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Transport and
Infrastructure Committee
01 December
2022
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Auckland Transport's Quarter One Performance
Report 2022-2023
File No.: CP2022/16106
Te take mō te
pūrongo
Purpose of the report
1. To
receive a high-level summary of Auckland Transport
(AT)’s first quarter report (the period 1 July 2022 to 30 September
2022).
Whakarāpopototanga matua
Executive summary
2. Under
Auckland Council’s accountability framework, each substantive CCO must
provide a quarterly report to the relevant committee. Auckland
Transport’s report for the first quarter of 2022/2023 is contained in
Attachments A (cover letter) and B (report). The first quarter report provides
measures against the 2021-2031 10-year Budget and the 2022-2025 Statements of
Intent (SOI).
3. There
has been a welcome recovery in public transport patronage in the first quarter,
to around 67 per cent of pre-Covid levels. While this is positive, there are
well-recognised ongoing issues with service disruptions caused by the bus
driver shortage and rail infrastructure problems. These (and upcoming further
rail disruptions) mean that the ongoing recovery in patronage will remain
challenging.
4. There
have also been ongoing improvements in the numbers of deaths and serious
injuries, across the local road network, the wider network, and for vulnerable
users. However, in all three of these measures, the improvement is not to the
level sought in the agreed targets with council. Safety is a complex area, and
the report notes that there are community concerns emerging about how safety
measures (including speed limit changes and things like raised platforms) may
impact on travel time and congestion.
5. While
capital delivery is lower than budget, it is consistent with performance at the
same time in the previous year. This reflects ongoing impacts of COVID-19 on
supply chains, staffing, and cost escalations. Nonetheless, AT is delivering on
a significant number of projects and the report provides a good snapshot of the
sheer variety of works being undertaken at present.
6. One
aspect of the quarterly report which could be improved over time is the clarity
of some of the performance measures and the level of detail and explanation
provided. The performance ‘story’ for the quarter could be clearer.
The CCO Governance team is currently leading a process to consider appropriate
performance measures across all the council-controlled organisations, and it is
likely the quarterly reporting template will be reviewed in response. These
things will be undertaken in cooperation with councillors and Auckland
Transport, and with the aim of improving how measures and performance are
presented, and to reflect the priorities of the new Council.
Ngā tūtohunga
Recommendation/s
That the Transport and
Infrastructure Committee:
a) whiwhi /
receive Auckland Transport’s
2022/2023 first quarter report (Attachments A and B).
Horopaki
Context
7. Each
substantive CCO must provide a quarterly report to the relevant 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.
8. Auckland
Transport’s report for the first quarter of 2021/2022 is contained in
attachments A and B.
Tātaritanga me ngā
tohutohu
Analysis and advice
Financial performance
9. Auckland Transport’s financial performance is summarised on
the second page of its report.
10. Net operating result including depreciation is $22 million
unfavourable to the budget year-to-date (YTD). The unfavourable variance to
budget is primarily due to higher than budgeted depreciation costs following
the roading assets revaluation in June 2022.
11. Operating revenue is $2 million ahead of budget largely due to the
drivers below:
· the unbudgeted
top-up for public transport (PT) funding shortfall of $14 million from Waka
Kotahi, which is relating to the last financial year
· parking and enforcement
revenue $7 million lower than planned due to lower infringement ticket
issuances and parking occupancy
· PT income $3 million
lower than planned with patronage level sitting at 67 per cent of pre COVID-19
levels in September
12. Operating expenditure is higher than budget driven by the materially
higher depreciation costs. Full year impact of the revaluation on AT’s
depreciation budget is estimated to be around $100 million.
13. Capital expenditure delivery is $132 million against the YTD budget
of $202 million (65 per cent of delivery). Correspondingly, Waka Kotahi capital
expenditure co-funding is $33 million lower than budget, due to the lower
capital spend of AT and funding constraints experienced by Waka Kotahi.
Non-financial performance and other issues
14. AT has a
total of 31 measures, 16 of which are also 10-year Budget measures. In the
first quarter, for those that are able to be measured at this point in the
year, 7 performance measures are on track to meet or exceed their targets, and
8 are below target.
15. One of the
new targets introduced this financial year is the percentage of formal
complaints resolved within 20 working days. This was put in place for all CCOs
following the CCO Review. In quarter one, only 72 per cent of complaints had
been resolved, as against a target of 85 per cent. It will be important to
continue monitoring this measure, as it is an important contributor to the
reputation of Auckland Transport for members of the public in their
interactions with the organisation.
16. There has
been a welcome recovery in public transport patronage in the quarter, to around
67 per cent of pre-Covid levels. Total boardings were 4.8 per cent above the
trajectory required to meet the annual target, while rail patronage was 3.2 per
cent above the trajectory. While this is positive, there are
well-recognised ongoing issues with service disruptions caused by the bus
driver shortage and rail infrastructure problems. These (and upcoming further
rail disruptions) mean that the ongoing recovery in patronage will remain
challenging.
