Editorial: Accountability failure at heart of city power crisis

Damage caused by the fire at the Penrose substation. Photo / Jason Oxenham

Opinion

When the lights go out over a large part of a city the size of Auckland, questions must be asked. How did this happen? Who allowed it to happen? Whose head must roll?

The certainty that these questions will be asked is the one thing that can usually ensure these things do not happen. An inquiry promised by the Minister of Energy should not be limited to how the fire occurred at the Penrose substation and why sprinklers were not installed over the cables that caught fire, or who was at fault.

Inquiries are inclined to explain how a mishap occurred and suggest a way to ensure the same thing does not happen again. They are less inclined to pinpoint blame to individuals, and invariably decide a "system" was at fault.

By that they mean a deficiency in a management procedure, and they will make a long list of specific recommendations for additional procedures. The electricity line company will undertake to carry them out to the letter, and it will. It will have fixed that problem, but not the next one.

The most reliable way to ensure essential public services do not fail is to set up a system in which everyone is accountable for the decisions they are entrusted to make. Everyone should work with those questions in the back of their mind. How did this happen? Who allowed it to happen? Whose head must roll? It may sound cruel but it works. It tends to ensure the right thing is done and "accidents" are avoided.

Accountability has to be cruel if it is to be more than management jargon and it has to apply at all levels of an organisation. The chief executive must be vulnerable to being fired by its board, the board should be vulnerable to those who elect it, who need to be capable of holding the board to account.

In the private sector this is reasonably easy. Boards are elected by their controlling shareholders, who have a compelling financial interest in the organisation's performance.

Electricity lines companies such as Transpower, whose national grid includes the Penrose substation, and local network operators such as Auckland's Vector, are harder to hold accountable. They have no competitors, lines are natural monopolies. They tend to remain in the public sector where the demand for accountability from the top has to come from nominal "shareholders" who can be fired by the public at elections if the service is not satisfactory.

Transpower's board is appointed by the Government, and at that level electoral accountability works fairly well. The Prime Minister was quick to promise an inquiry on Monday and he will mortally fear too many black-outs of the scale Auckland suffered on Sunday. Vector's board is appointed by an elected body called the Auckland Energy Consumer Trust and it has been much slower to act.

Yesterday we reported that its chairman, William Cairns, was still waiting for a briefing from his chief executive, Simon Mackenzie. Mr Cairns said he "hoped" to hear from Mr Mackenzie yesterday and, after our report, doubtless he did. But he should not have been "hoping" on Monday; he should have been active on Sunday, demanding to know what was happening on behalf of the consumers he represents.

If Vector is found to be at fault those heads can roll, but that might not solve the problem. Vector's accountability to an elected consumer trust is not working. The elections attract hardly any interest. Turnouts are very low. It would be hard to find an Aucklander who had heard of Mr Cairns or could name a trust member. A better source of discipline in the performance of local lines companies has to be found.