I hereby give notice that an ordinary meeting of the Council Controlled Organisation Oversight Committee will be held on:

 

Date:

Time:

Meeting Room:

Venue:

 

Tuesday, 20 September 2022

10.00am

Reception Lounge

Auckland Town Hall
301-305 Queen Street

Auckland

 

Kōmiti Aromātai Whakahaere Kaupapa Kei Raro I

Te Maru O te Kaunihera / Council Controlled

Organisation Oversight Committee

 

OPEN AGENDA

 

MEMBERSHIP

Chairperson

Deputy Mayor Cr Bill Cashmore

 

Deputy Chairperson

Cr Angela Dalton

 

Members

Cr Josephine Bartley

Cr Richard Hills

 

Cr Dr Cathy Casey

Cr Tracy Mulholland

 

Cr Fa’anana Efeso Collins

Cr Daniel Newman, JP

 

Cr Pippa Coom

Cr Greg Sayers

 

Cr Linda Cooper, JP

Cr Desley Simpson, JP

 

Cr Chris Darby

Cr Sharon Stewart, QSM

 

Cr Alf Filipaina, MNZM

IMSB Chair David Taipari

 

Cr Christine Fletcher, QSO

Cr Wayne Walker

 

Mayor Hon Phil Goff, CNZM, JP

Cr John Watson

 

IMSB Member Hon Tau Henare

Cr Paul Young

 

Cr Shane Henderson

 

 

(Quorum 11 members)

 

 

Duncan Glasgow

Kaitohutohu Mana Whakahaere Matua /

Senior Governance Advisor

 

15 September 2022

 

Contact Telephone: (09) 890 2656

Email: duncan.glasgow@aucklandcouncil.govt.nz

Website: www.aucklandcouncil.govt.nz

 



 

Terms of Reference

 

Responsibilities

 

The purpose of the committee is to:

 

·         have a general overview and insight into the strategy, direction and priorities of all Council Controlled Organisations (CCO)

·         set policy relating to CCO governance

·         approve CCO Statements of Intent

·         monitor performance of CCOs and other entities in which the council has an equity interest (such as CRLL, Tāmaki Regeneration Company and Haumaru Housing).

 

Key responsibilities include:

 

·         monitoring the financial and non-financial performance targets, key performance indicators, and other measures of each CCO and the performance of each organisation

·         advising the mayor on the content of the annual Letters of Expectations (LoE) to CCOs and Ports of Auckland Limited

·         exercising relevant powers under Schedule 8 of the Local Government Act 2002, which relate to the Statements of Intent of CCOs

·         exercising relevant powers under Part 1 of the Port Companies Act 1988, which relate to the Statements of Corporate Intent for port companies

·         exercising Auckland Council’s powers as a shareholder or given under a trust deed, including but not limited to modification of constitutions and/or trust deeds, granting shareholder approval of major transactions where required, exempting CCOs, and approving policies relating to CCO and CO governance

·         approval of a work programme which includes a schedule of quarterly reporting of each CCO to balance reporting across the meetings.

 

Powers

 

(i)         All powers necessary to perform the committee’s responsibilities.

Except:

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

(b)          where the committee’s responsibility is limited to making a recommendation only

(ii)        Power to establish subcommittees.

 

 

Code of conduct

 

For information relating to Auckland Council’s elected members code of conduct, please refer to this link on the Auckland Council website - https://www.aucklandcouncil.govt.nz/about-auckland-council/how-auckland-council-works/elected-members-remuneration-declarations-interest/Pages/elected-members-code-conduct.aspx

 

 


 

Auckland Plan Values

 

The Auckland Plan 2050 outlines a future that all Aucklanders can aspire to. The values of the Auckland Plan 2050 help us to understand what is important in that future:

 

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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.

 

 


Council Controlled Organisation Oversight Committee

20 September 2022

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ITEM   TABLE OF CONTENTS                                                                                         PAGE

1          Apologies                                                                                                                        9

2          Declaration of Interest                                                                                                   9

3          Confirmation of Minutes                                                                                               9

4          Petitions                                                                                                                          9  

5          Public Input                                                                                                                    9

6          Local Board Input                                                                                                          9

7          Extraordinary Business                                                                                              10

8          Quarter four performance reports 2021/2022 for substantive council-controlled organisations and 2021/2022 Ports of Auckland Limited annual report               11

9          Council-controlled Organisations accountability requirements exemptions    191

10        Liaison councillors' updates                                                                                    197

11        Summary of Council Controlled Organisation Oversight Committee information memoranda and briefings (including the forward work programme) - 20 September 2022                                                                                                                             199

12        Consideration of Extraordinary Items

 


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 Council Controlled Organisation Oversight Committee:

a)         confirm the ordinary minutes of its meeting, held on Tuesday, 6 September 2022, including the confidential section, 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.

 

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

 

 


 

 

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.”


Council Controlled Organisation Oversight Committee

20 September 2022

 

Quarter four performance reports 2021/2022 for substantive council-controlled organisations and 2021/2022 Ports of Auckland Limited annual report

File No.: CP2022/13190

 

  

 

Te take mō te pūrongo

Purpose of the report

1.       To receive a high-level summary of the substantive Council-Controlled Organisation (CCO) fourth quarter reports (period ending 30 June 2022).

2.       To receive the Ports of Auckland Limited (POAL) annual report and the 2021/2022 full year results for the key performance indicators in the 2021-2024 Statement of Corporate Intent.

Whakarāpopototanga matua

Executive summary

3.       Under Auckland Council’s accountability framework, each substantive CCO must provide a quarterly report to the CCO Oversight Committee. The reports for the fourth quarter of 2020/2021 are contained in Attachments A to E and are measured against the updated (previous) 10-year Budget and the 2021-2024 Statements of Intent (SOIs).

4.       It should be noted that the CCO financial and non-financial results as presented in the quarter four reports are unaudited.

5.       Under the Memorandum of Understanding (MOU) between POAL and the council, POAL is required to provide annual reports to council on the matters and within the timeframes specified in the Port Companies Act 1988. POAL’s audited annual report is attached as Attachment F.  Attachment G provides POAL’s full year results for the key performance indicators against the annual targets in the 2021-2024 Statement of Corporate Intent (SCI).

Auckland Transport (AT)

6.       Safety targets continue to be challenging, with the expected reductions in deaths and serious injuries (DSI) not being met. The long-term trend continues to decline against the 2017 baseline, but not as fast as targeted. Delivery on programmes to upgrade intersections and corridors is however progressing well.  AT will continue to work with other partners to achieve the rate of improvement in safety that is sought.

7.       Public transport recovery continues to be impacted by COVID-19.  A range of factors are contributing, including changes in travel patterns, as well as issues such as the bus driver shortage and absenteeism for sickness. 

8.       Positive results included delivery of cycleways, which exceeded the trajectory to the three-year target, and a 27 per cent reduction in AT’s corporate emissions. 

9.       Capital delivery is at 80 per cent of the plan, with many programmes affected by COVID-19.  Both operational revenue and expenditure are below budgets, with stringent management in place for expenditure to manage the lower revenue produced by the public transport income, and parking and enforcement revenues being lower than budgeted. 

Eke Panuku

10.     Eke Panuku have met nine of their 11 performance measure targets for 2021/2022, based on unaudited results. This includes 358 net new dwelling units completed (against a target of 350) and 23,065 square meters of public realm works completed (against a target of 21,000 square meters).

11.     Two targets were not met. The asset recycling target agreed with council was not achieved due to a recent decline in the property market. Secondly the target for complaints resolved within 10 working days was not met, much of this was due to complaints relating to one project taking longer to resolve.

12.     Capital expenditure is $41.1 million against a budget of $86.9 million.  Eke Panuku noted the underspend is due to a range of factors including delays associated with interdependent projects and the wider impacts of COVID-19 restrictions. Both operational revenue and expenditure are favourable to the budget(s).

