Agenda of Finance and Performance Committee

Terms of Reference

Responsibilities

The purpose of the committee is to:

a) advise and support the mayor on the development of the Long-term Plan (LTP) and Annual Plan (AP)

b) monitor the overall financial management and performance of the council parent organisation and Auckland Council group

c) make financial decisions required outside of the annual budgeting processes.

The committee will establish an annual work programme outlining key focus areas in line with its key responsibilities, which include:

· advising and supporting the mayor on the development of the LTP and AP for consideration by the Governing Body including:

o local board agreements

o financial policy related to the LTP and AP

o setting of rates

o preparation of the consultation documentation and supporting information, and the consultation process, for the LTP and AP

· monitoring the operational and capital expenditure of the council parent organisation and Auckland Council Group, and inquiring into any material discrepancies from planned expenditure

· approving the financial policy of the council parent organisation

· establishing and managing a structured approach to the approval of non-budgeted expenditure (including grants, loans or guarantees) that reinforces value for money and an expectation of tight expenditure control

· approve the council insurance strategy and annual insurance placement for Council

· performance measures and monitoring

· write-offs

· acquisition of property in accordance with the LTP

· disposals in accordance with the LTP

· recommending the Annual Report to the Governing Body

· funding for achieving improved outcomes for Māori.

Powers

(i) All powers necessary to perform the committee’s responsibilities, including:

(a) approval of a submission to an external body

(b) establishment of working parties or steering groups.

(ii) The committee has the powers to perform the responsibilities of another committee, where it is necessary to make a decision prior to the next meeting of that other committee.

(iii) If a decision is a budgetary or financial decision that relates primarily to the Finance and Performance Committee responsibilities, the Finance and Performance Committee has the powers to make associated decisions on matters that would otherwise be decided by other committees. For the avoidance of doubt, this means that matters do not need to be taken to multiple committees for decisions.

(iii) The committee does not have:

(a) the power to establish subcommittees

(b) powers that the Governing Body cannot delegate or has retained to itself (section 2)

Exclusion of the public – who needs to leave the meeting

Members of the public

All members of the public must leave the meeting when the public are excluded unless a resolution is passed permitting a person to remain because their knowledge will assist the meeting.

Those who are not members of the public

General principles

· Access to confidential information is managed on a “need to know” basis where access to the information is required in order for a person to perform their role.

· Those who are not members of the meeting (see list below) must leave unless it is necessary for them to remain and hear the debate in order to perform their role.

· Those who need to be present for one confidential item can remain only for that item and must leave the room for any other confidential items.

· In any case of doubt, the ruling of the chairperson is final.

Members of the meeting

· The members of the meeting remain (all Governing Body members if the meeting is a Governing Body meeting; all members of the committee if the meeting is a committee meeting).

· However, standing orders require that a councillor who has a pecuniary conflict of interest leave the room.

· All councillors have the right to attend any meeting of a committee and councillors who are not members of a committee may remain, subject to any limitations in standing orders.

Independent Māori Statutory Board

· Members of the Independent Māori Statutory Board who are appointed members of the committee remain.

· Independent Māori Statutory Board members and staff remain if this is necessary in order for them to perform their role.

Staff

· All staff supporting the meeting (administrative, senior management) remain.

· Other staff who need to because of their role may remain.

Local Board members

· Local Board members who need to hear the matter being discussed in order to perform their role may remain. This will usually be if the matter affects, or is relevant to, a particular Local Board area.

Council Controlled Organisations

· Representatives of a Council Controlled Organisation can remain only if required to for discussion of a matter relevant to the Council Controlled Organisation.

1 Apologies

At the close of the agenda no apologies had been received.

2 Declaration of Interest

Members are reminded of the need to be vigilant to stand aside from decision making when a conflict arises between their role as a member and any private or other external interest they might have.

3 Confirmation of Minutes

That the Finance and Performance Committee:

a) confirm the ordinary minutes of its meeting, held on Thursday, 20 May 2021, including the confidential section; and the extraordinary minutes of its meeting, held on Tuesday, 25 May 2021 as a true and correct record.

4 Petitions

At the close of the agenda no requests to present petitions had been received.

5 Public Input

Standing Order 7.7 provides for Public Input. Applications to speak must be made to the Governance Advisor, in writing, no later than one (1) clear working day prior to the meeting and must include the subject matter. The meeting Chairperson has the discretion to decline any application that does not meet the requirements of Standing Orders. A maximum of thirty (30) minutes is allocated to the period for public input with five (5) minutes speaking time for each speaker.

At the close of the agenda no requests for public input had been received.

6 Local Board Input

Standing Order 6.2 provides for Local Board Input. The Chairperson (or nominee of that Chairperson) is entitled to speak for up to five (5) minutes during this time. The Chairperson of the Local Board (or nominee of that Chairperson) shall wherever practical, give one (1) day’s notice of their wish to speak. The meeting Chairperson has the discretion to decline any application that does not meet the requirements of Standing Orders.

This right is in addition to the right under Standing Order 6.1 to speak to matters on the agenda.

7 Extraordinary Business

Section 46A(7) of the Local Government Official Information and Meetings Act 1987 (as amended) states:

“An item that is not on the agenda for a meeting may be dealt with at that meeting if-

(a) The local authority by resolution so decides; and

(b) The presiding member explains at the meeting, at a time when it is open to the public,-

(i) The reason why the item is not on the agenda; and

(ii) The reason why the discussion of the item cannot be delayed until a subsequent meeting.”

Section 46A(7A) of the Local Government Official Information and Meetings Act 1987 (as amended) states:

“Where an item is not on the agenda for a meeting,-

(a) That item may be discussed at that meeting if-

(i) That item is a minor matter relating to the general business of the local authority; and

(ii) the presiding member explains at the beginning of the meeting, at a time when it is open to the public, that the item will be discussed at the meeting; but

(b) no resolution, decision or recommendation may be made in respect of that item except to refer that item to a subsequent meeting of the local authority for further discussion.”

Finance and Performance Committee

17 June 2021

24 Upper Municipal Place, Onehunga disposal recommendation

File No.: CP2021/04982

Te take mō te pūrongo

Purpose of the report

1. To obtain approval for the sale of 24 Upper Municipal Place, Onehunga a property located within the boundaries of Transform Onehunga for urban renewal purposes.

Whakarāpopototanga matua

Executive summary

2. 24 Upper Municipal Place, Onehunga is a 263m² commercial building no longer required by council for water infrastructure purposes. It was held by council for a public work when Transform Onehunga was approved by council in 2017; as such it was not considered within the scope of Transform Onehunga.

3. The adjoining landowner (and current lease holder of 24 Upper Municipal Place) is seeking to acquire the property for urban renewal purposes as part of its development of the former Onehunga Working Men’s Club site.

4. The sale of this property for urban renewal purposes will contribute towards the key strategic moves identified for Transform Onehunga in the High Level Project Plan (HLPP), namely by encouraging smart growth and quality connected communities. As the property is within the Transform Onehunga boundaries, sales proceeds from a disposal will be allocated to the Eke Panuku Transform/Unlock budget and contribute towards projects with public good outcomes for Transform Onehunga.

5. Consultation with council and it’s council-controlled organisations (CCOs), iwi authorities and the Maungakiekie-Tāmaki Local Board has now taken place. Feedback received from the council group is supportive of the proposed disposal.

6. Subject to Finance and Performance Committee approval and the completion of due diligence and other statutory processes, Eke Panuku will enter exclusive negotiations with the adjacent landowner to dispose of 24 Upper Municipal Place to the adjoining owner for urban renewal purposes.

Ngā tūtohunga

Recommendation/s

That the Finance and Performance Committee:

a) approve, subject to the satisfactory conclusion of any required statutory processes the disposal for urban renewal purposes of 24 Upper Municipal Place, Onehunga comprised of an estate in fee simple more or less being Part Lot 5 Deposited Plan 42993 contained in computer freehold register 96173;

b) note that sales proceeds will be allocated to the Eke Panuku Transform/Unlock budget and contribute towards projects with public good outcomes for Transform Onehunga; and

c) agree that final terms and conditions be approved under the appropriate delegations.

Horopaki

Context

7. The Transform Onehunga HLPP was adopted by the Planning Committee on 28 March 2017 (PLA/2017/34). Key strategic moves identified in the Transform Onehunga HLPP include encouraging smart growth and quality connected communities.

8. Transform Onehunga will catalyse and reinvigorate wider private development potential in Onehunga through proposed mixed-use developments on specific council landholdings within the Transform Onehunga boundary. This includes Eke Panuku using council landholdings, partnership opportunities and a demand-led market to spur development in the Onehunga Town Centre.

9. For all properties that are identified as candidates for sale or development, Eke Panuku engages with council departments and it’s CCOs regarding the proposed disposal. Eke Panuku then consults with local boards, mana whenua and ward councillors.