17. The number of
cycle movements are not on track to meet the target. The 12-month rolling count
was 18 per cent lower than required, which AT puts down to lower overall travel
demand and more working from home.
18. There have
also been ongoing improvements in the numbers of deaths and serious injuries,
across the local road network, the wider network, and for vulnerable users.
However, in all three of these measures, the improvement is not to the level
sought in the agreed targets with council.
19. Interpreting
the report’s measures and commentary for safety can be difficult for a
lay reader to understand without referring back to the Statement of Intent. In
each case, the measures span the calendar year (unlike many others) and the
quarterly report provides a cumulative measure up to the end of the reporting
period (so for quarter one, AT provides 9 months of data). Staff will work with
Auckland Transport to investigate how these measures can be expressed more
simply, without reducing the integrity of the information.
20. On a more
substantive issue, safety is a complex area and the report notes that there are
community concerns emerging about how safety measures (including speed limit
changes and things like raised platforms) may impact on travel time and
congestion. Safety on the Auckland network is a legislative imperative for
Auckland Transport, and the programme being pursued by AT has been estimated to
have significant benefits when taking into account the lost lives and
life-changing injuries that are avoided by improved safety.
21. While capital
delivery is lower than budget, it is consistent with performance at the same
time in the previous year. This reflects ongoing impacts of COVID-19 on supply
chains, staffing, and cost escalations. Nonetheless, at any one-time AT is
delivering on a significant number of projects and the report provides a good
snapshot the sheer variety of different works which are being undertaken at
present. In addition, the report provides an excellent view of the plans in
place for upcoming quarters, with a significant number of programmes outlined
(whether infrastructure on the ground, education programmes, technology
upgrades or customer experience improvements).
22. As noted in
the executive summary, staff will be looking at the quarterly reporting
templates of all of the CCOs, with a view to making it both simpler and more
approachable for both councillors and the public. Through discussions with the
new Transport and Infrastructure Committee led by Councillor John Watson, staff
will ensure that the discussion of ‘other focus areas’ in the
report reflects the concerns and priorities of the newly elected Council.
Tauākī whakaaweawe
āhuarangi
Climate impact statement
23. The quarterly performance reports are a key tool to monitor the
progress of each CCO in action on climate change. AT’s quarterly
reports contain commentary on activities relating to climate change (page 10 of
its report). Aspects of note are discussed below.
24. AT is beginning to investigate how to integrate the Transport
Emissions Reduction Pathway (TERP) into its programme. It is important to note
that the TERP is not simply driven by the pathway agreed by the previous
Council, but also by national level emissions reduction plans put in place by
central government.
25. AT’s organisational emissions are measured annually by a
third-party (Toitu). The report notes the emissions for last year but new data
for this quarter is not yet available. AT notes that the improvement of
last year will become more challenging to sustain in the current financial
year.
Ngā whakaaweawe me
ngā tirohanga a te rōpū Kaunihera
Council group impacts and views
26. Each CCOs quarterly report contains information on how they are
contributing to the council’s outcomes and objectives. For Auckland
Transport, a key element of this is in the section ‘Enabling and
supporting Auckland’s growth’. Many of these projects are
about working with other council and Crown organisations to deliver housing
projects, or to make ongoing improvements to capacity or amenity in specific
areas (such as the city centre).
Ngā whakaaweawe
ā-rohe me ngā tirohanga a te poari ā-rohe
Local impacts and local board views
27. The
governance of substantive CCOs is a responsibility delegated to the CCO
Direction and Oversight Committee and the Transport and Infrastructure
Committee. The views of local boards have not been sought. CCOs, including Auckland Transport, 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
28. Each CCO reports on their contribution towards achieving Māori
Outcomes in their quarterly report. AT’s report has a separate page which
outlines the significant engagement it has undertaken with mana whenua in the
quarter, which supplements other programmes noted in the body of the report
(for example the discussion of Te Ara Haepapa on the safety page).
Ngā ritenga
ā-pūtea
Financial implications
29. Each of the
CCO’s quarterly reports contain information regarding their financial
performance. Paragraphs 9 to 13 in this report summarise the financial
implications.
Ngā raru tūpono me
ngā whakamaurutanga
Risks and mitigations
30. The CCOs
quarterly reports contain information regarding their key risks and issues.
CCOs report separately to the Audit and Risk Committee.
31. 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. As noted above, the tensions inherent in the
implementation of the safety programme are also noted as a risk.
Ngā koringa ā-muri
Next steps
32. The Quarter Two report (October to December 2022) will be provided
to this committee in February 2023.
Ngā tāpirihanga
Attachments
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No.
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Title
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Page
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a⇨
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Cover letter, AT Quater One report 2022-2023
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b⇨
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Auckland Transport Quarter One report, 2022-2023
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Ngā kaihaina
Signatories
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Author
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Edward Siddle - Principal Advisor
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Authorisers
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Alastair Cameron - Manager - CCO Governance &
External Partnerships
Phil Wilson - Director, Governance & CCO
Partnerships
Megan Tyler - Chief of Strategy
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