Tātaki Auckland Unlimited

13.     Tātaki Auckland Unlimited has 11 SOI performance measures of which six achieved their targets at quarter four, one was substantially achieved, and the remaining four measures targets were not met.  Where targets were not achieved, this can largely be attributed to impacts from COVID-19, including the closure of Tātaki Auckland Unlimited facilities for periods in quarters one and two, audience/visitor limitations in quarter three and multiple event cancellations and postponements.

14.     Tātaki Auckland Unlimited had a net direct expenditure of $112.6 million for the year, which is slightly favourable to budget. This favourable variance is due to changes in the timing of planned expenditure in response to the COVID-19 driven adverse revenue results and uncertainties regarding future revenues. Capital spend is $42.8 million against a budget of $56.7 million (75.5 per cent). The underspend has largely been deferred into the financial year 2022/2023.

15.     Early in quarter four, New Zealand moved to the ‘Orange’ traffic light setting under the COVID-19 Protection Framework. Capacity limits were fully removed, which had a positive impact on Tātaki Auckland Unlimited’s facilities and venues performance. With borders now open, Tātaki Auckland Unlimited have been working urgently with partners to re-establish international connectedness across content, travel, skills, trade and investment.

Watercare

16.     Three targets for Watercare’s 27 SOI measures were not met, relating to longer response times time for attendance at sewerage overflows, increase in average asset age and formal engagement with mana whenua.

17.     Watercare's programme to reduce water loss includes pressure management, leak management, repairs and renewals. The result of 11.4 per cent water loss was within the target limit of 13 per cent.

18.     Watercare and council's Healthy Waters team are working closely together to respond to the Three Waters Reform programme.

19.     Capital delivery was 91 per cent of budget at year end which was a good result given COVID-19 impacts on construction sites.

20.     Operational revenue was higher than budgeted, due to higher than anticipated revenue from development. Operational expenditure was also over budget.

Ports of Auckland Limited

21.     POAL’s FY22 financial results reflect the challenges of FY22 including the impacts of COVID-19 and Auckland’s lockdowns, significant disruption to the global supply chain and the decisions by the POAL Board to refocus the business. The net loss after tax of $10.275 million (2021 - profit $45.574 million) reflects the cancellation of the project to partially automate the Fergusson Container Terminal which resulted in a write-off of $63.074 million.

 

 

22.     Despite the challenges of FY22, POAL maintained their container terminal performance and continued to operate the multi-cargo terminal well, with continually high freight volumes. During the 12 months to 30 June 2022, POAL's revenue increased 17.2 per cent due to good volume and storage revenues.  POAL paid an improved dividend for the 2021/2022 year off the back of improved revenue and strong cost control.

Ngā tūtohunga

Recommendation/s

That the Council Controlled Organisation Oversight Committee:

a)      receive the 2021/2022 fourth quarter reports of the substantive Council-Controlled Organisations, provided as attachments A to E of the agenda report

b)      receive the 2021/2022 annual report of Ports of Auckland Limited and the 2021/2022 full year results for the key performance indicators in the 2021-2024 Statement of Corporate Intent provided as attachments F and G of the agenda report.

 

Horopaki

Context

23.     Each substantive CCO must provide a quarterly report to the CCO Oversight Committee. They are required to:

·     summarise the CCO’s performance against the approved budget and agreed targets in the 10-year Budget and SOI

·     provide a forecast of the CCO’s performance

·     identify the cause of major variances

·     highlight major achievements for the quarter

·     signal any potential or developing issues.

24.     The reports for the fourth quarter of 2021/2022 are contained in attachments A to E.

25.     Under the MOU between POAL and the council, POAL is required to provide annual reports to council on the matters and within the timeframes specified in the Port Companies Act 1988.

Tātaritanga me ngā tohutohu

Analysis and advice

Auckland Transport

Financial performance

26.     For the full year, AT’s net operating result including depreciation is $8 million unfavourable to budget, where the unfavourable operating revenue variance has been largely minimised through cost reductions and cost deferrals. This deficit is within the additional $50 million of operating funding approved by the Finance and Performance Committee in December 2021.

27.     Operating revenue is unfavourable to budget by $119 million driven by lower-than-expected public transport patronage level for the year. Public transport patronage begun to recover in April following the Omicron outbreak and continued to increase to 59 per cent of pre-COVID-19 levels in June, however this recovery is below the budget assumption of 87 per cent. April to June monthly public transport income reflects the 50 per cent discount in fares recovered from passengers. Parking and enforcement revenue is also unfavourable to budget due to lower occupancy and infringement ticket issuances as a result of continued COVID-19 impacts.

28.     Operating expenditure is below budget by $112 million mainly due to lower public transport contract costs, unplanned facilities maintenance, AT delivered events and training, and advertising costs.

29.     Capital delivery is $656 million against a budget of $820 million (80 per cent). Programmes and projects across the board are behind planned spend, mainly driven by the impacts of COVID-19.

Non-financial performance and other issues

30.     AT has a total of 28 measures, 14 of which are also 10-year Budget measures.  For this financial year, 18 performance measures have met or exceeded targets, nine were below target, and one measure did not have a target for 2021/22. 

31.     Safety targets continue to be challenging, with the expected reductions in DSI not being met. The report provides additional information about the January to June 2022 period for the local road, wider network, and vulnerable user measures, along commentary which explains patterns occurring across a calendar year (typically DSI are worst in the first five months, and also December).  The overall long-term DSI trend continues to decline against the 2017 baseline, but not as fast as targeted in the current year for the overall road network and for vulnerable users.

32.     Delivery on programmes to upgrade intersections and corridors is however progressing well, with some major upgrades being delivered across eight intersections (target seven). AT will continue to work with other partners to achieve the rate of improvement in safety that is sought.

33.     Public transport recovery continues to be impacted by COVID-19.  Overall the result was 50 per cent of the target, though May and June 2022 had the highest patronage since the August 2021 lockdown, which is still affecting the 12-month figures. Similar results are experienced in specific categories such as rail or rapid network boardings.  Leaving aside lockdowns, a range of factors are contributing to the slow recovery, including changes in travel patterns, as well as issues such as the bus driver shortage and absenteeism for sickness through the Omicron period. 

34.     A positive result was in delivery of cycleways, which exceeded the trajectory to the three-year target. While cycle movements past the 26 selected count sites did not meet the target, it was around 81 per cent of the target – much less affected by COVID-19 than public transport targets. It will be interesting to see how this measure improves over the next few reporting periods, as the impact of the 2021 lockdowns is removed from the figures, and with the improved facilities being taken up by people on bikes. 

35.     Road productivity (number of people moved, and freight network at a defined level of service) were targets that were both met.  AT does caution that congestion appears to be back to pre-COVID-19 levels, and it will monitor how this is tracking.

36.     Finally, AT’s corporate emissions reduced by 27 per cent (target six per cent). This large decrease is partly the result of reduction in use of facilities because of lockdown and such a large decrease is not expected again.  It is however a positive result, especially if it can be sustained in the future. 

Issues / risks

37.     Issues and risks largely reflect the trends in the performance measures and financial performance.  AT has noted and remains very concerned about the DSI trends, public transport recovery, and impact of COVID-19 and inflation on programme delivery and renewals.  In addition, it notes that implementation of the Transport Emissions Reduction Pathway will require significant behavioural changes for Aucklanders, with significant stakeholder management challenges. 

Eke Panuku

Financial performance

38.     Direct revenue is $3.3 million favourable to budget, even after $1.6 million in COVID-19 relief has been credited to tenants. This is largely due to additional revenue generated by commercial properties held in the portfolio longer and back dated rent reviews.

39.     Direct expenditure is $1.3 million favourable compared to budget due to savings primarily made on insurance costs and professional services, which are partly offset by higher than expected spend on regeneration activities in placemaking and initial investigations on capital projects.