10. The Finance and Performance Committee makes the final decision to approve a property for disposal.

Tātaritanga me ngā tohutohu

Analysis and advice

Property information

11. 24 Upper Municipal Place is a 263m² commercial building. The original property was acquired by the former Borough of Onehunga in 1947 for the purposes of a well.

12. At the establishment of Auckland Council in 2010, the parcel containing the well, known as 26 Upper Municipal Place was transferred to Watercare Services Limited. 24 Upper Municipal Place continued to be held by Auckland Council for the purposes of water supply infrastructure purposes and was not considered within the scope of Transform Onehunga when it was approved in 2017 as it was held for a council service use.

13. The Auckland Unitary Plan zoning is Business Town Centre. The entirety of the property has a council rating valuation of $500,000. Due to the nature of the acquisition, 24 Upper Municipal Place is subject to the Public Works Act 1981.

14. The proposed disposal of this property is not deemed to be significant under Auckland Council’s Significance and Engagement Policy.

Development opportunity

15. Following Watercare’s disposal of 26 Upper Municipal Place, Eke Panuku has identified 24 Upper Municipal Place as suitable for disposal for urban renewal purposes. One of the key strategic moves set out in the Transform Onehunga HLPP is “encouraging smart growth and quality connected communities”. To enable this, Eke Panuku will partner with other government agencies and the private sector to deliver strategically located, quality housing.

16. The adjoining landowner (and current lease holder of 24 Upper Municipal Place) is seeking to acquire the property to enable it to be included in its proposed mixed-use development of the adjacent former Onehunga Working Men’s Club site. The proposed redevelopment will include 102 apartments, 81 car parks and approximately 341m² of retail space. The proposed sale of 24 Upper Municipal Place for urban renewal purposes to the adjoining landowner will contribute towards enabling smart growth, quality connected communities and the delivery of quality housing and retail space in Onehunga, as envisaged in the Transform Onehunga HLPP.

Tauākī whakaaweawe āhuarangi

Climate impact statement

17. The proposed sale of this property to the adjoining landowner for urban renewal purposes and its inclusion as part of its proposed development of the adjoining property will lead to land use changes. It is acknowledged that any form of construction and development can increase carbon emissions.

18. Emissions associated with any potential redevelopment can be reduced through development standards agreed through a future development agreement, application of Panuku’s Homestar 6 policy and requirements to reduce carbon emissions in commercial developments.

19. The property is not located in a flood prone area and is not a coastal property likely to be impacted in the future by rising sea levels.

Ngā whakaaweawe me ngā tirohanga a te rōpū Kaunihera

Council group impacts and views

20. Eke Panuku consulted all relevant council departments and CCOs on the proposed disposal. No substantive feedback was received in response.

Ngā whakaaweawe ā-rohe me ngā tirohanga a te poari ā-rohe

Local impacts and local board views

21. At its 25 May 2021 meeting, the Maungakiekie-Tāmaki Local Board endorsed the recommendation to dispose of 24 Upper Municipal Place for urban renewal purposes, noting that sales proceeds will be allocated to the Eke Panuku Transform/Unlock budget and contribute towards projects with public good outcomes for Transform Onehunga.

Tauākī whakaaweawe Māori

Māori impact statement

22. Eke Panuku engagement with mana whenua through the Transform Onehunga mana whenua project working group has been ongoing since 2016.

23. 19 mana whenua iwi authorities were contacted for site-specific feedback on the proposed sale of part of 24 Upper Municipal Place for urban renewal purposes. This engagement sought to understand if there were any issues of cultural significance with the proposed disposal. Information regarding the size and configuration of the property, and the proposed development of the adjoining property was provided as part of the engagement undertaken.

24. Eke Panuku received a notification of cultural significance from Te Runanga o Ngāti Whātua. Eke Panuku has acknowledged the notification and confirmed its interests have been noted on the property file. Eke Panuku has further discussed with Te Runanga o Ngāti Whātua on how council can recognise the significance, including recording information council’s geospatial layers. No further confirmation has been received. In the event the property is approved for sale, all iwi entities will be alerted of the decision and council’s intention to sell to the current leaseholder and adjacent landowner.

Ngā ritenga ā-pūtea

Financial implications

25. As the subject property is within the Transform Onehunga boundaries, the sales proceeds will contribute towards projects with public good outcomes for Transform Onehunga if it is approved for disposal.

Ngā raru tūpono me ngā whakamaurutanga

Risks and mitigations

26. No risks associated with the recommendation contained in this report have been identified.

27. Key risks of the disposal not being approved are adverse urban design outcomes due to configuration of this property and surrounding land.

Ngā koringa ā-muri

Next steps

28. The adjacent landowner is seeking to purchase this property should it be approved for sale for urban renewal purposes. Subject to the Finance and Performance Committee approving the disposal and the completion of due diligence and other statutory processes, Eke Panuku will enter negotiations with the adjacent landowner. The terms and conditions of the proposed disposal will include confirmed development outcomes to be achieved and associated timeframes and will be approved under appropriate financial delegation.

Ngā tāpirihanga

Attachments

No.	Title	Page
a ⇩	Images of 24 Upper Municipal Place, Onehunga	15

Ngā kaihaina

Signatories

Authors

Anthony Lewis - Senior Advisor, Portfolio Review, Panuku Development Auckland

Richard Taylor - Priority Location Director, Panuku Development Auckland

Authorisers

Letitia Edwards - Head of Strategic Asset Optimisation (Acting)

Marian Webb – General Manager Assets and Delivery

Peter Gudsell - Group Chief Financial Officer

Finance and Performance Committee

17 June 2021

Emergency Budget 2020/2021 - Update June 2021

File No.: CP2021/07524

Te take mō te pūrongo

Purpose of the report

1. To provide updated financial information since the Emergency Budget 2020/2021 was adopted.

Whakarāpopototanga matua

Executive summary

2. The Emergency Budget 2020/2021 was adopted by the Governing Body on 30 July 2020.

3. The final budget included a projected reduction in cash operating revenue of around $450 million for 2020/2021 as a result of COVID-19 and a range of measures such as reductions in operating expenditure, temporarily elevated debt levels, capital expenditure deferrals, and asset recycling to mitigate the impact of this revenue shortfall as well as the unprecedented drought situation.

4. As the financial year progressed, positive revenue results from certain areas meant a lower revenue loss compared to Emergency Budget projections. These areas include:

· Regulatory revenue and consenting volumes higher than Emergency Budget assumptions

· Stronger Infrastructure Growth Charges and new connections revenue from Watercare.

5. Despite the more favourable revenue outlook, the committee resolved that it remains prudent to continue paying down debt for the remainder of the financial year to provide a buffer against future shocks given the high degree of uncertainty surrounding the longer-term revenue projections.

6. This month includes an update on progress for 2020/2021 against the Emergency Budget as at the end of May 2021.

Progress for 2020/2021 against the Emergency Budget

7. A verbal update on the group financial performance for May 2021, accompanied by a performance dashboard, will be provided at the meeting.

8. Auckland Council achieved the $120 million savings target at the end of April.

Ngā tūtohunga

Recommendation/s

That the Finance and Performance Committee:

a) receive the update on progress for financial year 2020/2021.

Horopaki

Context

9. The Emergency Budget 2020/2021 was adopted by the Governing Body on 30 July 2020.

10. The financial implications of COVID-19 were highly uncertain at the time the Emergency Budget was prepared. Therefore, the adopted budget was developed based on a set of forecasting assumptions for a “most likely scenario”. Key assumptions included government decisions on alert levels and the economic outlook.

11. The final budget included a projected reduction in cash operating revenue of around $450 million for 2020/2021 as a result of COVID-19 and a range of measures were implemented including reductions in discretionary expenditure, temporarily elevated debt levels, capital expenditure deferrals, temporary reductions in operating service levels and asset recycling to mitigate the impact of this revenue shortfall as well as the unprecedented drought situation.

Tātaritanga me ngā tohutohu

Analysis and advice

Progress for 2020/2021 against the Emergency Budget

Financial performance (May)

12. A verbal update on the group financial performance for May 2021, accompanied by a performance dashboard, will be provided at the meeting.

Savings progress for Auckland Council

13. The Emergency Budget included group savings and cost reductions of over $200 million compared to the group budget submitted in March 2019. The progress towards the savings target for Auckland Council of $120 million has been reported monthly. Progress of the CCOs towards their savings targets will be reported through the quarterly performance reporting to the CCO Oversight Committee.

14. Auckland Council achieved the $120 million savings target at the end of April.

Tauākī whakaaweawe āhuarangi

Climate impact statement

15. Updates on the financial progress for 2020/2021 provided in this report do not have any direct impact on climate change. However, close monitoring and providing visibility to this committee enables continued prudent financial management of the Auckland Council Group. Achieving efficiency savings and maximising financial benefits will assist in freeing up resources for applying to the council’s strategic priorities such as climate change.

