Auckland Mayor Wayne Brown at the second day of the annual budget debate at the Town Hall. Photo / Michael Craig
Auckland Mayor Wayne Brown at the second day of the annual budget debate at the Town Hall. Photo / Michael Craig
Auckland Council has spent $7.4 million on recruiting staff during a supposed hiring freeze over the last year - with Mayor Wayne Brown labelling it unacceptable expenditure he is “determined to radically reduce” in upcoming budgets.
The total Auckland Council recruitment spend from November, 2022, to October, 2023, was obtainedby the Herald under the Local Government Official Information and Meetings Act.
The Auckland Mayor’s office indicated this $7.4m recruitment spend over a 12-month period across Auckland Council and its Council Controlled Organisations (CCOs) occurred during a hiring freeze for much of it.
“This is not an acceptable expenditure. This is the very reason I’m calling out unnecessary spending at Auckland Council,” Brown said.
“This is the sort of wasteful expenditure that I am determined to radically reduce to the bare minimum.
“This is in line with my 10-year Budget proposal to have sensible initiatives to rein in spending with outside firms and combine back-office services for all CCOs, such as IT, property management, and HR.”
It’s understood Brown is particularly unhappy about the fact many of these internal recruitment costs were to hire people who were already working within Auckland Council and simply reassign them for new roles within the organisation.
This was the case for the role which drew the highest recruitment spend over the 12-month period - replacing outgoing Auckland Council chief executive Jim Stabback who resigned halfway through a five-year term.
Auckland Mayor Wayne Brown, left, wants chief executive Jim Stabback, right to come up with another $5m of savings in his latest budget proposal. Photo / Jason Oxenham
Council engaged a contract for $110,000 with executive recruitment agency Sheffield NZ after Stabback finished up in the top council role in June.
Then director governance and CCO Partnerships, Phil Wilson, was appointed acting chief executive on July 2.
Following the Sheffield NZ recruitment effort, Wilson was confirmed as the new council chief executive on November 6 on a salary of $600,000.
Prior to Wilson’s appointment, council’s director of group services, Richard Jarrett, defended the recruitment contract on the breadth of the global search for a role of such importance and responsibility.
“The contract value as stated reflects the cost of an international executive search for a complex and high-profile appointment,” Jarrett said.
“The contract value includes a fixed fee which provides the council with certainty of cost, but also allows for disbursements and contingency, so therefore represents the potential cost envelope rather than all costs paid.”
Wilson has worked at Auckland Council since 2010.
Brown’s frustration with the substantial recruitment spend comes after a year in which he and the Auckland Council governing body had to make desperate cuts to fill a $375m budget hole.
Part of this was filled by the selling a 7 per cent holding in Auckland Airport shares, netting $835.9m.
Wilson took over as acting Chief Executive on July 2 and will take over as chief executive on Monday, November 6.
But another major component of the mayor’s cost-cutting annual budget was 500 job losses at Auckland Council and its agencies that was announced in May.
The scale of Auckland Council and CCOs’ recruitment teams will also be part of this dramatic reduction in back-office services.
The cost of Auckland Council’s internal talent acquisition team, including staff and administrative costs, was $3,976,099.
This number includes both CCOs Auckland Unlimited, which deals with facilities and tourism, and Eke Panuku Development, which oversees council’s property holdings.
Auckland Council’s external recruitment spend for that same 12-month period was $1,756,100. These costs are fees only and did not include the salary of the recruited staff member.
CCO Auckland Transport spent $916,431 on both internal and external recruitment costs in this same period.
Watercare spent $580,986 on its internal recruitment team, including staff salaries, and $158,127 on external recruitment agencies.
Chris Darby. Photo / Dean Purcell
However, Auckland Councillor Chris Darby did provide some context around the need for council to do due diligence before hiring people.
“Recruitment is not just putting an ad out there and attracting somebody. I can tell you that Auckland Council has been caught out in the past, not undertaking the proper I guess the due diligence or reference checks, looking at a person’s history.
“People put things in CVs and you’ve got to double check that, otherwise you’re at risk of putting a person amongst other Auckland Council employees and they might have a checkered history in a particular area.”
Darby was nevertheless complimentary of Mayor Brown’s efforts to reduce bureaucratic waste within council.
“He is really bringing the blowtorch to this sort of expenditure. He’s not backing off and it is actually bringing the right results,” he said.
“It’s good outcomes and it’s not necessarily just reducing the levels of service, it’s actually just greater productivity, getting better value.”
Tom Dillane is an Auckland-based journalist covering local government and crime as well as sports investigations. He joined the Herald in 2018 and is deputy head of news.