40.     Capital expenditure is $41.1 million against a budget of $86.9 million, or 47.3 per cent of delivery against budget. This is materially lower compared to Eke Panuku’s capex delivery seen in the past couple of financial years (around 80 per cent for both 2019/2020 and 2020/2021) and compared to the rest of the group (79 per cent delivery of capital investment against budget of $2.9 billion in 2021/2022)

41.     Eke Panuku noted the underspend is due to a range of factors including delays associated with interdependent projects such as Northern Pathway project. With impact of COVID-19 restrictions in the first half of the year on staff, contractors and suppliers, projects were affected by delayed design, consenting and tenants and stakeholder’s decisions in making property available for physical works. Planned site acquisitions were also affected by Public Works Act requirements and third-party agreements.

Non-financial performance and other issues

42.       Eke Panuku have met nine of their 11 performance measure targets for 2021/2022, based on unaudited results. This includes 358 net new dwelling units completed (against a target of 350) and 23,065 square meters of public realm works completed (against a target of 21,000 square meters). In addition, the net operating budget and occupancy targets for the property portfolio were achieved, with the net operating budget contributing to council group funding.

43.     The two targets that were not met were:

·     Achieve asset recycling target agreed with Auckland Council - $35 million of asset sales were completed, against a target of $115 million. This result was due to a recent decline in the property market.

·     Complaints resolved within 10 working days – 34 per cent of complaints were resolved in 10 working days, against a target of 80 per cent. The total number of complaints was 38 and of these, 13 were resolved within 10 working days. Eke Panuku advise that a number of the complaints were related to one project which took longer than 10 days to resolve, significantly affecting the overall result. This is a new performance measure and further work on the process and methodology will be undertaken.

44.     Eke Panuku met the performance measure on completion of capital project milestones approved by the Eke Panuku board (81 per cent against a target of 80 per cent). However as noted above, overall capex delivery was lower than budgeted.

45.     Key highlights for the quarter:

·     A new investment partnership with NZ Super Fund. The partnership will be focused on development opportunities in the priority locations such as Northcote and Panmure.

·     Manukau – the Te Whakaoranga o Te Puhinui – Puhinui Regeneration charter signed by key project partners. The charter sets out actions and a roadmap to restore the environment of Te Puhinui, the result of three years collaboration.

·     Takapuna central – agreement signed with Willis Bond to build a mixed-use development over five sites surrounding Waiwharariki Anzac Square. Stage 1 of the square has commenced and is due to be completed this financial year.  

·     Avondale central – agreement with Marutūāhu-Ockham Group to develop 1.58ha of land in central Avondale, a significant milestone for this centre. The partnership plans to build 750 apartments with a minimum six Homestar rating.

·     Avondale Crayford Street West upgrade – a project to strengthen the connection between the Avondale town centre, including future community centre, and the train station was completed in late June 2022.

Issues / risks

46.     Eke Panuku have noted the deterioration of the property market including lower confidence from the private sector on land sales. This is due to significant inflation costs for construction, increasing interest rates and weaker purchaser interest in the residential product given concerns over housing prices and availability of credit. A weakened property market impacts Eke Panuku property sale targets.

47.     Other risks include material supply, delays with statutory planning processes and staff availability. Eke Panuku note they have had to adjust their timelines to accommodate frequently changing situations.

48.     The Human Rights Review Tribunal hearing in relation to the former Tavern Lane site development in Papatoetoe between Auckland Council/Eke Panuku and Ngai Tai Waipareira Housing concluded in June 2022.  The Tribunal findings are yet to be released.

Tātaki Auckland Unlimited

Financial performance

49.     Tātaki Auckland Unlimited had a net direct expenditure of $112.6 million for the year, which is slightly favourable to budget. This favourable variance is due to changes in the timing of planned expenditure in response to the COVID-19 driven adverse revenue results and uncertainties regarding future revenues.

50.     Direct revenue is $29.1 million favourable to budget due to unbudgeted Activate and Reactivate Tāmaki Makaurau grant funding and wage subsidy receipts, offset by a reduction in visitor and event revenues resulting from the COVID-19 restrictions.

51.     Direct expenditure is $28.3 million unfavourable to budget, which is due to the corresponding unbudgeted Activate and Reactivate Tāmaki Makaurau expenditure, offset by changes in programme timing as a result of trans-Tasman border restrictions and resurgence of COVID-19 domestically.

52.     Capital spend is $42.8 million against a budget of $56.7 million (75.5 per cent). The slowdown in delivery as noted by Tātaki Auckland Unlimited is due to range of factors including the COVID-19 restrictions on capital works under alert level four, operational constraints impacting under level three as well as ongoing supply chain issues. The underspend has largely been deferred into the financial year 2022/2023.

Non-financial performance and other issues

53.     Tātaki Auckland Unlimited has 11 SOI measures, of which seven are 10-year Budget measures. Nine of the 11 measures are tracked quarterly. One is a six-monthly measure and one is an annual measure. At the end of quarter four, six performance measures were achieved, one was substantially achieved, one was not achieved (but progress made on last year), and three were not achieved.

54.     The four performance measures (which are also 10-year Budget measures) that did not meet their targets were as follows:

·     The number of people who are issued tickets to attend Auckland Live, Auckland Zoo, Auckland Art Gallery, NZ Maritime Museum, and Auckland Stadiums venues and events. Target was 1.44m, result was 732,285.

·     The percentage of operating expenses funded through non-rates revenues (LTP measure).  Target was 44 per cent, result was 33 per cent.

·     The contribution to regional GDP from major events and business events attracted or supported. Target was $34 million, result was $30.2 million.

·     Carbon emission reductions (year-on-year percentage change).  Target was zero per cent, result was four per cent.

55.     For those performance measures where the target was not achieved, this can largely be attributed to impacts from COVID-19, including the closure of Tātaki Auckland Unlimited facilities for periods in quarters one and two, audience/visitor limitations in quarter three and multiple event cancellations and postponements.

56.     Highlights for the fourth quarter include:

•       On 13 May 2022, Auckland Unlimited officially launched its new bilingual name, Tātaki Auckland Unlimited.

•       The Auckland's Future, Now event was held on 24 May with about 200 delegates attending in person and 360 online.

•       Excellent progress was made during the quarter on the major expansion of Auckland Film Studios.

•       The newest member of the Innovation Precincts network, Reserve Tāmaki was launched in June.

•       The New Zealand Warriors home-coming match was the first sold-out stadium event at Mt Smart Stadium since early 2020.

Issues / risks

57.     Tātaki Auckland Unlimited has highlighted that Auckland’s reputation as a screen friendly city is at risk as it becomes increasingly difficult for location shoots to take place due to permit regulations on sites of significance to mana whenua.

58.       While New Zealand’s borders have re-opened, the key limiting factor on the return of visitation to Tāmaki Makaurau is airline capacity.  High freight costs and slow ticket buying behaviour represent significant threats to the summer concert season.

Watercare

Financial performance

59.     Watercare’s net direct revenue is $525.8 million, $69.4 million favourable to the full-year budget. The favourable variance primarily came from better than anticipated revenue performance that more than offset the higher costs.

60.     Direct revenue is $152.6 million better than budget, driven by a material increase in infrastructure growth charges revenue ($125.8 million) due to strong developer activity during the financial year.  

61.     Direct expenditure is unfavourable to budget by $83.3 million due to COVID-19-19 contracts payments expensed, increased maintenance and employee costs (including increased leave balances and FTE, overtime and lower labour recoveries as a result of lower capital delivery).

62.     Capital delivery is $679.7 million (91 per cent) against a budget of $746.6 million. The delivery has been impacted by COVID-19 alert level 4 restrictions, which saw the closure of most construction sites.

Performance measures and other issues

63.     Watercare has a total of 27 SOI measures, including 14 that are also measures in the 10-year Budget. Of these, three targets were not met:

·     Response time for attendance at sewerage overflows (63 minutes year-to-date median compared with a target of less than 60 minutes).

·     Reduction in average asset age (increased from 39.5 years value weighted in 2020/2021 to 40 years in 2021/2022).

