A London Transport guru is believed to have turned down the top transport job in the Auckland Super City amid reports of senior council staff fleeing the new set-up because of poor pay and conditions.

With three months until the Super City comes into being, the agency setting it up has been unable to find an interim chief executive for Auckland Transport, a council-controlled organisation which will be responsible for spending about $680 million of Auckland ratepayers' money.

Sources said that after long, drawn-out negotiations the preferred candidate from London Transport backed out about 10 days ago. An applicant from Perth is also believed to have been on the short-list, but withdrew.

Last night, the agency did not deny the reports that one, possibly two, candidates had turned down the job.

"Transport is a major strategic issue for Auckland and this is a significant role. It's important to get the right candidate and the process is ongoing," a spokesman said.

Four months ago, corporate business leader Doug McKay was appointed interim chief executive of the Auckland Council on a salary of $675,000 a year with an incentive bonus of $76,500. He starts work on Monday.

Reports are emerging of senior staff being offered roles in the Super City for 20 per cent to 30 per cent less than their present salaries and with cuts in conditions.

This has prompted several experienced staff to take jobs elsewhere in New Zealand or better-paying jobs in Australia, leading to jobs being offered to second-, third- and fourth-choice candidates.

Waitakere Deputy Mayor Penny Hulse said she was aware of senior staff being offered new roles in the Super City on salaries up to $40,000 less than those being paid for theirpresent jobs.

"There is only one game in town when it comes to local government ... and they are being held over a barrel and told to take it or leave it."

She said the conditions being offered, such as only five days' sick leave and no long-service leave, "were bordering on the inhumane".

"We are pinning huge hope on getting Auckland up to a world-class region," she said.

"We need the best and brightest staff to make this happen."

One council officer said most positions being offered to existing communications and information technology staff were "very junior and on a pay scale below what people are currently on".

A report to Auckland City's audit and risk committee from the council's risk and assurance group manager, Glennis Christie, said there was "uncertainty and anxiety" throughout the organisation.

"There is a considerable way to go in the transition and recruitment process before staff transitioning to the Auckland Council, Auckland Transport or other CCOs are confirmed and not long to go to November 1 [when the Super City comes into being]," she said.

About 3500 staff are going through the "change process", but the number of available jobs is still unknown.

Former trade union leader and Alliance MP Laila Harre, who is heading employment matters for the agency, has said existing staff would not receive less pay for doing the same or a substantially similar job.

She said if council staff chose to accept a "substantially different job" on less pay, Super City legislation provided for six months' salary protection at their current pay, or longer if that was provided in their employment agreement.

Asked if the pay differences would eventually be set at one level, she said that would be a matter for staff and the Auckland Council management to resolve.

Public Service Association general secretary Richard Wagstaff, whose union represents about 2700 workers employed by Auckland's eight councils, said it had negotiated a "positive" collective agreement with the agency to put to workers next week for ratification. Most workers would be on equal or better terms than at present.

The senior management teams at the Auckland Council and Auckland Transport, comprising a chief financial, operating and planning/infrastructure officer, have been appointed by the agency.

It has made a further 35 third-tier managerial appointments.