An artist's impression of Auckland Light Rail. Photo / Supplied
A newly-appointed board director for Auckland’s light rail project has forced the organisation to create a “Probity Management Plan” to manage any real or perceived conflicts of interest that might arise from his position.
The board member, Chris Aiken, will also have his role as an “active member” of the board delayed until it decides on the recommended route and station locations of the light rail line.
Aiken serves as a director of Kiwi Property, a large property investor, as well as on Kāinga Ora’s Construction Programme Advisory Panel - interests he declared as part of the Government’s process of vetting potential conflict of interests for appointments. He is the former chief executive of Hobsonville Land Company.
But National’s transport spokesman Simeon Brown is a sceptic of the plan, and noted that advice from officials, accidentally released by Wood’s office, said they believed it would be “very difficult” for Aiken to take up the role at Auckland Light Rail unless he first resigned from Kiwi Property.
The problem is that the light rail line is intended, in part, to open up large swathes of Auckland for development and intensification - projects which might be of interest to Kiwi Property.
Transport Minister Michael Wood, who appointed Aiken, told the Herald that a “thorough vetting practice is carried out to identify any perceived or actual conflict of interest prior to Board appointments”.
Wood said Aiken “declared interests prior to his appointment to the ALR [Auckland Light Rail] Ltd board”.
“As part of its on-going transparency protocols ALR Ltd has established a Probity Management Plan for Mr Aitken after noting Kiwi Property had material assets in Auckland that could, in future, be in the vicinity of ALR’s proposed route from Wynyard Quarter to Auckland Airport,” Wood said.
Wood said that Crown had been advised by Kiwi Property that it “had no interests in, or potential interest, in properties currently publicly identified as being in the ALR corridor”.
“The urban development knowledge and focus Chris brings continues to be a huge and valuable asset for the project,” Wood said.
“To further reduce any perception risk, Mr Aiken’s role as an active member of the Board has been delayed until after the Board makes a decision on the recommended route and station locations,” Wood said.
A Kiwi Property spokesman told the Herald it was committed to “the highest standards of corporate governance and have a comprehensive conflict of interest policy in place”.
“Chris’ appointment to the board of Auckland Light Rail does not contravene this policy. It’s worth noting that we don’t own any assets within the Auckland Light Rail Corridor.
“If we chose to look at opportunities in or around the corridor in the years ahead, Chris would be excluded from any discussions, information and decisions relating to the matter,” the spokesman said.
Aiken chose not to add comment beyond what the Kiwi Property spokesman said.
Wood said Aiken had confirmed to the Government that “additional measures relating to Kiwi Property’s own conflict of interest policy will be taken if a perceived, potential or actual conflict of interest arises: he will not receive any information related to the conflict of interest, he will not be involved in any discussions or decisions associated with that potential conflict; he will be removed from any other related or associated dealings relating to the potential conflict”.
Brown said in his view it was likely this plan would not be enough, and that Aiken should not have been appointed in the first place.
Brown pointed to advice from officials which said that this plan might not be enough. That advice was part of an Official Information Act request by the National Party - the Government had highlighted this section for redaction, but actually sent the paper, unredacted, to the National Party. Another copy of the documents, this time with full redactions, notes this particular section was withheld to “maintain the constitutional convention protecting the confidentiality of advice tendered by Ministers and officials”.
“Officials have advised that they consider that it would be very difficult for Mr Aiken to be appointed unless he resigns from the Kiwi Property Board. A written understanding is likely to be difficult to manage,” the paper said.
Brown said he considered Wood “must urgently address why he went against official advice not to appoint Mr Aitken, and how he will address concerns so that Aucklanders can be certain that Auckland Light Rail is not at risk of any external interference in its governance”.
The paper detailed the potential problems with Aiken’s appointment.
It noted that while Kiwi Property did not currently have investments along the light rail route, the company’s “intended future investments are similar to what is envisaged through the ALR Project”.
“As such, there is a possibility that there would likely be commercial interest from Kiwi Property to invest along the route in the future creating conflicts of interest,” the paper said.
The paper proposed a management plan which “requires that Kiwi Property undertakes not to invest in or arrange to invest in any property along the ALR corridor until further decisions are made on the proposed route”.
The papers noted that the Chair of Auckland Light Rail considered the “conflict of interest is manageable” with the management strategy “provided that the written undertaking sufficiently constrains Kiwi Property until applications for consent are lodged in mid-2023″.
The Herald put questions to Auckland Light Rail and Kiwi Property on Aiken’s behalf.