16. There is no additional climate impact in relation to the updates in this report.

Ngā whakaaweawe me ngā tirohanga a te rōpū Kaunihera

Council group impacts and views

17. Progress against the Emergency Budget is closely monitored across the entire council group, based on performance information provided by the council and respective CCO finance teams.

Ngā whakaaweawe ā-rohe me ngā tirohanga a te poari ā-rohe

Local impacts and local board views

18. Local board views and preferences were taken into account during the Emergency Budget process. The monitoring of progress against the Emergency Budget includes local board budgets.

19. There is no specific impact on local communities from the updates provided in this report.

Tauākī whakaaweawe Māori

Māori impact statement

20. This budget update report is for information only and therefore does not have direct impact on Māori.

21. Auckland Council has obligations under Te Tiriti o Waitangi and the Significance and Engagement Policy to take special consideration when engaging with Māori to enable Māori participation in council decision making to promote Māori well-being. The Emergency Budget public consultation engagement programme included:

· Raising awareness of the opportunity to give feedback through the current Māori database

· Targeted Māori community engagement through partners, covering our high population areas and regionwide, supporting feedback through online and hard copy submission forms

· Live discussions and questions and answers with elected members and subject matter experts through Radio Waatea, with a focus on high population areas in the West and South and including the opportunity for audience and online feedback direct to decision-makers

· Māori-focused social media campaign.

22. Feedback was collated as part of the Emergency Budget process and presented by iwi to the Governing Body on 17 June 2020 and subsequently presented to councillors as part of the main feedback report for their consideration at the Finance and Performance Committee on 8 July 2020.

23. Future agenda items may have implications for Māori and the Emergency Budget identified relevant Maori outcomes which will be addressed in the respective reports.

Ngā ritenga ā-pūtea

Financial implications

24. Staff will continue to advise the committee on any resultant budget changes required to stay within the overall key financial parameters set for the Emergency Budget as the remainder of the financial year progresses.

Ngā raru tūpono me ngā whakamaurutanga

Risks and mitigations

25. The situation with COVID-19 remains highly uncertain and there is a risk of further impacts on the council’s financial projections. This will require close monitoring to ensure council is able to best respond to any changes from the current situation.

Ngā koringa ā-muri

Next steps

26. Finance staff will continue to monitor the financial performance and projections and update this committee when there are further developments.

Ngā tāpirihanga

Attachments

There are no attachments for this report.

Ngā kaihaina

Signatories

Authors

Tracy Xu - Senior Analyst

Susan Jiang Su - Financial Analyst

Pramod Nair - Head of Group Financial Planning

Authorisers

Ross Tucker - General Manager, Financial Strategy and Planning

Peter Gudsell - Group Chief Financial Officer

Finance and Performance Committee

17 June 2021

Exploring alternative funding and financing opportunities

File No.: CP2021/08450

Te take mō te pūrongo

Purpose of the report

1. To approve the approach to exploring alternative funding and financing opportunities for major capital projects.

Whakarāpopototanga matua

Executive summary

2. Auckland Council’s 10-year Budget 2021-2031 provides for significant infrastructure investment to support growth in Auckland and takes a focused approach to investing in the infrastructure that is needed to enable growth in housing and employment. Even with a focused approach, more infrastructure will be required in some key growth areas than currently provided for in the 10-year budget and more funding and financing is required to fill the gap.

3. One of the chief executive’s performance objectives focuses on balance sheet optimisation and includes exploring alternative financing and funding options for major capital projects.

4. The Infrastructure Funding and Financing Act 2020 (IFF) has provided a new tool to accelerate infrastructure investment. This is a funding and financing tool that can enable infrastructure for housing and urban development which supports functioning urban land markets and reduces the impact of local authority funding and financing constraints.

5. Council staff are working with central government officials to investigate how the IFF legislation may assist to accelerate infrastructure investment in key growth areas in Auckland, beginning by looking at Drury.

Ngā tūtohunga

Recommendation/s

That the Finance and Performance Committee:

a) agree to support the continued exploration of opportunities for the use of Infrastructure Funding and Financing Act 2020 mechanisms to enable growth infrastructure.

Horopaki

Context

10-year Budget context

6. The council’s 10-year Budget 2021-2031, agreed on 25 May 2021, provides significant infrastructure investment to support housing and urban development in key growth areas. The 10-year budget takes a focused approach to investing in growth infrastructure, as it is not affordable to invest in all potential growth areas.

7. Through the work done on the Housing and Growth Infrastructure lane of the 10-year budget, it was identified that Auckland Council cannot afford to fund all the infrastructure required to achieve the desired levels of growth in both housing and employment. The current tools cannot keep up with the infrastructure needs of the city given our agreed constraints and a new approach is required.

8. Even with a focused approach, more infrastructure will be required in some key growth areas than currently provided for in the 10-year budget.

9. Some of this infrastructure will be developer mitigation (infrastructure that developers will build and fund themselves to meet resource consent conditions), some infrastructure will not be needed until future decades, and development contributions may therefore help to fund to some extent.

10. However, there will still be a significant funding and financing gap that will lead to delays in delivering infrastructure that will meet growth demands in housing and jobs in Auckland.

11. Council staff have been considering how alternative funding and financing options and the use of our balance sheet can address these constraints.

Chief Executive Performance Objective

12. One of the performance objectives set for the chief executive is focused on council’s balance sheet management.

13. As a part of this work, staff are investigating opportunities to increase and accelerate investment in key infrastructure that can be achieved despite council’s current capital and operating constraints.

Legislative context

14. The Infrastructure Funding and Financing Act 2020 provides another tool to the infrastructure funding toolbox for New Zealand. The IFF enables a funding and financial model to support the provision of infrastructure for housing and urban development that supports functioning urban land markets and reduces the impact of local authority funding and financing constraints.

15. Special Purpose Vehicles will be created for projects and enabled by the legislation to raise finance for the infrastructure through the collection of multi-year levies to repay the finance raised. The multi-year levy amount and term as well as who will pay for the infrastructure (the project beneficiaries) will be presented as part of a proposal and eventually agreed by Cabinet, based on the specifics of each funded project. On completion of the project, the asset will be vested in the council.

16. Staff are recommending a pilot project is selected to investigate how this vehicle works in practice. This would enable us to understand how to use IFF, to understand the type of projects suitable for IFF, and see how IFF fits and aligns with the council’s financial strategy.

Tātaritanga me ngā tohutohu

Analysis and advice

17. Staff have been working with the Crown for several years to identify ways to address Auckland’s growth infrastructure challenge in light of our financial constraints. This work has given rise to the Housing Infrastructure Fund in 2017 (a Crown loan facility for growth infrastructure), the Milldale deal in 2018 (the Crown Infrastructure Partners (CIP) deal to support the Milldale development), and the IFF in 2020.

18. The new IFF legislation provides one possible solution and could potentially support several projects across Auckland but it is important that a solid initial project is identified, and resourced, to test its applicability.

19. A number of projects or programmes that could be funded through the IFF mechanism have been identified such as in the North West, Drury, the South West and Kingseat.

20. In particular, Drury has long been identified as an area for future growth in Auckland. The Auckland Unitary Plan has already live-zoned areas in certain parts of Drury West such as Bremner Road, where some development has already begun. Council’s Future Urban Land Supply Strategy (July 2017) scheduled urban development in Drury West Stage 1 as being development ready from 2022, more development scheduled for Drury West Stage 2 and Drury East in the first half of decade two (2028-2033).

21. The Minister of Finance has repeatedly noted an expectation that the IFF will be used in Drury.

22. Auckland Council and the Crown have entered into a joint work programme on housing and growth. Drury is one of the joint spatial priority areas within this programme that central government and the Auckland Council group are committed to unlocking in a staged and sequenced way.

23. Council staff agree that Drury appears an ideal area for an IFF solution to be investigated.

Drury in discussion

24. The Drury-Opaheke area covers approximately 1,900 hectares of land and the development of the Drury-Opaheke structure plan over 30 years is estimated to provide about 22,000 houses, and about 12,000 jobs with a population of approximately 60,000 people. Infrastructure required to enable this development is significant. There is currently no agreed approach, easy solution, or one straightforward funding plan, as to how this can be financed and funded.

25. In January 2020 central government announced the New Zealand Upgrade Programme which committed funding for five projects related to the ongoing Drury Transport Investment Programme. The June 2021 update to this programme maintained support for this public transport led development, funding rail projects including stations and electrification. The announcement of Crown funding for these projects means that a substantial portion of the infrastructure to support optimal sustainable urban development at Drury is funded. However, to connect this investment to existing networks and for Drury to operate effectively, a significant amount of additional funding is needed.

