Agenda of Governing Body - Thursday, 29 August 2024

1 Ngā Tamōtanga | Apologies

2 Te Whakapuaki i te Whai Pānga | Declaration of Interest

3 Te Whakaū i ngā Āmiki | Confirmation of Minutes

Click the meeting date below to access the minutes.

That the Governing Body:

a) whakaū / confirm the ordinary minutes of its meeting, held on Thursday, 1 August 2024, including the confidential section, as a true and correct record.

4 Ngā Kōrero a te Marea | Public Input

4.1 Public Input: National Public Health Service - Northern Region - Auckland Council's Local Alcohol Policy

Te take mō te pūrongo

Purpose of the report

1. To hear from the National Public Health Service – Northern Region regarding Auckland Council’s Local Alcohol Policy.

Whakarāpopototanga matua

Executive summary

2. Dr June Leung, Medical Officer of Health on behalf of the National Public Health Services – Northern Region will address the Governing Body and will focus on support for the Local Alcohol Policy.

3. There is a report on this agenda at Item 7 – Dates for bringing Auckland Council’s Local Alcohol Policy into force.

Ngā tūtohunga

Recommendation/s

That the Governing Body:

a) whiwhi / receive the public input from Jo Vanderwee on behalf of the National Public Health Service – Northern Region regarding Auckland Council’s Local Alcohol Policy and whakamihi / thank her for attending.

4.2 Public Input: Alcohol Healthwatch Whakatūpato Waipiro - Auckland Council's Local Alcohol Policy

Te take mō te pūrongo

Purpose of the report

1. To hear from Alcohol Healthwatch Whakatūpato Waipiro regarding Auckland Council’s Local Alcohol Policy.

Whakarāpopototanga matua

Executive summary

2. Jennifer Lamm, Acting Executive Director on behalf of Alcohol Healthwatch Whakatūpato Waipiro will address the Governing Body and will focus on support for the Local Alcohol Policy.

3. There is a report on this agenda at Item 7 – Dates for bringing Auckland Council’s Local Alcohol Policy into force.

Ngā tūtohunga

Recommendation/s

That the Governing Body:

a) whiwhi / receive the public input from Jennifer Lamm on behalf of Alcohol Healthwatch Whakatūpato Waipiro regarding Auckland Council’s Local Alcohol Policy and whakamihi / thank her for attending.

4.3 Public Input: Communities Against Alcohol Harms Inc, Otara Gambling and Alcohol Action Group and Turehou Māori Wardens - Auckland Council's Local Alcohol Policy

Te take mō te pūrongo

Purpose of the report

1. To hear from the Communities Against Alcohol Harms Inc, the Otara Gambling and Alcohol Action Group and Turehou Māori Wardens regarding Auckland Council’s Local Alcohol Policy.

Whakarāpopototanga matua

Executive summary

2. Grant Hewison, Secretary on behalf of Communities Against Alcohol Harms Inc, Nathan Cowie on behalf the Otara Gambling and Alcohol Action Group and Mereana Peka on behalf of Turehou Māori Wardens will address the Governing Body and will focus on support for the Local Alcohol Policy.

3. There is a report on this agenda at Item 7 – Dates for bringing Auckland Council’s Local Alcohol Policy into force.

Ngā tūtohunga

Recommendation/s

That the Governing Body:

a) whiwhi / receive the public input from Communities Against Alcohol Harms Inc, the Otara Gambling and Alcohol Action Group and Turehou Māori Wardens regarding Auckland Council’s Local Alcohol Policy and whakamihi / thank the representatives for attending.

4.4 Public Input: The Salvation Army - Auckland Council's Local Alcohol Policy

Te take mō te pūrongo

Purpose of the report

1. To hear from The Salvation Army regarding Auckland Council’s Local Alcohol Policy.

Whakarāpopototanga matua

Executive summary

2. Ana Ika, Social Policy Analyst / Advocate on behalf of The Salvation Army will address the Governing Body and will focus on support for the Local Alcohol Policy.

3. There is a report on this agenda at Item 7 – Dates for bringing Auckland Council’s Local Alcohol Policy into force.

Ngā tūtohunga

Recommendation/s

That the Governing Body:

a) whiwhi / receive the public input from Ana Ika on behalf of The Salvation Army regarding Auckland Council’s Local Alcohol Policy and whakamihi / thank her for attending.

5 Ngā Kōrero a te Poari ā-Rohe Pātata | Local Board Input

6 Ngā Pakihi Autaia | Extraordinary Business

Governing Body

29 August 2024

Dates for bringing Auckland Council's Local Alcohol Policy into force

File No.: CP2024/11250

Te take mō te pūrongo

Purpose of the report

1. To agree the date or dates for when Auckland’s Local Alcohol Policy comes into force.

Whakarāpopototanga matua

Executive summary

2. The Sale and Supply of Alcohol Act 2012 enables councils to make a local alcohol policy to influence the location, number and trading hours of businesses licensed to sell alcohol.