·     Formal engagement with mana whenua (hui were held with 18 of 19 iwi and while the 100 per cent target was not met this was a good result given COVID-19 restrictions).

64.     Real water loss from the reticulated system was reported after several quarterly reports where data was not available. The result of 11.4 per cent water loss was within the target limit of 13 per cent. Watercare's programme to reduce water loss includes pressure management, leak management, repairs and renewals. 

65.     A revised approach for the Western Isthmus Water Quality Improvement Programme will extend the Central Interceptor tunnel to Point Erin to reduce wet weather wastewater overflows in the area.

66.     An agreement was also reached in the quarter on the impacts of COVID-19 on the Central Interceptor project which included an additional 100 days to the overall contract completion. Watercare highlight availability and retention of personnel and inflationary pressures as major ongoing risks for the project.

67.     Watercare is progressing investigations on the Mangakura Dam to address deficiencies in the lower spillway identified in the annual summary of dam performance.

68.     Work continues towards identifying actions required to meet the new Drinking Water rules and regulations issued by Taumata Arowai which come into effect in November 2022.  Compliance is required by January 2023.  Revised Water Safety Plans are also being developed for submission to Taumata Arowai.

69.     Watercare and council's Healthy Waters team are working closely together to respond to the Three Waters Reform programme. Operational collaboration also continues with the northern councils that will form the new Entity A. 

Ports of Auckland Limited

Financial performance

70.     POAL revenue is $265.3 million, up by 17.2 per cent from the previous year ($226.3 million) driven by a strong performance from the Multi-Cargo and the breakbulk business.

71.     The underlying net deficit after tax is $10.3 million, which is unfavourable to a net profit after tax budget of $21 million. This is primarily due to the impairment of the Fergusson Container Terminal automation project ($63.1 million, approximately $53 million relates to software write-offs). POAL note the operating profit before tax, excluding impairments, revaluations and share in investments for this year grew to $27.4 million, an increase of 32.8 per cent compared to the result of $20.7 million from the last financial year.

72.     Capital expenditure is $33.2 million, behind the planned $67 million (49.6 per cent of delivery), mainly as a result of restrictions on capital works during the COVID-19 alert level 4 lockdown.

73.     POAL have declared a final dividend of 8.25 cents per share, to give a total dividend for the year of 9.7 cents per share. This means a total dividend payment of $14.2 million for the year, higher than the budget of $2.1 million and last year’s dividend of $3.7 million.

Non-financial performance

74.     POAL note in their annual report that despite the supply chain challenges of FY22 container supply chain volumes showed a slight decline overall, with total TEUs down 0.8 per cent to 811,565 compared to 818,238 last year.

75.     The Multi-Cargo business unit has continued to perform well, and volumes have increased. The car trade has proven resilient, with volumes up 1.8 per cent to 240,544 units, compared to 236,260 units last year. Total breakbulk volume (including cars) increased by 9.4 per cent this year to 7.293 million tonnes, compared to 6.666 million tonnes last year.

SCI performance measure results

76.     Attachment G provides POAL’s full year results for the key performance indicators against the annual targets in the 2021-2024 SCI. A summary is provided below.

Health and Safety

77.     Two lost time injuries (LTI) were recorded in the final quarter resulting in 15 for the full year compared to 17 last year for a 12 per cent reduction. This is below the target of 50 per cent reduction.

78.     POAL report zero fatalities or serious work-related illnesses or injuries in the year. Wallace Investments Limited, an independent stevedoring company had a fatality at the Port in April 2022.

79.     Thirty-eight of the 45 CHASNZ recommendations have been completed.  Recommendations in two areas, fatigue management and training, have commenced but require longer to implement. They remain a top priority for completion in FY23.

Productivity

80.     Crane rate (as measured by Ministry of Transport) was 24.1 for the year against an annual target of 25.  Crane rate is the number of containers a crane lifts on and off a container ship in an hour.  Ship rate (measured by Ministry of Transport) was 43.3 for the year against an annual target of 62.5.  Ship rate is the number of containers moved on and off a container ship in an hour.

81.     Truck turnaround time (percentage turned at less than 60 minutes) was 97.5 per cent meeting the annual target of 80 per cent. Average truck turnaround time was 23.45 minutes against an annual target of 38 minutes.

82.     The multi-cargo terminal average car dwell time for the year met the annual target of 2.85 days with a result of 2.07 days.

Sustainability

83.     POAL emissions fell 8.3 per cent to 11,464.8 tC02-e this year (unaudited) from 12,502 tC02-e the previous year. This is a 19.3 per cent emission reduction against 2017 baseline. The decrease was due to purchase of Renewable Energy Certificates and less diesel consumed from container handling equipment and vessels due to lower container throughput.

84.     Zero harbour spills caused by POAL were reported.

85.     Percentage of landside moves on rail was 14 per cent meeting the target of 14 per cent.

Issues / risks

86.     Under new leadership POAL has started to recover their position and build the foundation for their future as a safe and profitable customer-focused organisation that provides an improving return to the council.  The return of cruise ships will be good for the business going into FY23.

87.     While the year ahead looks promising, external challenges remain.  The world supply chain is still disrupted, and it is expected that disruption will continue for some time.

Tauākī whakaaweawe āhuarangi

Climate impact statement

88.     The quarterly performance reports are a key tool to monitor the progress of each CCO in action on climate change.  The CCOs quarterly reports contain commentary on activities relating to climate change.  Aspects of note are discussed below.

89.     AT’s corporate emissions have reduced by 27 per cent, as is noted earlier in this report. A number of other initiatives are noted on the dedicated ‘climate change’ page of the quarterly report, but the most significant is AT’s support for the (now signed off) Transport Emissions Reduction Pathway. An implementation plan will be developed in the first part of the 2022/23 year.

90.     Eke Panuku continue to implement their Climate Change Strategy 2020/2021. Actions in the quarter include:

·     Releasing the Downtown Car Park Request for Development Proposal with minimum rating ambitions of Green Star 5 and Homestar 8. This request included sustainable procurement objectives for carbon emissions, local supplier utilisation, quality employment, supplier diversity and waste minimization.

·     Future fit has been launched with staff to promote understanding and reduction of carbon footprints.

91.    Among its many climate response activities, Tātaki Auckland Unlimited continues to input to council’s climate disclosure working group. This quarter included providing feedback on the XRB consultation for NZ CS 1, climate scenario development, and a pilot workshop for identifying transition risks.  Tātaki Auckland Unlimited is working on phase one of an emissions reduction pathway, an adaptation plan, and the completion of sustainability strategy scoping.

92.     A joint Watercare and Healthy Waters Climate Action Plan has been completed to deliver on the actions and targets from Te Tāruke-ā-Tāwhiri: Auckland's Climate Plan. The plan was presented to the Environment and Climate Change Committee in July 2022. 

93.     Watercare has updated its integrated source management model (ISMM) which supports operational decision making for water supply and long-term planning. The ISMM now includes recent weather data and climate change projections.

94.     POAL emissions fell 8.3 per cent to 11,464.8 tC02-e this year (unaudited) from 12,502 tC02-e the previous year. This is a 19.3 per cent emission reduction against 2017 baseline. The decrease was due to purchase of Renewable Energy Certificates and less diesel consumed from container handling equipment and vessels due to lower container throughput.

95.     POAL have also announced a commitment to establishing genuine harbour health through ongoing initiatives in the Waitematā Harbour.

Ngā whakaaweawe me ngā tirohanga a te rōpū Kaunihera

Council group impacts and views

96.     Each CCOs quarterly report contains information on how they are contributing to the council’s outcomes and objectives.

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

Local impacts and local board views

97.     The governance of substantive CCOs is a responsibility delegated to the CCO Oversight Committee.  The views of local boards have not been sought. CCOs provide six-monthly progress and performance reports to local boards. The quarterly reports also provide a summary of the engagement that CCOs have carried out with local boards during the quarter.