26. The key traits council staff have identified that support further work on Drury are:

• Benefits of required projects primarily sit with development

• Clear and identified funding gap under current structures

• Multiple landowners and projects that are ready to build subject to infrastructure development

• Land in multiple ownership requiring coordination and cost sharing

• New town / greenfield development, therefore less complexity with needing to align proposed development with existing infrastructure than urban environments / brownfields

• A focus area of the joint working group between council and Crown agencies.

• Substantive work and investigation already done by council and many central government agencies and the substantive knowledge already collated for infrastructure requirements in this area.

27. The IFF is very broad and enabling, however, it is yet to be applied and there are currently no Crown guidelines for submission of an application under the IFF. Auckland Council approached Treasury on this matter and we have commenced a working group. Staff from across the council group and staff from several central government departments, including Treasury, Ministry of Housing and Urban Development (MHUD) and (CIP) are all part of this working group. Its purpose is to use Drury as a possible pilot application to work through the complexities and decisions that need to be made at local and central government levels for a successful IFF application.

28. While several factors continue to change, including the potential for new central government funding under the Housing Acceleration Fund, the working group has begun the initial work to assess scenarios for an IFF scheme based on a clear set of assumptions. As new information becomes available these scenarios can be refined.

29. As this pilot work continues, a number of key issues will emerge for consideration by decision-makers. These are likely to include:

the nature of projects more or less appropriate for an IFF scheme, including location characteristics, timing, size and breadth of benefits

the impact of aligned or misaligned decision-making processes between local and central government

acceptability of different levels of charges and any projected impacts of these on desired outcomes

how charges might be structured

private plan changes seeking to rezone land

the information needed for an eventual IFF application.

30. The challenge of funding and financing growth infrastructure is complex and many different factors will require consideration. Staff recommend that work continues on how the IFF might play a part in addressing this challenge using Drury as a possible pilot project. Staff will regularly report back to the Finance and Performance Committee with updates at the appropriate times.

31. Following work on the Drury pilot, and any other early projects, staff will seek to prepare a structured approach to future opportunities to support consistency of assessment and the application of lessons learned.

Other opportunities

32. While staff intend to focus on Drury as a pilot investigation of IFF opportunities, it is not recommended that other opportunities be disregarded in the meantime. It is recommended that individual initiatives are assessed by staff, with oversight from the group chief financial officer and chief of strategy. Opportunities would then be considered by the Finance and Performance Committee before substantial work was undertaken, including preparation of any formal proposal.

33. The use of IFF as a tool to finance infrastructure spend also needs to be considered alongside other options. In broad terms these could potentially include:

a) using existing debt capacity within our AA/Aa2 credit rating band, given the council has agreed on 25 May 2021 to increase the debt-to-revenue limit to 290% but to target staying below 270% over the long-term

b) using debt beyond our agreed limit and accepting a lower credit rating

c) funding the required infrastructure spend through the sale of assets (including strategic assets) which allows for the resultant debt capacity to be reinvested

d) funding the required infrastructure through additional (or higher) revenue streams (e.g. through rates increases or higher development contributions).

Tauākī whakaaweawe āhuarangi

Climate impact statement

34. The adoption of the recommended approach to exploring alternative funding and financing opportunities for major capital projects has no direct climate impacts.

35. If the council were to propose an IFF scheme to support development within the region, this decision would come back to elected members for consideration. As part of specific analysis of any scheme, staff would assess the degree to which the proposal supports council’s plans and strategies such as the Auckland Plan 2050 and Te Tāruke-ā-Tāwhiri: Auckland’s Climate Plan. Proposals which aim to deliver on compact urban form and sustainable growth would align to actions B1 (ensure our approach to planning and growth aligns with low carbon, resilient outcomes) and B2 (ensure new infrastructure is planned and designed to minimise climate risks and lifecycle emissions) of the climate plan. Decision-making would need to consider the climate impacts of both the infrastructure delivered and the development enabled.

36. Additionally, as a part of the IFF process, the council is required to review any proposal (including those put forward by others) with respect to how it fits into the wider network. This decision-making would also need to consider climate impacts.

37. Transport infrastructure being considered for inclusion in an IFF scheme includes significant investment in active and public transport modes. If development were to be enabled without a structured and planned approach to this investment, then adverse climate impacts could result.

38. One of the intended outcomes of the IFF process is to provide better price signals to landowners and developers of the costs of getting land infrastructure ready. These price signals could influence land prices and the timing and location of development. These changes could impact our projected climate impacts.

39. Climate change adaptation and mitigation is linked with all outcomes of the Auckland Plan. Te Tāruke-ā-Tāwhiri: Auckland’s Climate Plan notes that action on the priorities detailed within Auckland’s Climate Plan will deliver opportunities and benefits across each of the Auckland Plan 2050 outcomes.

Ngā whakaaweawe me ngā tirohanga a te rōpū Kaunihera

Council group impacts and views

40. Staff from across the council group are involved in assessments of infrastructure required to support growth. This particularly includes Auckland Transport, Watercare and the Healthy Waters and Community Facilities departments within Auckland Council.

41. Additionally, in some areas of urban regeneration a key role is undertaken by Eke Panuku.

42. Auckland Unlimited play a role in advice on business development and growth across the region.

Ngā whakaaweawe ā-rohe me ngā tirohanga a te poari ā-rohe

Local impacts and local board views

43. The projects or programmes that are presented for IFF application will go through the council’s project or programme consultation and decision-making processes.

44. No specific local impacts have been identified through the recommended approach. These will be analysed on a site-specific basis as developments progress.

Tauākī whakaaweawe Māori

Māori impact statement

45. The adoption of the recommended approach to exploring alternative funding and financing opportunities for major capital projects does not have any direct impacts on Māori. However, council staff will consider the likely impacts on Māori as specific capital projects are identified and progressed.

46. The projects or programmes that are presented for any IFF application will go through the council’s project or programme consultation and decision-making processes.

Ngā ritenga ā-pūtea

Financial implications

47. The Development Programme Office and council finance team have committed resource to work with the Crown and its entities on the pilot project scheme.

48. There may be some consultant requirements to support the preparation of the application material. The Development Programme Office will use some existing budget and negotiate with the Crown on some contribution required towards the fees we will expend to progress work on the pilot project scheme. There may be a requirement for additional consultancy service fees pending the outcome of the conversations with the Crown.

49. The council monitors two key measures to assess long-term financial sustainability. These are the levels of our debt and our operating position (including funding of depreciation). While the IFF legislation provides a mechanism to enable investment in growth infrastructure without increasing council debt levels, we must also consider the impact on our operating position.

50. As infrastructure is constructed through an IFF scheme it would be vested in the council. The council would then need to fund the depreciation and renewal of these assets as well as the costs of delivering services through them.

51. Growth in operating revenue from development is planned based on population growth rates. If the IFF scheme only redistributes the location of development rather than accelerating the pace of overall development activity within the region beyond that which is already anticipated, then there will be no increased operating revenue to cover the increased costs.

Ngā raru tūpono me ngā whakamaurutanga

Risks and mitigations

52. The council is a submitter in a number of the Drury private plan changes, which are seeking to rezone land for proposed development in the Drury-Opaheke Structure Plan area. Evidence is being prepared for the council (as submitter) in respect of these private plan changes, at the same time as working on a potential solution for infrastructure funding and financing. Given the complexities involved, the timing of this is unlikely to align as it will take longer to complete project selection and approval for this pilot. This means that we are unlikely to have an IFF funding and financing solution agreed in time for the Drury private plan change hearings (or before a decision by independent commissioners on those private plan changes).

Ngā koringa ā-muri

Next steps

53. Staff will continue to work on the pilot project to understand the options and implications of IFF for Auckland Council.

54. This work will be carried out in coordination with the other key stakeholders in respect of Drury (particularly Treasury and MHUD). Input will be obtained from developers as required.

55. The proposed timeline will be:

May to September 2021	• Pilot work with Crown and Auckland Council Group
July to October 2021	• Hearings for Private Plan Changes 48, 49, 50, 51 and 61
October to December 2021	• Provide update to Finance and Performance Committee on pilot projects • Consider how IFF fits alongside development contributions policy (and other tools) • Provide update to Finance and Performance Committee as part of development contributions policy work
January to March 2022	• IFF Policy • Start working on other IFF deals
March to June 2022	• Update Annual Budget as needed

Ngā tāpirihanga

Attachments

There are no attachments for this report.