3. Following research, engagement with stakeholders and the public and the Special Consultative Procedure, Auckland Council adopted a Local Alcohol Policy (the policy) in 2015. Between 2015 and 2024, the policy was subject to multiple appeals, many of which Auckland Council successfully defended.

4. With no appeals remaining in June 2024, Auckland Council resubmitted the policy to the Alcohol Regulatory and Licensing Authority (the Authority). As a result, and by virtue of a decision by the Authority on 2 August 2024, the content is now finalised.

5. Under section 80 of the Sale and Supply of Alcohol Act 2012, the council must now decide by resolution, the date or dates to bring the policy into force.

6. Staff recommend the council brings the policy into force as soon as practicable, as follows:

i) clauses on maximum trading hours for on-licences and off-licences to come into force on 9 December 2024, three months after public notification of the adoption of the policy

ii) all other clauses, including those regarding the temporary freeze and discretionary conditions, to come into force on 16 September 2024 following public notification of the adoption of the policy.

7. This approach ensures efficient use of council resources, prevents harm, and is likely to save the community and other stakeholders resources they would otherwise spend on case-by-case licence hearings. Based on discussions with the sector, and the fact licence holders have been aware of the policy for nearly a decade, staff do not expect this timing would cause unreasonable disruption to licence holders.

8. There is a risk that the policy is perceived as less effective due to the removal of some original elements through the judicial process. Staff will communicate that the final policy retains the key evidence-based elements to reduce alcohol-related harm.

9. Once the timing for the policy coming into force is resolved by the Governing Body, the decision to adopt the policy will be publicly notified and staff will begin implementation on the dates set.

Ngā tūtohunga

Recommendation/s

That the Governing Body:

a) whakaae / agree to bring the Auckland Council Local Alcohol Policy into force on the following dates:

i) clauses on maximum trading hours for on-licences and off-licences (being clauses 3.4, 4.3, 5.3, 6.1 and 7.1 and all of their sub-clauses) on 9 December 2024, three months after public notification of the adoption of the Local Alcohol Policy

ii) all other clauses, including those regarding the temporary freeze and discretionary conditions, on 16 September 2024 following public notification of the adoption of the Local Alcohol Policy.

Horopaki

Context

Sale and Supply of Alcohol Act 2012 enables councils to make local alcohol policies

10. Under the Sale and Supply of Alcohol Act 2012 (the Act) councils may have local alcohol policies to influence the location, number and trading hours of businesses licensed to sell alcohol. Local alcohol policies must be consistent with and reasonable in light of the object of the Act; to ensure safe and responsible sale, supply and consumption of alcohol and reduce harm.

11. The relevant District Licensing Committee and the Alcohol Regulatory and Licensing Authority (the Authority) must consider a local alcohol policy when deciding on new licence applications and renewals. Maximum trading hours in a Local Alcohol Policy also apply to existing licences.

Auckland Council developed a local alcohol policy in 2015

12. Following extensive research and engagement including through the Special Consultative Procedure with the community, key stakeholders^{^[1]} and a Political Working Party^{^[2]}, the council adopted a Local Alcohol Policy (the policy).

13. The policy aims to provide licensing decision makers with tools and processes to make decisions that:

· are appropriate to the region and reflect the views of its communities

· minimise alcohol-related harm

· promote a safe and lively Tāmaki Makaurau.

The council defended multiple appeals which are now resolved

14. Between 2015 and 2024, the policy was subject to multiple complex appeals. Many of these were successfully defended. Some amendments were required during the judicial process including removing the use of Local Impacts Reports. The final policy is summarised in Attachment A.^{^[3]}

With approval from the Authority, the council can now bring the policy into force

15. With no live appeals remaining in June 2024, staff resubmitted the policy to the Authority. The Authority confirmed the policy on 2 August 2024. Now the council can bring it into force. To do this, under section 80 of the Act the council must:

· notify the public that the policy is adopted by publishing it twice in a daily newspaper

· resolve the date or dates when it comes into force.

Tātaritanga me ngā tohutohu

Analysis and advice

Bringing the policy into force will enable it to take effect

16. Bringing the policy into force will enable the policy to take effect including by enabling:

· District Licensing Courts and the Authority to make decisions having regard to the policy

· harm minimisation in the sale and supply of alcohol

· a lively and safe Tāmaki Makaurau.

Not bringing the policy into force would be costly and delay or prevent its effects

17. If the council did not bring the policy into force, it would mean continuing to have no policy and less influence on alcohol licence conditions and locations - or restarting the policy development process. A new policy would take approximately two years to develop and require significant staff and community resources.