Tauākī whakaaweawe Māori

Māori impact statement

98.     Each CCO reports on their contribution towards achieving Māori Outcomes in their quarterly report. Aspects of note are discussed below.

99.     AT’s report notes a wide range of engagements with mana whenua, alongside actions as part of the marae safety programme, delivering te reo on the transport network, and various internal activities to build the Māori cultural capability of AT’s staff. 

100.   Eke Panuku highlights for the quarter include:

·     A Māori member appointment to the Technical Advisory Group (TAG) that reviews all design work within the Eke Panuku portfolio.

·     Mana whenua engagement on art works in Onehunga and the Sealink Ferry Terminal building.

·     Establishment of an iwi development fund to support mana whenua to access commercial opportunities. Mana whenua have also been involved in the refresh of the selecting development partners policy, with changes potentiality supporting mana whenua to bid on sites within the property portfolio.

101.   Eke Panuku have met the two relevant performance measures. Firstly 51 initiatives to support Māori outcomes have been completed (against a target of 45 initiatives). Secondly a baseline survey was undertaken on the support mana whenua receive from Eke Panuku, with 50 per cent mana whenua satisfaction. Internal sustainable procurement targets have been adopted for supporting Māori and Pasifika businesses.

102.   Under the Kia ora te Umanga (Māori Business, Tourism and Employment) priority of Kia ora Tamaki Makaurau, Tātaki Auckland Unlimited undertook additional analysis of its supplier diversity expenditure, which highlighted areas where Tātaki Auckland Unlimited is successfully achieving the five per cent supplier diversity target.  Among many other activities to support Māori outcomes, the team also provided advice to Kainga Ora on how to scale up Māori small to medium businesses for Kainga Ora contracts.

103.   For the last three years Tātaki Auckland Unlimited have consistently exceeded targets for two of their performance measures and as a result of shareholder feedback on their draft 2022-2025 SOI, Tātaki Auckland Unlimited have increased their targets for the current and following two financial years.  These two measures are 10-year Budget measures and are:

·     Net promoter score for Tātaki Auckland Unlimited’s audiences and participants. This was 20 and is now 40 for 2022/23, 45 for 2023/24 and 50 for 2024/25.

·     The number of programmes contributing to the visibility and presence of Māori in Tāmaki Makaurau. This was 20 and is now 40 for the next three years.

104.   Watercare is working to secure cadetship placements and education and job pathways for Māori into the water industry. This work supports Kia Ora te Rangatahi (Realising Rangatahi Potential) and Kia Ora te Umanga (Māori Business, Tourism and Employment). Planning continues for hui with Waikato River iwi and the Waikato River Authority, supporting Kia Ora te Taiao (Kaitiakitanga).

Ngā ritenga ā-pūtea

Financial implications

105.   Each of the CCO’s quarterly reports contain information regarding their financial performance.

Ngā raru tūpono me ngā whakamaurutanga

Risks and mitigations

106.   Each of the CCOs quarterly reports contain information regarding their key risks and issues.  Where these are particularly important to note, they are discussed above in the individual CCO sections. 

Ngā koringa ā-muri

Next steps

107.   This report is primarily for information purposes. The next quarterly reports (Quarter One, July to September 2022) will be provided to a relevant committee of the new council with appropriate delegation in late 2022.

Ngā tāpirihanga

Attachments

No.

Title

Page

a

Auckland Transport Chair cover letter to quarterly report

23

b

Auckland Transport Q4 report 2021/2022

25

c

Eke Panuku Q4 report 2021/2022

47

d

Tātaki Auckland Unlimited Q4 report 2021/2022

73

e

Watercare Q4 report 2021/2022

89

f

Ports of Auckland Limited 2021/2022 Annual Report

109

g

Ports of Auckland Limited full year results for key performance indicators in the 2021-2024 Statement of Corporate Intent

189

      

Ngā kaihaina

Signatories

Authors

Sarah Johnstone-Smith - Principal Advisor

Edward Siddle - Principal Advisor

Rachel Wilson - Principal Advisor

Trudi Fava - CCO Programme Lead

Chris Levet - Principal Advisor

Authoriser

Alastair Cameron - Manager - CCO Governance & External Partnerships

 

 


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20 September 2022

 

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Council-controlled Organisations accountability requirements exemptions

File No.: CP2022/12182

 

  

 

Te take mō te pūrongo

Purpose of the report

1.       To exempt a number of smaller council-controlled organisations (CCOs) from the accountability requirements of the Local Government Act 2002, in particular the statement of intent requirements.

Whakarāpopototanga matua

Executive summary

2.       The Local Government Act 2002 (LGA) provides for local authorities to exempt a CCO from the accountability requirements of the LGA (s7(3)), following an assessment of:

·     the nature and scope of the CCO’s activities

·     the costs and benefits of exempting to the local authority, the CCO and the community (s7(5)).

3.       Ten CCOs were exempted in 2019, with a review of these exemptions required by September 2022 (FIN/2019/92).

4.       Providing an exemption under section 7 of the Local Government Act has the effect of treating a CCO as though it were not a CCO, and therefore is not required to meet the various requirements of the Act for accountability and in particular, to provide council with a statement of intent. 

5.       A review of these CCOs and their exemptions has been undertaken by staff.

6.       An exemption is no longer required for Highbrook Park Trust, as this Trust no longer exists.

7.       Staff recommend a further exemption for the remaining entities, on the basis that there would be little benefit, if any, from applying the SOI accountability requirements. 

8.       Staff recommend that a new exemption is granted to WCS Limited, a subsidiary of Watercare.  We note that Watercare has advised it is in the process of disestablishing this entity, but this process is not yet complete. 

9.       on the grounds that the costs associated with meeting the Statement of Intent accountability requirements of the Local Government Act for these organisations outweigh the benefits.

Ngā tūtohunga

Recommendation/s

That the Council Controlled Organisation Oversight Committee:

a)      agree to grant council-controlled organisation exemptions under section 7(3) of the Local Government Act 2002 to the following organisations:

i)        Westhaven Marinas Limited

ii)       Westhaven (Existing Marina) Trust

iii)      Westhaven (Marina Extension) Trust

iv)      Auckland City Water Limited

v)      Watercare Harbour Clean-up Trust

vi)      WCS Limited

vii)     Mount Albert Grammar School Community Swimming Pool Trust

viii)    Te Taumata Toi-a-iwi / Arts Regional Trust

ix)      Te Motu a Hiaroa (Puketutu Island) Governance Trust

x)      ngere Mountain Education Trust

xi)      Te Puru Community Charitable Trust

b)      agree to review these exemptions by September 2025

c)      note that these exemptions can be revoked by the council at any time

d)      note that the Manager, CCO Governance and External Partnerships will advise the entities of the exemptions.

 

Horopaki

Context

10.     Section 7(3) of the LGA provides for local authorities to exempt a CCO from the accountability requirements associated with a CCO, following an assessment of the nature and scope of the CCO’s activities and the costs and benefits of exempting to the local authority, the CCO and the community.

11.     Under the LGA, the council can revoke an exemption at any time and must review it every three years.

12.     The intention of section 7(3) of the LGA is to avoid unnecessary compliance costs for small CCOs with limited scope of activities. For such entities, requiring an SOI and regular reporting against the performance measures contained in the SOI would add reporting that is disproportionate to the size and/or scale of the entity.

13.     CCOs with an exemption must be reviewed within three years, and exemption must be reconsidered each time.

14.     Despite the exemptions from accountability requirements through the SOI, council maintains a governance relationship with these entities through its board appointment responsibilities and receipt of financial reports for the Auckland Council group financial report. Both these processes allow council to have oversight, and the opportunity to identify issues that could affect the exemption status. Some of the CCOs also receive funding from council and performance is monitored through a funding agreement, rather than a SOI.

Tātaritanga me ngā tohutohu

Analysis and advice

15.     Ten CCOs were exempted in 2019, with a review required to be undertaken by September 2019 (FIN/2019/92). Staff have engaged with these CCOs and council departments to confirm that an exemption is still appropriate.