Ngā kaihaina

Signatories

Authors

Nancy Lu - Lead Advisor Financial Strategy

Michael Burns - Manager Financial Strategy

Fiona Wright - Head of Infrastructure Funding and Development Strategy, Development Programme Officer

Authorisers

John Dunshea - General Manager Development Programmes Office

Ross Tucker - General Manager, Financial Strategy and Planning

Barry Potter - Director Infrastructure and Environmental Services

Peter Gudsell - Group Chief Financial Officer

Finance and Performance Committee

17 June 2021

Auckland Council Group Procurement Policy

File No.: CP2021/07899

Te take mō te pūrongo

Purpose of the report

1. To seek approval for the Auckland Council Group Procurement Policy.

Whakarāpopototanga matua

Executive summary

2. The Auckland Council Group Procurement Policy was approved by the Finance and Performance Committee on 19 September 2017 (Resolution number FIN/2017/121). We have reviewed the policy three years from initial adoption, as planned.

3. This refreshed policy (Attachment A) also includes changes to give effect to recommendation 64 of the review of Auckland Council’s council-controlled organisations which required making ‘compliance with the group procurement policy mandatory on all council-controlled organisations (CCOs) to reduce costs and minimise duplication.’ The review is available at the following link: https://www.aucklandcouncil.govt.nz/about-auckland-council/how-auckland-council-works/council-controlled-organisations/Documents/CCO-review.pdf.

4. We consulted with the CCOs and all have provided their confirmation that they are comfortable with the content and intent of the policy.

5. We made key changes to establish not only accountability, but also further clarify what a group-sourced (joint council and CCOs) procurement opportunity should look like versus what an organisation-sourced opportunity should look like.

Ngā tūtohunga

Recommendation/s

That the Finance and Performance Committee:

a) approve the Auckland Council Group Procurement Policy for immediate adoption by the council group.

b) delegate the authority to make minor edits and changes to the Auckland Council Group Procurement Policy to a group comprising the group chief financial officer for council and the chief financial officers of the council-controlled organisations.

Horopaki

Context

6. On 19 September 2017, the Finance and Performance Committee approved the Auckland Council Group Procurement Policy (Resolution number FIN/2017/121). It was to be reviewed and refreshed three years from initial adoption.

7. In July 2020, the review of Auckland Council’s council-controlled organisations (CCO review) was published with recommendations to improve the model, accountability, and culture of CCOs to facilitate greater collaboration and cooperation across the group.

8. Specifically, recommendation 64 of the CCO review called for ‘compliance with the group procurement policy to be mandatory on all CCOs to reduce costs and minimise duplication.’

9. Following the Governing Body agreeing to the recommendations of the CCO review, we commenced work on the review of the group procurement policy in a collaborative manner between council and the CCOs to give effect to the recommendations.

Tātaritanga me ngā tohutohu

Analysis and advice

10. The current group procurement policy has delivered a number of positive outcomes for council group entities. This includes the ongoing group sourced procurement programme of activity overseen by the steering committee made up of representatives from council, Auckland Transport and Watercare.

11. Our refresh of this group procurement policy was done in a collaborative way with advice and feedback from:

· procurement staff in council and the CCOs

· chief financial officers (CFO) from council and CCOs

· Ngā Mātārae

· chief executive officers (CEO) from council and the CCOs.

12. Overall, feedback was positive and the accountability measures in the draft policy were welcomed.

13. We had specific feedback regarding some categories of procurement activity that are specific to some CCOs, and so are unsuitable to be considered for group procurement activity because there is no duplication. Examples of this would be Auckland Transport’s roading and public transport activities or Watercare’s water treatment and distribution activities.

14. We have made this distinction in the policy between group procurement activities and strategic procurement activities for individual organisations. We will be developing specific guidance for staff in the council and CCOs to follow so that no group opportunities are missed, and that outlines the escalation process for situations when the policy is not complied with.

15. One notable change to the principles is the inclusion, from the recommendation of Auckland Transport, of a new principle six: Safe with us. This requires the group to work together to achieve safe outcomes at all stages of the procurement lifecycle.

Tauākī whakaaweawe āhuarangi

Climate impact statement

16. The group procurement policy references the council’s specific sustainable outcomes identified in the Auckland Plan, Te Tāruke-ā-Tāwhiri: Auckland's Climate Plan, Auckland Waste Management and Minimisation Plan, Long Term Plan, Low Carbon Strategic Action Plan, Regional Land Transport Plan and other initiatives adopted from time to time.

17. The results of council group procurement activity on meeting council’s climate action goals will be measured and reported as part of regular group procurement results reporting.

Ngā whakaaweawe me ngā tirohanga a te rōpū Kaunihera

Council group impacts and views

18. This policy will require changes to the group procurement practices requiring a more structured collaboration model that includes not only the procurement leaders but our category managers and their teams.

19. Our reporting requirement for non-compliance will also result in greater transparency and a more quantitative baseline for any future reviews carried out on the Auckland Council group’s procurement activities.

20. This approach has support from the CCOs.

Ngā whakaaweawe ā-rohe me ngā tirohanga a te poari ā-rohe

Local impacts and local board views

21. We don’t consider the policy has specific impacts on local board activities. However, the importance placed on local procurement and sustainable and social procurement outcomes by local boards is understood.

22. This policy will strengthen the council group’s commitment to delivering against these outcomes from our procurement activity.

Tauākī whakaaweawe Māori

Māori impact statement

23. We have updated Principle 2: Value te ao Māori and Principle 3: Be Sustainable, to reflect council’s Kia Ora Tāmaki Makaurau – Māori Outcomes Performance Measurement Framework, including references to quality employment outcomes for Māori, opportunities for Māori-owned businesses and making our size and scale work for, and with, Māori.

24. We are still actively engaging Ngā Mātārae and others across the group to improve the impact and outcomes our procurement activity can have under these principles.

Ngā ritenga ā-pūtea

Financial implications

25. The current version of our policy and the group-sourced procurement programme has already been delivering substantial procurement benefits, including social and sustainable procurement outcomes. This policy update will lead to us making some operational changes across the group resulting in more collaboration and enhanced procurement benefits and savings.

26. Our group procurement benefits totalled $44.7 million for the 2020/2021 financial year and from the current pipeline of work for the coming financial year, we currently expect $21.2 million, although further benefits are likely as the full pipeline of work is not yet known.

Ngā raru tūpono me ngā whakamaurutanga

Risks and mitigations

27. There is a risk that the changes will not be supported at a business unit level in the council group. These risks will be addressed though the escalation provisions in the policy and relevant CFO and CEO forums.

28. The current global supply chain issues have highlighted challenges for the council group, including the need to conduct enhanced due diligence on suppliers and their supply chains. Principle 4: Act Fairly does require all suppliers to give consideration to council’s ethical standards. If there is evidence of a breach of these standards, staff will take appropriate actions to remedy any breaches.

Ngā koringa ā-muri

Next steps

29. We will be embedding and operationalising new aspects of the policy.

Ngā tāpirihanga

Attachments

No.	Title	Page
a ⇩	Auckland Council Group Procurement Policy 2021 Draft	33

Ngā kaihaina

Signatories

Author

Russell Vaurasi, Manager P2P Support and Compliance

Authorisers

Jazz Singh - General Manager Procurement

Peter Gudsell - Group Chief Financial Officer

Finance and Performance Committee

17 June 2021

Insurance Renewal, Strategy and Progress on Options for Insurance Arrangements

File No.: CP2021/07832

Te take mō te pūrongo

Purpose of the report

1. To provide an update on the 2021/2022 insurance renewal, the development of the proposed three-year insurance strategy commencing 1 July 2021 and the progression of the identification and assessment of options for insurance arrangements to reflect the size and scale of the Auckland Council group.

Whakarāpopototanga matua

Executive summary

2. In the confidential agenda of today’s meeting, there is a report that:

· seeks approval of the indicative 2021/2022 group insurance renewal and the proposed 2021/2022 to 2023/2024 group insurance strategy.

· updates progress on the assessment of options for insurance arrangements moving forward.

3. That report is in the confidential section of the agenda, as it contains details of the proposed insurance strategy, and policies and programmes for which terms and costings are being sought from and being negotiated with the insurance market.

4. The council group’s annual insurance programme is due to expire on 30 June 2021.

5. In 2020, all insurance policies purchased under the programme were reviewed. The purpose of the review was to ensure that the insurance cover was fit for purpose to mitigate relevant business risks.

6. The insurance industry has undergone significant change over the last three years. While the market has stabilised in some areas such as above-ground property insurance, the disruption caused by the COVID-19 pandemic poses uncertainty in other areas of the insurance market.

7. Along with COVID-19, climate change is a focus area for insurers. Insurers are now applying increased scrutiny to the environmental practices of high-risk industries.

8. Insurers are requiring additional information around the council group's risk management mechanisms. They are seeking risk management information on consenting with respect to professional indemnity insurance and information technology security with respect to cyber insurance.

9. We have made progress in improving the integrity of asset data for the upcoming renewal. This includes improved integration and alignment of asset data between relevant council departments (insurance, asset management and finance) and insurers.