18. There would also be a high likelihood of public and stakeholder criticism, given the time and money invested by the council and communities. Implementing the policy now ensures that the hard-fought policy to reduce alcohol-related harm are in place.

Legislation requires public notification and three months lead in on trading hours

19. The date on which the maximum trading hours come into force can be no less than three months after the date of public notification. There are no rules about when the remainder of the policy can come into force if it has been publicly notified.

20. Alcohol Licensing advise the statutory three-month timeframe is ample lead-in to continue communicating with licence holders and prepare to implement those elements of the policy. They see no negative impacts if the council resolves two dates for bringing the policy into force.

21. Staff are ready to notify the policy following this decision.

Staff recommend the council brings the policy into force across two dates in 2024

22. Staff recommend the policy is brought into force as soon as practicable on the proposed dates of 16 September and 9 December 2024 (as outlined in Table 1). This approach ensures:

· efficient use of council resources by avoiding further delays in the process

· prevention of harm through controls that promote the safe and responsible sale, supply, and consumption of alcohol

· potential savings for the community and other stakeholders and agencies on resources currently spent on case-by-case licence hearings.

23. In August, Alcohol Licensing staff informed agents, consultants, and major bottle store chains about the changes and the proposed dates for bringing the policy into force. Staff received two responses in support of the policy coming into force soon, and no negative feedback about the proposed dates.

Table 1 Statutory rules for bringing the policy into force

Element	Rules	Recommended Date
Discretionary conditions and other matters	After public notification	16 September 2024
Temporary freeze	After public notification	16 September 2024
Maximum trading hours	Three months after public notification under the Sale and Supply of Alcohol Act 2012	9 December 2024

Climate impact statement

24. Bringing the policy into force has no known climate impacts.

Council group impacts and views

25. The views and recommendations of council officers were considered in the development of the policy.

26. Some policy elements, such as discretionary conditions, may apply to licence applications by the council group in their event-hosting capacity. The policy aims to balance harm minimisation with promoting a thriving and vibrant city.

27. Alcohol Licensing is responsible for implementation and will begin on the dates set. This will include training inspectors on the changes, updating the reports submitted to the District Licensing Court and informing all licensees.

Financial implications

28. The council can bring the policy into force and implement it within existing budgets. There are no additional enforcement costs.

Risks and mitigations

29. Risks and mitigation are summarised in Table 2 below.

Table 2 Risks and mitigation

If	Then	Mitigation
There is a perception that the policy lacks effectiveness because some original elements were removed through the judicial process.	This may negatively affect the council’s reputation for fulfilling its commitment to reduce alcohol-related harm.	Communicate that the final policy retains the key evidence-based elements to reduce alcohol-related harm.
Licensees do not understand the regulatory changes.	They may not comply with the new rules.	Targeted communications for licence holders to clearly explain the changes.

Tauākī whakaaweawe Māori

Māori impact statement

30. The policy seeks to improve the equitable health and wellbeing of Māori in alignment with the Kaitiakitanga outcome of the Māori Plan:

· whānau wellbeing and resilience is strengthened, focusing on social equity and whānau wellbeing.

31. Throughout the initial engagement on the policy, staff ran a workshop with rangatahi Māori and held a hui with mana whenua and mataawaka representatives.^{^[4]}

32. Through the development of the policy, a member of Houkura - Independent Māori Statutory Board has been on the Political Working Party and on the Hearings Panel.

33. Māori public health organisation, Hāpai te Hauora was represented on the Public Health Sector Working Group. Hāpai te Hauora have recently said “this is a positive step, the sooner these changes are in place the sooner our communities face less inequitable alcohol-related harm”.

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

Local impacts and local board views

34. Local boards were engaged in the development of the policy, including through:

· Political Working Party membership

· engaging in regular workshops with staff, including through the hearings panel process

· all local boards provided written feedback on the draft policy.

35. Local boards (especially the southern boards) expressed concern about the proliferation of off-licence premises across their communities and wanted strict density controls in priority locations through the policy.^{^[5]}

36. The policy incorporated these concerns with the two-year freeze on off-licences in priority locations and following that, an ongoing rebuttable presumption (i.e. the presumption is that applications for new off-licences should be refused in the areas specified).

Ngā koringa ā-muri

Next steps

37. Following a Governing Body resolution to bring the policy into force, staff will:

i) publicly notify the policy during the week of 2 September 2024

ii) inform the Alcohol Regulatory and Licensing Committee of the Governing Body’s decision

iii) communicate the decision directly to licence holders through letters in September 2024

iv) undertake proactive public communication about the changes through social media and posters during September and November 2024

v) prepare to implement and enforce the policy content.