16.     We note that Highbrook Park Trust no longer exists (CCO/2021/19) and therefore no exemption is required.

17.     Staff recommend the further exemptions of the following entities, to be reviewed by September 2025:

·    Westhaven Marina Limited

·    Westhaven (Existing Marina) Trust

·    Westhaven (Extension) Trust

·    Auckland City Water Limited

·    Watercare Harbour Clean-up Trust

·    Mt Albert Grammar School Community Swimming Pool Trust

·    Arts Regional Trust / Te Taumata Toi-a-iwi

·    Mangere Mountain Education Trust

·    Te Motu a Hiaroa (Puketutu Island) Governance Trust

·    Te Puru Community Charitable Trust.

Marina companies and trusts

18.     In June 2019, the shares in Westhaven Marina Limited were transferred from Eke Panuku to Auckland Council, with Eke Panuku delegated management oversight of these subsidiaries.

19.     Westhaven Marina Limited is the sole corporate trustee of two subsidiary trusts - Westhaven (Existing Marina) Trust and Westhaven (Marina Extension) Trust, which manage the Westhaven marina assets and occupation rights. Westhaven Marina Limited has appointed Eke Panuku as manager of the Trusts to supervise, direct and control the management and operation of the marina.

20.     Staff recommend a further exemption for Westhaven Marina Limited, Westhaven (Existing Marina) Trust and Westhaven (Marina Extension) Trust on the basis that the scale and scope of the activities is limited and Westhaven Marina Limited does not hold assets or incur liabilities.

21.     From a practical perspective, Eke Panuku is responsible for the activity of these entities and the Eke Panuku SOI and performance reports address these activities.

Auckland City Water Limited (ACWL)

22.     ACWL is a subsidiary of Watercare. It was originally established by Metrowater Limited for the sole purposes of name protection. It transferred to Watercare in November 2010, along with other Metrowater’s assets. It remains a non-active company, with one director – currently the chair of Watercare.

23.     This report recommends a further exemption for ACWL as there is no activity to monitor and therefore no benefit from introducing an SOI accountability regime.

WCS Limited

24.     This company was registered on 20 February 2020.  It is 100 per cent owned by Watercare Services Limited, with one director, an executive of Watercare. It is a non-active company with no activity to monitor and therefore no benefit from introducing an SOI accountability regime.

25.     This is a new exemption given the company did not exist when exemptions were last considered by Council. 

26.     Watercare has advised it is in the process of disestablishing this entity, so this exemption is provided to avoid a situation where this process is not completed when statements of intent are next due. 

Watercare Harbour Clean-up Trust (WHCUT)

27.     Watercare Harbour Clean Up Trust was set up in December 2002 by several local authorities and is a charitable trust governed by the Charitable Trusts Act 1957 and registered under the Charities Act 2005.

28.     The primary activity of WHCUT is to oversee the removal of litter from Auckland’s Waitemata Harbour and inner gulf islands and promotes the concept of rubbish-free waterways.

29.     Watercare discontinued sponsorship of the WHCUT in 2020/21 and the trust is currently in abeyance/suspended and not operating.

30.     This report recommends an exemption for the WHCUT based on the limited scope and scale of its activities and that its activities are currently suspended. Formal reporting on SOI accountability requirements adds cost with little or no benefit.

Mt Albert Grammar School Community Swimming Pool Trust (MAGSCSPT)

31.     The MAGSCSPT was formed through a partnership between the Auckland City Council and the Mount Albert Grammar School. The MAGSCSPT have sub-licensed the entire facility to Auckland Council. As such, it is an asset owning trust, whose responsibilities are limited to maintaining and reporting financial accounts and receiving council reports related to the sub-licence agreement. On this basis, this report recommends an exemption for a further three years.

Te Taumata Toi-a-iwi / Arts Regional Trust (TTT)

32.     Auckland and Manukau City Councils formed TTT in 2001 to manage and grow their combined share of funds ($6 million) provided through the disestablishment of the Auckland Regional Services Trust. After annual inflation, TTT is charged with maintaining the capital sum and distributing its net income to Auckland’s art and cultural sectors. It receives no annual funding from Council. 

33.     TTT has sound governance practices and provides information to council when requested, particularly in relation to processes related to its board appointments. Requiring a SOI would be out of proportion to council’s interest and involvement in TTT and impose significant costs on a small entity with an unpaid volunteer board. On this basis, this report recommends a further exemption for TTT.

Māngere Mountain Education Trust (MMET)

34.     MMET operates an education center on Te Pane o Mataoho/ Māngere Mountain. The Trust was established in the 1990s. Trustees are appointed by Auckland Council (4) and Te Waiohua (2), and the Trust.  MMET has a funding agreement in place and this is approved by the Māngere-Ōtāhuhu Local Board.

35.     MMET’s performance measures are reported to the Māngere-Ōtāhuhu Local Board and provided to the CCO Governance and External Partnerships team.

36.     This report recommends an exemption to MMET based on the limited scope and scale of its activities. Formal reporting on SOI accountability requirements adds cost with little or no benefit, particularly as performance against the funding agreement is undertaken by the Māngere-Ōtāhuhu Local Board.

Te Motu a Hiaroa (Puketutu Island) Governance Trust

37.     The Puketutu Island Rehabilitation Project is Watercare Services Limited’s long-term programme to deposit biosolids in an excavated site on Puketutu Island. As part of establishing this programme, long-term governance structures were put in place to manage the rehabilitation of the island and facilitate conversion into a regional park.

38.     Three iwi entities hold the freehold title to Puketutu Island through a land-owning trust, Te Motu a Hiaroa (Puketutu Island) Charitable Trust.

39.     In June 2011, the Governing Body resolved its intent to manage Puketutu Island as a regional park. This resolution was with respect to a suite of governance and lease arrangements proposed by Watercare Services Limited in the process of settling appeals to resource consent application for biosolids disposal (the Puketutu Settlement).

40.     As part of this settlement process, a separate trust, Te Motu a Hiaroa (Puketutu Island) Governance Trust, was established to hold a trust fund for the development, management, maintenance and operation of Puketutu Island as public open space.

41.     The current exemption was on the basis that the governance trust does not hold any assets other than its income, and the scope of its activity is limited.

42.     This report recommends the exemption of the governance trust from accountability requirements because there would be little, if any, benefit for this entity or for the ratepayer, from applying the Statement of Intent accountability requirements of the Act. The recommendation also takes into account the compliance costs to the entity itself.  It also recognizes that long-term, the likelihood is that the Trust will cease to be a CCO. 

Te Puru Community Charitable Trust

43.     Te Puru’s financial accountability relationship with Council is primarily through a funding agreement monitored by Council’s Parks Department.  A close relationship is also maintained with Franklin Local Board, which has delegation to make appointments to Te Puru.  This report recommends the exemption of the Trust from accountability requirements because there would be little, if any, benefit for this entity or for the ratepayer, from applying the Statement of Intent accountability requirements of the Act.

Other non-substantive CCOs

44.     The following CCOs of Auckland Council will continue to provide statements of intent to Council: 

·    Contemporary Art Foundation

·    Community Education Trust Auckland (COMET)

·    Manukau Beautification Trust. 

Tauākī whakaaweawe āhuarangi

Climate impact statement

45.     This report does not impact on climate outcomes for Auckland Council as it is procedural. 

Ngā whakaaweawe me ngā tirohanga a te rōpū Kaunihera

Council group impacts and views

46.     Staff have engaged with relevant CCOs and departments of Council to determine whether an exemption is still appropriate, as part of developing this advice. 

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

Local impacts and local board views

47.     Local board views were not sought as decision-making on the governance of CCOs is a responsibility of the governing body of Auckland Council.  While these CCOs often operate at a local level and interact with local communities and local boards, the decisions sought in this report does not impact on these activities. 