10. Contestability in the insurance programme is achieved by council and our insurance broker, Aon New Zealand Limited (Aon) marketing placements with a range of insurers – both locally and overseas. A range of factors are considered in making placements including price, coverage terms and the stability of the insurers. The performance of Aon is managed by the general manager risk and assurance and the group treasurer. Insurance brokerage services are tendered on a regular basis.

11. The overall indicative group premium is provided for in the 2021/2022 budget.

12. Finalisation of the terms and cost of the 2021/2022 group insurance renewal will not occur until immediately prior to 30 June 2021. As such, the confidential paper seeks a delegation for the finalisation of the arrangements to the chair of the Finance and Performance Committee and the group chief financial officer.

13. The draft insurance strategy was referred to the Audit and Risk Committee for review in February 2021, and for final endorsement in May 2021. The feedback received from the committee has been addressed through the insurance options review.

14. The insurance options review has been progressed to the point where practical options have been identified and assessed. These options will be subject to review by the Executive Leadership Team. The identified options will be workshopped with this committee on 30 June 2021.

Ngā tūtohunga

Recommendation/s

That the Finance and Performance Committee:

a) note that there is a confidential report included in the agenda which contains information on:

i) the proposed indicative group insurance renewal for 2021/2022

ii) the proposed group insurance strategy for the three years commencing 1 July 2021

iii) progress made in identifying and assessing practical options for insurance arrangements to reflect the size and scale of the Auckland Council group.

Horopaki

Context

15. The Audit and Risk Committee, at its meeting on 22 May 2021, considered and noted the proposed indicative council group insurance programme for 2021/2022, and the group insurance strategy for the three years commencing 1 July 2021. At that meeting, the Audit and Risk Committee also received an update on progress made in identifying options to optimise insurance arrangements, and the cumulative loss modelling study.

Tātaritanga me ngā tohutohu

Analysis and advice

Renewal approach for 2021-2022

16. The Auckland Council group’s annual insurance programme is due to expire on 30 June 2021.

17. The objective of the group’s insurance programme is to ensure that the group has financial resources to recover from catastrophic and other events and fund unforeseen losses to assets and impacts on services.

18. In 2020, all insurance policies purchased under the programme were reviewed. The purpose of the review was to ensure that the insurance cover was fit for purpose to mitigate relevant business risks.

19. Preparation for the upcoming renewal started in December 2020 with the following activities undertaken in the last five months:

· further improvement in data integrity for property assets

· updating of valuations from external valuers

· asset risk surveys for 14 group assets, including the recently built 36th Americas Cup assets

· renewal submissions and remarketing of the group programme to local and overseas markets

20. Improvements in the integrity of asset data for the upcoming renewal includes improved integration and alignment of asset data between relevant council departments (insurance, asset management and finance) and insurers.

Group insurance strategy

21. The Auckland Council group’s previous insurance strategy expired in December 2020.

22. Staff submitted a draft of the proposed three-year insurance strategy to the Audit and Risk Committee for review and feedback in February 2021.

The cumulative loss modelling study update

23. The purpose of the cumulative loss modelling study is to determine the range of potential financial losses the group could incur due to natural hazard events. The hazard events in scope for the study are earthquakes, volcanic eruption, flooding (pluvial, fluvial and coastal) and storms. The study results will be used to optimise the group's risk funding options, including insurance.

24. Stages one and two of the study were completed in 2020. The initial stages provided a region-wide view of asset distribution, values and a high-level hazard exposure assessment.

25. An introductory technical group has been formed. The technical group has further refined the scope for the next three stages of the study. A high-level overview of the scope is noted below:

· stage three - carry out a deterministic or scenario-based analysis of flooding and earthquake to help define loss limits and residual exposure to the balance sheet

· stage four - carry out a probabilistic analysis to estimate loss potential across a range of annual return intervals for earthquakes, floods, tsunamis and volcanic activity

· stage five - determine third party exposure and climate change implications.

26. Following discussions with the technical group, a series of workshops have been conducted to obtain feedback on the proposed scope from the council group stakeholders.

27. A business case is being prepared to seek appropriate approvals from the ELT sponsors to commence work on stage three of the study in 2021/2022.

The insurance options review

28. In November 2020, the Governing Body approved the performance objectives of the chief executive. Under the performance objective of Balance Sheet Management, the following insurance-related measure was included:

Optimise insurance arrangements to reflect the size and scale of Auckland Council group and appropriate transfer and management of Auckland Council group risks.

29. To deliver on the chief executive objective, we have identified and assessed options for self- insurance.

30. The options will be workshopped with this committee on 30 June 2021.

Tauākī whakaaweawe āhuarangi

Climate impact statement

31. No direct climate implications arise from this information report. However, climate change response is a focus for insurers who are applying increased scrutiny to the environmental practices of high-risk industries.

Ngā whakaaweawe me ngā tirohanga a te rōpū Kaunihera

Council group impacts and views

32. Representatives from all the CCOs and the council continue to work collaboratively through the insurance leadership group to complete the renewal and ensure adequate risk management.

Ngā whakaaweawe ā-rohe me ngā tirohanga a te poari ā-rohe

Local impacts and local board views

33. The placement of insurance for the council group is a region-wide issue and not specific to a particular local board, and no local boards are specifically impacted by this matter. Accordingly, there has not been any consultation undertaken directly with local boards.

Tauākī whakaaweawe Māori

Māori impact statement

34. The council group insurance programme extends to the Independent Māori Statutory Board, the Tūpuna Maunga o Tāmaki Makaurau Authority, the Ngāti Whātua Ōrākei Reserves Board and Te Poari o Kaipātiki ki Kaipara (formerly the Parakai Recreation Reserve Board).

Ngā tāpirihanga

Attachments

There are no attachments for this report.

Ngā kaihaina

Signatories

Authors

Varsha Prasad - Senior Insurance and Claims Advisor

Mark Maloney - General Manager Risk and Assurance

John Bishop - Group Treasurer

Authorisers

Phil Wilson - Governance Director

Peter Gudsell - Group Chief Financial Officer

Finance and Performance Committee

17 June 2021

Summary of Finance and Performance Committee information memoranda and briefings, including the Forward Work Programme - 17 June 2021

File No.: CP2021/07216

Te take mō te pūrongo

Purpose of the report

1. To note progress on the 2021 forward work programme appended as Attachment A.

2. To receive a summary and provide a public record of workshops, memoranda or briefing papers that may have been held or been distributed to Finance and Performance Committee members.

Whakarāpopototanga matua

Executive summary

3. This is a regular information-only report which aims to provide greater visibility of information circulated to committee members via memoranda/briefings or other means, where no decisions are required.

4. The following information has been circulated to members:

Date	Subject
11/5/2021	Memorandum from Warren Marshall, Auckland Insights Manager – Minor revisions to the 10-year Budget 2021-2031 Consultation - Summary of feedback received – Attachment B

5. The following confidential workshops have taken place and the minutes can now be released:

Date	Workshop/Briefing
16/9/2020	Finance and Performance Committee workshop (10-year Budget 2021-2031) – Attachment C
23/9/2020	Finance and Performance Committee workshop (10-year Budget 2021-2031) – Attachment D
14/10/2020	Finance and Performance Committee workshop (10-year Budget 2021-2031) – Attachment E Note: Redactions have been made to this document as the withholding of the information is necessary to enable the local authority to carry on, without prejudice or disadvantage, negotiations (including commercial and industrial negotiations); and to maintain the effective conduct of public affairs through the free and frank expression of opinions by or between or to members or officers or employees of any local authority, or any persons to whom section 2(5) applies, in the course of their duty under sections 7(2)(i) and section 7(2)(f)(i) of the Local Government Official Information and Meetings Act 1987
21/10/2020	Finance and Performance Committee workshop (10-year Budget 2021-2031) – Attachment F
28/10/2020	Finance and Performance Committee workshop (10-year Budget 2021-2031) – Attachment G Note: Redactions have been made to this document as the withholding of the information is necessary to enable the local authority to carry on, without prejudice or disadvantage, negotiations (including commercial and industrial negotiations) under section 7(2)(i) of the Local Government Official Information and Meetings Act 1987
4/11/2020	Finance and Performance Committee workshop (10-year Budget 2021-2031) – Attachment H
11/11/2020	Finance and Performance Committee workshop (10-year Budget 2021-2031) – Attachment I
18/11/2020	Finance and Performance Committee workshop (10-year Budget 2021-2031) – Minutes - Attachment J
18/11/2020	Finance and Performance Committee workshop (10-year Budget 2021-2031) – Presentation - Attachment K Note: Redactions have been made to this document as the withholding of the information is necessary to maintain the effective conduct of public affairs through the free and frank expression of opinions by or between or to members or officers or employees of any local authority, or any persons to whom section 2(5) applies, in the course of their duty; to enable any local authority holding the information to carry out, without prejudice or disadvantage, commercial activities; and to enable the local authority to carry on, without prejudice or disadvantage, negotiations (including commercial and industrial negotiations) under sections 7(2)(f)(i) and 7(2)(h) of the Local Government Official Information and Meetings Act 1987
25/11/2020	Finance and Performance Committee workshop (10-year Budget 2021-2031) - Minutes – Attachment L
25/11/2020	Finance and Performance Committee workshop (10-year Budget 2021-2031) – Presentation – Attachment M
2/12/2020	Finance and Performance Committee workshop (10-year Budget 2021-2031) – Attachment N
10/2/2021	Finance and Performance Committee workshop (10-year Budget 2021-2031) – Attachment O
14/4/2021	Finance and Performance Committee workshop (10-year Budget 2021-2031) – Attachment P
21/4/2021	Finance and Performance Committee workshop (10-year Budget 2021-2031) – Attachment Q
28/4/2021	Finance and Performance Committee workshop (10-year Budget 2021-2031) – Attachment R
3/5/2021	Finance and Performance Committee workshop (10-year Budget 2021-2031) – Attachment S
5/5/2021	Finance and Performance Committee workshop (10-year Budget 2021-2031) – Attachment T
10/5/2021	Finance and Performance Committee workshop (10-year Budget 2021-2031) – Attachment U
12/5/2021	Finance and Performance Committee workshop (10-year Budget 2021-2031) – Attachment V
19/5/2021	Finance and Performance Committee workshop (10-year Budget 2021-2031) – Attachment W

