opposed the CCO model in the set-up stages of the Super City, was quick to express his displeasure to Herald reporter Bernard Orsman when he learned of the proposal.

He said he wanted elected councillors to remain on the AT board to ensure elected oversight of Auckland's "most important" issue and said it was important constitutionally for the structure of the Super City to be politically led.

One of the two councillor-directors, Mike Lee, was similarly annoyed, pointing out to "directors and senior management that there were people called ratepayers who pay most of the bills". The next day, the controversial resolution conveniently fell off the bottom of the agenda and was rescheduled for next month's meeting.

Ms Hulse refused to discuss the issue publicly, but her attitude seems to be that officers can put up recommendations but it is still the politicians who have the final say whether to agree or not. Which is true enough, but equally, it's hard to imagine many political leaders giving their bureaucrats the freedom to write recommendations, and put to the vote, proposals they strongly oppose. Particularly a recommendation that removes hard-won political power.

The report recommending the removal of politician-directors from AT argued that "best practice would be not to have elected members on CCO boards due to the inherent conflict of interest".

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It's an argument I find hard to fathom. It's implying that the politicians, elected by Aucklanders to run the city, are somehow natural enemies of the "independent" directors appointed to run the city's parks, public transport services, water services and other public amenities. If anything, the councillors should be looking at ways of exerting greater "political guidance" over organisations like AT.

The last-minute addition of two politician-directors on the AT board back in 2010 left some issues unresolved which do need tidying up. The key problem is when are the politicians - at present Mike Lee and Christine Fletcher - politicians, when are they directors, and when, if ever, can they be both?

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They face a problem the bureaucrats in council and AT don't. From all accounts, from chief executive level down, there's an endless flow of information and debate between council and AT, which is as it should be, but at the political level it's different.

As board members, the politicians are bound by the confidentiality obligations of the boardroom. In the case of AT, this is comprehensive. AT is one of the most secretive "public" bodies ever. Just check out their agendas. This means the two politician-directors have great difficulty reporting back to their councillor colleagues.

Similarly, the councillor-directors are not delegates to AT, acting under the instructions of their colleagues. Individual councillors can pass on their concerns or ideas and hope that Mr Lee or Mrs Fletcher pass these on, but officially, they're like every other director, expected to be acting according to their own consciences. That's the sort of "best practice" issue that needs addressing, rather than dumping the two politicians from the AT board.

If I had a say, if there's to be any tinkering with the AT board, it would be to require at least two members are regular public transport users.

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