Tauākī whakaaweawe Māori

Māori impact statement

48.     The exemptions proposed in this report have no particular impact on Māori.

Ngā ritenga ā-pūtea

Financial implications

49.     There are no financial implications arising from the proposed exemptions in this report.  As noted earlier, Council has other governance and accountability mechanisms other than statements of intent for monitoring the financial performance of these entities. 

50.     If exemptions were not granted, there may be increased compliance costs imposed on the CCOs and Council. 

Ngā raru tūpono me ngā whakamaurutanga

Risks and mitigations

51.     Granting an exemption may reduce the accountability for Council.  However, as noted above there are other governance and accountability mechanisms in place to mitigate this risk, and if exemptions were not granted, there is the risk that increased compliance costs would be imposed on the CCOs and Council. 

Ngā koringa ā-muri

Next steps

52.     If approved, the Manager, CCO Governance and External Partnerships will write to each of the council-controlled organisations notifying them of their exemption from preparing a statement of intent, and of the proposed exemption period. 

 

Ngā tāpirihanga

Attachments

There are no attachments for this report.    

Ngā kaihaina

Signatories

Author

Edward Siddle - Principal Advisor

Authoriser

Alastair Cameron - Manager - CCO Governance & External Partnerships

 

 


Council Controlled Organisation Oversight Committee

20 September 2022

 

Liaison councillors' updates

File No.: CP2022/06004

 

  

 

Te take mō te pūrongo

Purpose of the report

1.      To whiwhi / receive an update from liaison councillors to the boards of Council Controlled Organisations (CCOs). 

Whakarāpopototanga matua

Executive summary

2.       In February 2020, the Council Controlled Organisation Oversight Committee resolved to establish the role of a CCO liaison councillor (Resolution number CCO/2020/3).

3.       The key purpose of the liaison councillor role is to develop trusting relationships with the CCOs, to allow a better exchange of information. Liaison councillors can act as a key point of contact when specific issues arise, and provide advice when issues are likely to be of high public interest. They can provide the CCO with Governing Body perspectives which may help board decision-making, while at the same time being able to provide Governing Body colleagues with information about the rationale and detail of board decisions.

4.       Liaison councillors are required to regularly report verbally to the CCO Oversight Committee, or in writing if unavailable to attend in person, about activities undertaken in the role and issues arising.

5.       Liaison councillors are allocated to each CCO as follows:

·        Auckland Transport: Deputy Mayor Bill Cashmore and Cr Chris Darby

·        Auckland Unlimited: Cr Richard Hills and Cr John Watson

·        Eke Panuku Development Auckland: Cr Efeso Collins

·        Watercare: Cr Linda Cooper.

 

 

Ngā tūtohunga

Recommendation/s

That the Council Controlled Organisation Oversight Committee:

a)      whiwhi / receive the updates from liaison councillors to the Council Controlled Organisations. 

 

 

Ngā tāpirihanga

Attachments

There are no attachments for this report.     

Ngā kaihaina

Signatories

Author

Duncan Glasgow - Kaitohutohu Mana Whakahaere / Governance Advisor

Authoriser

Alastair Cameron - Manager - CCO Governance & External Partnerships

 

 


Council Controlled Organisation Oversight Committee

20 September 2022

 

Summary of Council Controlled Organisation Oversight Committee information memoranda and briefings (including the forward work programme) - 20 September 2022

File No.: CP2022/05999

 

  

 

Te take mō te pūrongo

Purpose of the report

1.       To tuhi ā-taipitopito / note the progress on the forward work programme appended as Attachment A.

2.       To whiwhi / receive a summary and provide a public record of memoranda or briefing papers that may have been held or been distributed to Council Controlled Organisation Oversight Committee members. 

Whakarāpopototanga matua

Executive summary

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

4.       The following memoranda and information items have been distributed:

Date

Subject

23/8/2022

Confidential report from 23 August 2022 Audit and Risk Committee: C1 CONFIDENTIAL: Council-Controlled Organisations'- Quarterly Risk Update August 2022.  Open resolution number AUD/2022/40

23/8/2022

Confidential report from 23 August 2022 Audit and Risk Committee: C2 CONFIDENTIAL: Ports of Auckland Limited Risk Update August 2022.  Open resolution number AUD/2022/41

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

 

Ngā tūtohunga

Recommendation/s

That the Council Controlled Organisation Oversight Committee:

a)      tuhi ā-taipitopito / note the progress on the forward work programme appended as Attachment A of the agenda report

b)      whiwhi / receive the Summary of Council Controlled Organisation Oversight Committee information memoranda and briefings – 20 September 2022.

 


 

 

Ngā tāpirihanga

Attachments

No.

Title

Page

a

Forward Work Programme

201

     

Ngā kaihaina

Signatories

Author

Duncan Glasgow - Kaitohutohu Mana Whakahaere / Governance Advisor

Authoriser

Alastair Cameron - Manager - CCO Governance & External Partnerships

 

 


Council Controlled Organisation Oversight Committee

20 September 2022

 

 

Kōmiti Aromātai Whakahaere Kaupapa Kei Raro I Te Maru O te Kaunihera / CCO Oversight Committee
Forward Work Programme 2022

This committee deals with the performance monitoring of CCOs and other entities in which the council has an equity interest. The committee are to have a general overview and insight into the strategy, direction and priorities of all CCOs, set policy relating to CCO governance and approve the CCO statements of intent.

The full terms of reference can be found here: Terms of Reference - Agreed 12 November 2019

 

Area of work and Lead Department

Reason for work

Committee role

(decision and/or direction)

Expected timeframes

Highlight the month(s) this is expected to come to committee in 2022

Jan

Feb

Mar

Apr

May

Jun

Jul

Aug

Sep

Oct

Nov

Dec

Quarterly, Half-Year and Annual Reports

CCO Governance and External Partnerships

Under the LGA and LGACA the council must regularly undertake performance monitoring of the CCO to evaluate its contribution to meeting its objectives, and the desired results identified in the SOI.

Receive quarterly reports, receive, and adopt half yearly and annual reports.  The CCOs will present to the CCO Oversight committee twice a year on their performance.

 

Progress to date:

Quarter Two reports received March 2022

Quarter Three reports received June 2022

 

 

 

 

 

 

 

 

 

 

 

 

 

Liaison Councillor Updates

CCO Governance and External Partnerships

Mayor Phil Goff has appointed a list of six CCO liaison councillors to attend the board meetings of the CCOs allocated to them, and report back to this committee. 

To receive updates from the CCO Liaison Councillors.

 

Progress to date:

Updates received March 2022, April 2022, June 2022, September 2022

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 


 


Completed

Area of Work

Committee Role

(decision and/or direction)

Decision

Quarterly, Half-Year and Annual Reports

Receive quarterly reports, receive and adopt half yearly and annual reports.  The CCOs will present to the CCO Oversight committee twice a year on their performance.

First quarter reports were received for substantive council-controlled organisations in December 2019, December 2020, and November 2021.

Second quarter reports received for substantive council-controlled organisations in March 2020, and March 2021.

Third quarter reports were scheduled for June 2020; however this meeting was cancelled due to COVID-19; received in May 2021.

Fourth quarter reports were received for substantive council-controlled organisations September 2020, and September 2021.

The Ports of Auckland Limited Interim Report for the six months ending 31 December 2020 were received in March 2021, annual report received in October 2021.

Annual reports for non-substantive CCOs received in October 2021.

Letters of Expectation

Seeking committee approval of the content of draft 2020/21 letters of expectation.

Decision to approve content of 2020/2021 letters of expectation, authority delegated to mayor to finalise and issue the letters, 12 December 2019.

(Link to decision CCO/2019/2)

CCO AGM Resolutions

To delegate the authority to Auckland Council’s chief executive to act as Auckland Council’s shareholder representative to execute a written resolution in lieu of an annual meeting. 