These documents can be found on the Auckland Council website, at the following link: http://infocouncil.aucklandcouncil.govt.nz/

o at the top left of the page, select meeting/Te hui “Finance and Performance Committee” from the drop-down tab and click “View”;

o under ‘Attachments’, select either the HTML or PDF version of the document entitled ‘Extra Attachments’.

6. The following workshops have taken place:

Date	Workshop/Briefing
9/6/2021	Finance and Performance Committee workshop (Development Contributions) – Attachment X
9/6/2021	Finance and Performance Committee confidential workshop (Value for Money Programme) – no attachment

These documents can be found on the Auckland Council website, at the following link: http://infocouncil.aucklandcouncil.govt.nz/

o at the top left of the page, select meeting/Te hui “Finance and Performance Committee” from the drop-down tab and click “View”;

o under ‘Attachments’, select either the HTML or PDF version of the document entitled ‘Extra Attachments’.

7. Note that, unlike an agenda report, staff will not be present to answer questions about the items referred to in this summary. Committee members should direct any questions to the authors.

Ngā tūtohunga

Recommendation/s

That the Finance and Performance Committee:

a) receive the progress on the 2021 forward work programme as appended in Attachment A of the agenda report.

b) receive the Summary of Finance and Performance Committee information memorandum and briefings as at 17 June 2021.

Ngā tāpirihanga

Attachments

No.	Title	Page
a ⇩	Finance and Performance Committee Forward Work Programme	51
b ⇨	Memorandum - Minor revisions to the 10-year Budget 2021-2031 Consultation - Summary of feedback received, 11 May 2021 (Under Separate Cover)
c ⇨	Finance and Performance Committee workshop (10-year Budget 2021-2031) - 16 September 2020 (Under Separate Cover)
d ⇨	Finance and Performance Committee workshop (10-year Budget 2021-2031) - 23 September 2020 (Under Separate Cover)
e ⇨	Finance and Performance Committee workshop (10-year Budget 2021-2031) - 14 October 2020 (Under Separate Cover)
f ⇨	Finance and Performance Committee workshop (10-year Budget 2021-2031) - 21 October 2020 (Under Separate Cover)
g ⇨	Finance and Performance Committee workshop (10-year Budget 2021-2031) - 28 October 2020 (Under Separate Cover)
h ⇨	Finance and Performance Committee workshop (10-year Budget 2021-2031) - 4 November 2020 (Under Separate Cover)
i ⇨	Finance and Performance Committee workshop (10-year Budget 2021-2031) - 11 November 2020 (Under Separate Cover)
j ⇨	Finance and Performance Committee workshop (10-year Budget 2021-2031) - Minutes - 18 November 2020 (Under Separate Cover)
k ⇨	Finance and Performance Committee workshop (10-year Budget 2021-2031) - Presentation - 18 November 2020 (Under Separate Cover)
l ⇨	Finance and Performance Committee workshop (10-year Budget 2021-2031) - 25 November 2020 - Minutes (Under Separate Cover)
m ⇨	Finance and Performance Committee workshop (10-year Budget 2021-2031) - 25 November 2020 - Presentation (Under Separate Cover)
n ⇨	Finance and Performance Committee workshop (10-year Budget 2021-2031) - 2 December 2020 (Under Separate Cover)
o ⇨	Finance and Performance Committee workshop (10-year Budget 2021-2031) - 10 February 2021 (Under Separate Cover)
p ⇨	Finance and Performance Committee workshop (10-year Budget 2021-2031) - 14 April 2021 (Under Separate Cover)
q ⇨	Finance and Performance Committee workshop (10-year Budget 2021-2031) - 21 April 2021 (Under Separate Cover)
r ⇨	Finance and Performance Committee workshop (10-year Budget 2021-2031) - 28 April 2021 (Under Separate Cover)
s ⇨	Finance and Performance Committee workshop (10-year Budget 2021-2031) - 3 May 2021 (Under Separate Cover)
t ⇨	Finance and Performance Committee workshop (10-year Budget 2021-2031) - 5 May 2021 (Under Separate Cover)
u ⇨	Finance and Performance Committee workshop (10-year Budget 2021-2031) - 10 May 2021 (Under Separate Cover)
v ⇨	Finance and Performance Committee workshop (10-year Budget 2021-2031) - 12 May 2021 (Under Separate Cover)
w ⇨	Finance and Performance Committee workshop (10-year Budget 2021-2031) - 19 May 2021 (Under Separate Cover)
x ⇨	Finance and Performance Committee workshop (Development Contributions) - 9 June 2021 (Under Separate Cover)

Ngā kaihaina

Signatories

Author	Sandra Gordon - Kaitohutohu Mana Whakahaere Matua / Senior Governance Advisor
Authoriser	Peter Gudsell - Group Chief Financial Officer

Finance and Performance Committee

17 June 2021

Te Komiti ā-Pūtea, ā-Mahi Hoki/Finance and Performance Committee
Forward Work Programme 2021/22

This committee controls expenditure across the Auckland Council Group and deals with the overall financial management and performance of the council parent organisation and Auckland Council Group and makes financial decisions outside of the annual budgeting processes. The full terms of reference can be found here: Auckland Council Governing Body Terms of Reference