Decision to delegate authority to council’s chief executive to act as council’s shareholder representation to the substantive council-controlled organisations and also Tāmaki Regeneration Company and City Rail Link Limited and sign written resolutions
(Link to decision
CCO/2019/3)

Final SOIs

Seeking committee approval of final 2020/21 Statements of Intent from its substantive and non-substantive CCOs.

Decision to approve the 2020-2023 statements of intent, 22 September 2020.
(Link to decision
CCO/2020/10)

Haumaru Housing – End of year results

Haumaru Housing will report to CCO Oversight Committee once a year to discuss performance and end of year results.

Results presented in a workshop, 21 October 2020.

City Rail Link Limited (CRLL) – end of year results

CRLL reports quarterly as part of the group report to the Finance and Performance Committee. CRLL will present to the CCO Oversight Committee twice a year to discuss performance and end of year results.

Results presented in a workshop, 21 October 2020.

Tamaki Regeneration Company (TRC) - End of year results

TRC will report to CCO Oversight Committee once a year to discuss performance and end of year results.

Results presented in a workshop, 21 October 2020.

Merged Entity – new name

To approve the new name for the merged entity resulting from the amalgamation of RFAL and ATEED.

Decision to approve name of merged entity, 27 October 2020.
(Link to decision
CCO/2020/17)

Legacy CCO Review

To agree a set of criteria that will guide a review of Auckland Council’s legacy CCOs and the sequence of their review.

Decision to approve a review of the status of non-substantive CCOs and framework, 27 October 2020.
(Link to decision
CCO/2020/21)

Auckland Unlimited Final SOI

To approve a statement of intent for the new merged entity, Auckland Unlimited, resulting from the amalgamation covering the period 1 December 2020 to 30 June 2021.

Decision to approve a statement of intent for the new merged entity, Auckland Unlimited, 24 November 2020.
(Link to decision CCO/2020/27)

Ports of Auckland statement of corporate intent

To consider POAL’s final statement of corporate intent.

Draft statement of corporate intent received by the Governing Body, 27 August 2020.

Decision to approve POAL’s final statement of corporate intent 2020-2023, 8 December 2020. (Link to decision CCO/2020/33)

Te Puru Community Charitable Trust Organisation – extension of exemption

To approve Te Puru’s extension to the exemption from council-controlled organisation requirements under the Local Government Act 2002.

Decision to extend the Trust’s exemption, 23 February 2021.
(Link to decision
CCO/2021/5)

Draft SOIs

To approve proposed shareholder comments on substantive and non-substantive CCO draft 2021/2024 Statements of Intent.

Decision to note recommended comments, focus of the feedback and feedback received at committee, and agree the process of providing feedback to substantive and non-substantive CCOs, 21 May 2021.
(Link to decision CCO/2021/18)

Highbrook Park Trust - Review of Trust Deed and Management Contract

To disestablish the trust

Decision to disestablish the trust, 18 May 2021.
(Link to decision
CCO/2021/19)

Statement of Expectation

Approve the statement of expectations content and process.

Decision to approve the Statement of Expectations for substantive Council-controlled Organisations, agreed that the CCO Governance Manual is no longer required, 22 June 2021.
(Link to decision
CCO/2021/26)

Auckland Council Branding Guidelines

Approve new Auckland Council branding guidelines.

Decision to approve the updated Auckland Council group brand guidelines, require CCOs to comply with the updated guidelines, and note updates on compliance will be reported annually, 24 August 2021.
(Link to decision
CCO/2021/32)

Final SOIs

Approval of final 2020/24 Statements of Intent for substantive and non-substantive CCOs.

Decision to approve the 2021-2024 statements of intent for substantive and non-substantive CCOs
(Link to decision
CCO/2021/34)

Ports of Auckland statement of corporate intent

To consider POAL’s final statement of corporate intent.

Decision to receive Ports of Auckland Limited’s final Statement of Corporate Intent 2021-2024
(Link to decision
CCO/2021/46)

Haumaru Housing – End of year results

Haumaru Housing will report to CCO Oversight Committee once a year to discuss performance and end of year results.

Decision to receive annual reports in October 2021
(Link to decision
CCO/2021/47)

City Rail Link Limited (CRLL) – end of year results

CRLL reports quarterly as part of the group report to the Finance and Performance Committee. CRLL will present to the CCO Oversight Committee twice a year to discuss performance and end of year results.

Decision to receive annual reports in October 2021
(Link to decision
CCO/2021/47)

CCO ‘Scan the Horizon’ Workshops

The topics and sequencing of these workshops is being developed and will be agreed early in 2020.

Future of these workshops being considered as part of CCO Review.

Workshops were held as follows:

ATEED - February 2020

Auckland Transport - March 2020

Watercare - July 2020 (Governing Body workshop)

CCO site visits 2021

To implement CCO Review recommendation 27 - The governing body spends half a day each year visiting each CCO to better understand its business and culture and to informally build relationships.

Watercare site visit – 10 August 2021

Auckland Transport briefing in lieu of site visit due to Covid – 19 October 2021

Auckland Unlimited briefing in lieu of site visit due to Covid – 8 November 2021

Eke Panuku briefing in lieu of site visit due to Covid – 16 November 2021

CCO Review Updates 2021

To receive updates on the implementation and progression of the 64 summary recommendations of the CCO Review

A programme update was received in February 2020

The CCO Review was received by the Governing Body on 27 August 2020.

An update by way of memorandum was provided in November 2020.

An update was received in February 2021.

An update by way of memorandum was provided in March 2021.

Updates were received in May 2021, June 2021, August 2021, September 2021, October 2021 and November 2021

Liaison councillor updates 2021

To receive updates from the CCO Liaison Councillors.

Principals and draft protocols for the liaison councillor role were agreed in February 2020

Updates were provided in September, October and November 2020.

Updates were provided in May, June, August , September, October , November and December 2021.

Letters of Expectation

Seeking committee approval of the content of draft 2021/22 letters of expectation.

Decision to approve content of 2021/2022 letters of expectation, authority delegated to mayor and deputy mayor to finalise and issue the letters, 14 December 2021.
(Link to decision
CCO/2021/62)

CCO Review Updates 2022

To receive updates on the implementation and progression of the 64 summary recommendations of the CCO Review.

Committee received an overview of the implementation programme and noted that the Group Chief Executives Forum will continue to monitor implementation of outstanding review recommendations.

(Link to decision CCO/2022/14)

CCO site visits 2022

To implement CCO Review recommendation 27 - The governing body spends half a day each year visiting each CCO to better understand its business and culture and to informally build relationships.

Site visits took place on the following dates:

Auckland Unlimited – 10 May 2022.

Watercare – 10 June 2022.

Auckland Transport – 17 June 2022.

Ports of Auckland – 4 July 2022.

Eke Panuku – 5 July 2022.

Joint operating model for Auckland stadiums

The recommendations from the CCO Review report were received by the Governing Body on 27 August 2020 (Resolution number: GB/2020/89).

Recommendation 2 was that “the merged entity explores, at the council’s direction, the critical need for joint management and operation of the city’s four stadiums with the Eden Park Trust.”

 

Confidential report provided on 10 June 2022.

Next steps to be brought to new council.

(Link to decision CCO/2022/25)

Draft and Final SOIs

To approve final Statements of Intent for substantive and non-substantive CCOs.

Covers: AT, Watercare, Auckland Unlimited, Eke Panuku, Manukau Beautification Charitable Trust, COMET Auckland and Contemporary Art Foundation.

Committee approved final Statements of Intent for substantive and non-substantive CCOs.

(Link to decision CCO/2022/29)

Ports of Auckland - Statement of Corporate Intent

 

Under legislation Ports of Auckland Limited must deliver annually a statement of corporate intent not later than 1 month after the commencement of each financial year.

Committee approved draft shareholder comments on Ports of Auckland Limited Statement of Corporate Intent.

(Link to decision CCO/2022/30)

Seeking approval of final 2022/25 Ports of Auckland Limited Statement of Corporate intent from new council.