Area of work and Lead Department	Reason for work	Committee role (decision and/or direction)	Expected timeframes 2021
Area of work and Lead Department	Reason for work	Committee role (decision and/or direction)	Jan	Feb	Mar	Apr	May	Jun	Jul	Aug	Sep	Oct	Nov	Dec
Planning and funding
10-year Budget (Long Term Plan) 2021-2031 General Manager Financial Strategy and Planning	Statutory Process	Hold workshops regarding process/content/policies Decision to agree Mayoral Proposal (9 Dec 2020) Recommend consultation document to consult with public (Feb 2020) Adopt consultation document to consult with public (18 Feb 2020) (Governing Body) Consultation period – 22 February 2021 – 22 March 2021 Hear feedback and deliberate budget scenarios (Apr/May 2021) Decisions made for Long-Term Plan (25 May 2021) Recommend final Long-Term Plan (25 May 2021) Adopt final Emergency Budget (Governing Body) (29 June 2021) Progress to date: Workshops held (26 August 2020, 9 September 2020, 16 September 2020, 23 September 2020, 14 October 2020, 21 October 2020, 28 October 2020, 4 November 2020, 11 November 2020, 18 November 2020, 25 November 2020, 2 December 2020, 10 February 2021, 10 March 2021, 14 April 2021, 21 April 2021, 28 April 2021, 3 May 2021, 5 May 2021, 10 May 2021, 12 May 2021 and 19 May 2021) 10-year Budget 2021-2031 – Process overview – Link to decision 10-year Budget 2021-2031 – 10-Year Budget 2021-2031 - Adoption of the Draft Tūpuna Maunga o Tāmaki Makaurau Operational Plan 2021/2022 and summary – Link to decision Link to governing body decision 10-year Budget 2021-2031: regional topics for consultation - local board input– Link to decision 10-year Budget 2021-2031 - Mayoral Proposal items for consultation – Link to decision Link to governing body decision 10-year Budget 2021-2031 - Other matters for consultation – Link to decision – Link to Governing Body decision Changes to the Urban Rating Area and Rating of Farm and Lifestyle Properties within the Urban Rating Area – Link to decision Link to Governing Body decision Other Rates and Fees Issues for 10-Year Budget 2021-2031 – Link to decision Link to Governing Body decision Upper Harbour Local Board Transport Targeted Rate for consultation - Link to decision Item withdrawn at Governing Body meeting, 17 December 2020. Paremoremo Public Transport Targeted Rate – Link to decision Link to Governing Body decision Amendments to the Revenue and Financing Policy – Link to decision Link to Governing Body decision 10-year Recovery Budget 2021-2031: Adoption of consultation material - Link to decision Link to Governing Body decision 10-year Recovery Budget 2021-2031 Communications and Engagement Plan - Link to decision Link to Governing Body decision Accommodation Provider Targeted Rate Suspension – Link to decision Overview to decision making for the Recovery Budget (10-year Budget 2021-2031) – Link to decision Recovery Budget (10-year Budget 2021-2031) - local board feedback and advocacy – Link to decision Recovery Budget (10-year Budget 2021-2031) - Mayor's final proposal – Link to decision Adoption of the recommendations from the 25 May 2021 Finance and Performance Committee relating to Recovery Budget (10-year Budget 2021-2031) Mayor's final proposal - Link to Governing Body decision Recovery Budget (10-year Budget 2021-2031): Other proposals – Link to decision Adoption of the recommendations from the 25 May 2021 Finance and Performance Committee relating to Recovery Budget (10-year Budget 2021-2031): Other proposals - Link to Governing Body decision Paremoremo Public Transport Targeted Rate – Link to decision Adoption of the recommendations from the 25 May 2021 Finance and Performance Committee relating to the Paremoremo Public Transport Targeted Rate - Link to Governing Body decision Changes to the Urban Rating Area and Rating of Farm and Lifestyle Properties within the Urban Rating Area – Link to decision Adoption of the recommendations from the 25 May 2021 Finance and Performance Committee relating to Changes to the Urban Rating Area and Rating of Farm and Lifestyle Properties within the Urban Rating Area - Link to Governing Body decision Other Rates and Fees Issues for Recovery Budget (10-year Budget 2021-2031) – Link to decision Adoption of the recommendations from the 25 May 2021 Finance and Performance Committee relating to Other Rates and Fees Issues for the Recovery Budget (10-year Budget 2021-2031) - Link to Governing Body decision
Annual Budget (2022/2023) General Manager Financial Strategy and Planning	Statutory Process	Hold workshops regarding process/content/policies Decision to agree Mayoral Proposal (Dec 2021) Recommend consultation document to consult with public (Feb 2022) Adopt consultation document to consult with public (Feb 2022) (Governing Body) Consultation period – To be confirmed Hear feedback and deliberate budget scenarios (Apr/May 2022) Decisions made for Annual Budget (May 2022) Recommend final Annual Budget (June 2022) Adopt final Annual Budget (Governing Body) (June 2022)
Half-yearly and annual reporting Group Treasurer and Group Financial Controller	Statutory requirement and NZX listing requirement	Receive and approve half-year and preliminary full year NZX release (delegation to chair and deputy chair) (Feb) Receive annual report (16 Sept - extraordinary) Recommend adoption of annual report to Governing Body (16 Sept - extraordinary) Note: · NZX announcements are presented to the Audit and Risk Committee · There is a delegation from the Committee to Chair and Deputy Chair of Finance and Performance to approve the release of the interim and full year Auckland Council group financial results to the NZX for each reporting period through to 30 June 2022. · Formal adoption of annual report is by the Governing Body Progress to date: Auckland Council Group and Auckland Council quarterly performance report for the 6 months to 31 December 2020 – Link to decision
Financial and Budget Updates General Manager Financial Strategy and Planning	Financial Management	Receive updates and make decisions on any recommended budget changes outside of the Annual Budget/Long-term Plan, as required Note: This includes significant unbudgeted one-off expenditure. Progress to date: Emergency Budget 2020/2021 - Update February 2021 (considered in confidential; restatements only released to the open record) – Link to decision Emergency Budget 2020/2021 - Update March 2021 – Link to decision Emergency Budget 2020/2021 – Update April 2021 – Link to decision Emergency Budget 2020/2021 – Update May 2021 – Link to decision
Loan guarantees and grant funding Group Treasurer	Financial management	Review information and make decisions on loan guarantees and restructuring (including Parks) Receive an update on the Eden Park loan guarantee and grant funding (six-monthly) Receive progress update memos when appropriate Progress to date: Q Theatre loan and funding (considered in confidential, resolutions released to the open record) – Link to decision Presentation from Eden Park Trust Board – Link to decision
Reporting and performance
Performance reporting quarterly – parent General Manager Financial and Business Performance	Financial management	Monitor council parent financial and non-financial performance results on a quarterly basis, including Māori outcomes expenditure. Q2 (Mar), Q3 (May), Q4 (16 Sept - Extraordinary), Q1 (Dec) Note: Reporting in September must be considered as a confidential report until results are sent to NZX at the end of September. Progress to date: Auckland Council Group and Auckland Council quarterly performance report for the 6 months to 31 December 2020 – Link to decision Auckland Council Group and Auckland Council quarterly performance report for the 9 months to 31 March 2021 – Link to decision
Performance reporting quarterly – group General Manager Financial Strategy and Planning	Financial management	Monitor Auckland Council group financial requirements on a quarterly basis. Q2 (Mar), Q3 (May), Q4 (16 Sept - Extraordinary), Q1 (Dec) Note: Reporting in September must be considered as a confidential report until results are sent to NZX at the end of September. Progress to date: Auckland Council Group and Auckland Council quarterly performance report for the 6 months to 31 December 2020 – Link to decision Auckland Council Group and Auckland Council quarterly performance report for the 9 months to 31 March 2021 – Link to decision
Operational
Disposals Auckland Council and Panuku Development Auckland	Panuku, working with all areas of council, is required through its Statement of Intent to identify and recommend to council properties that are surplus to requirements and can be considered for disposal. These include general disposals to fund Long-term Plan projects.	Agree to proceed with recommended disposals or acquisition, as required. Progress to date: Recommendation from Parks, Arts, Community and Events Committee, 10 December 2020 - Proposed exchange of reserve land at Watchfield Close and Mayflower Park - Māngere East and West – Link to decision C40 development additional land disposal recommendation – 331 (part) Great North Road, Henderson Link to decision Disposal Recommendation report – part of 16 Amersham Way, Manukau – Link to decision Note: Properties are recommended for acquisitions and disposal to the committee for approval in accordance with the Long-term Plan/Annual Budget. Properties are also identified for disposal via the Emergency Budget 2020/2021 asset recycling process. Progress to date: Memorandum – Emergency Budget 2021/2021 – Asset Recycling – Reserve Revocation – 23 February 2021 – Link to memorandum	As required
Funding and Levies (including Auckland Regional Amenities Funding Board, Museum of Transport and Technology and Auckland War Memorial Museum) Manager CCO/ External Partnerships team	Statutory process	Approve annual funding levies for Auckland Regional Amenities Funding Board (Mar); Museum of Transport and Technology (Apr); and Auckland War Memorial Museum (Apr) Receive presentations from amenities via memorandum (May/Jun) Progress to date: Approval of the Auckland Regional Amenities Funding Levy – Link to decision (note this report was deferred until 22 April 2021) Consideration of ARAFA, MOTAT and Auckland Museum annual plans and council funding contributions, 2021/2022 – Link to decision Presentations from the Auckland Regional Amenities – Link to decision
Insurance Strategy and Placement GM Risk and Assurance		Approve the council group insurance strategy 2021-2023 Approve the annual insurance placement for Council Group 2021/2022 Progress to date:
Review of Policies		Approve council policies: · Treasury Management Policy (May) · Group Procurement Policy (June) · Revenue and Financing Policy (through the 10-year Budget process) · Development Contribution Policy (Sept – Governing Body) · Business Improvement District Policy (Dec) · Significance and Engagement Policy Progress to date: Treasury Management Policy review – Link to decision
Review of committee forward work programme Governance	Regular reporting	Receive updates (bi-monthly) Review content of the forward work programme (six-monthly)

Updated: 11 June 2021

Chairperson	Cr Desley Simpson, JP
Deputy Chairperson	Cr Shane Henderson
Members	Cr Josephine Bartley	Mayor Hon Phil Goff, CNZM, JP
	IMSB Member Renata Blair	Cr Richard Hills
	Cr Dr Cathy Casey	Cr Tracy Mulholland
	Deputy Mayor Cr Bill Cashmore	Cr Daniel Newman, JP
	Cr Fa’anana Efeso Collins	Cr Greg Sayers
	Cr Pippa Coom	Cr Sharon Stewart, QSM
	Cr Linda Cooper, JP	IMSB Chair David Taipari
	Cr Angela Dalton	Cr Wayne Walker
	Cr Chris Darby	Cr John Watson
	Cr Alf Filipaina	Cr Paul Young
	Cr Christine Fletcher, QSO