Ngā tāpirihanga

Attachments

No.	Title	Page
a	Summary of Auckland Council Local Alcohol Policy

Ngā kaihaina

Signatories

Authors

Bonnie Apps - Senior Policy Advisor

Morgan Brown-Sharpe - Policy Advisor

Authorisers

Louise Mason - General Manager Policy

Megan Tyler - Director Policy, Planning and Governance

Phil Wilson - Chief Executive

Governing Body

29 August 2024

North Harbour Stadium and Domain Precinct - report back to the Governing Body

File No.: CP2024/11857

Te take mō te pūrongo

Purpose of the report

1. To receive an update from the North Harbour Stadium and Domain Precinct Working Group in accordance with Governing Body resolutions from 16 May 2024.

Whakarāpopototanga matua

Executive summary

2. On 16 May 2024 the Governing Body resolved to require a report back on the process and timeframe to provide clarity on the future vision and role of North Harbour Stadium and Domain Precinct (resolution number GB/2024/45). The resolutions also required a process to be developed to identify the most appropriate ownership, funding, governance, and operational management model with any possible improvements for the precinct. The full resolutions are below:

b) agree the North Harbour Stadium and Domain Precinct will be kept as is – per option one of the Long-term Plan 2024-2034 for the North Harbour Stadium proposal – which includes allocation of $33 million of essential renewals invested over the next ten years – as work also progresses as follows:

i) agree to work progressing under option three – to change operational management – as per the Long-term Plan 2024-2034 for the North Harbour Stadium proposal, subject to clause b) iii) and b) iv) below;

ii) note that current operational and capex funding will continue until any new model is agreed between the Governing Body and Tātaki Auckland Unlimited Trust Board;

iii) agree that clarity needs to be sought on the future vision and role of North Harbour Stadium and Domain Precinct, as well as the process going forward to identify the most appropriate ownership, funding, governance, and operational management model, along with any possible improvements for the precinct;

iv) request that the Chairs and Deputies (or their nominees) of the Upper Harbour Local Board and Hibiscus & Bays Local Board co-lead a locally-led working group to progress clause iv) above, and report back to the Governing Body by 31 August 2024 on a process and timeframe for this. The membership, stakeholder involvement, terms of reference and reporting structures are to be determined by the co-leads;

v) request that the working group engage with Tātaki Auckland Unlimited Trust Board as owner of the stadium;

vi) direct Auckland Council’s Chief Executive to establish cost-effective resourcing and support to the process in clause b) ii), b) iv) and b) v) above;

vii) thank the local boards for their advocacy.

3. The North Harbour Stadium Working Group (Working Group) has been established and a terms of reference confirmed. The Working Group is co-led by the chairpersons and deputy chairpersons of the Upper Harbour and Hibiscus and Bays local boards, who are responsible for the membership, stakeholder involvement and reporting structures for this locally led working group.

4. The first meeting of the Working Group was held on 3 July 2024. After adoption of the terms of reference and some general discussion, several key themes were identified to assist in developing a future vision.

5. The Working Group acknowledged that there was a need to address the current operational management of the stadium, as a matter of priority. Key users expressed some concerns with the management approach and signalled the desire to build on the wider community needs and interests and improve accessibility to the stadium and Domain Precinct.

6. Of ongoing importance was ensuring, subject to any potential change to the operational management, the current operational and capex funding remains in place in accordance with the Governing Body resolution. Capex funding of $33 million of renewals is also essential until any new model is agreed by the Tātaki Auckland Unlimited Trust Board and the Governing Body.

7. A meeting was held between the Local Board chairs and deputies of the Upper Harbour and Hibiscus and Bays and Tātaki Auckland Unlimited Trust Board on 31 July 2024. Tātaki Auckland Unlimited have helpfully provided advice, support and information to develop this process, along with the original Governing Body resolutions.

8. A discussion document (North Harbour Stadium and Domain Precinct – for the people, by the people: A Discussion Document) has been prepared and is a supporting and evolving document.

9. The discussion document outlines the history and background to the North Harbour Stadium and Domain Precinct, the identification of issues, the context for the future, and an initial investigative analysis to identify a proposed pathway, timeframe, and resourcing.

10. Additional meetings have been held with several stakeholders since May 2024.

11. The chairpersons and deputy chairpersons of the Upper Harbour and Hibiscus and Bays Local Boards (steering group) are leading and working collaboratively with the working group, who are committed to a viable and vibrant future for the North Harbour Stadium and the Domain Precinct.

Ngā tūtohunga

Recommendation/s

That the Governing Body:

a) tuhi ā-taipitopito / note the North Harbour Stadium and Domain Precinct Working Group have prepared a discussion document.

b) tuhi ā-taipitopito / note the North Harbour Stadium and Domain Precinct Working Group wishes to pursue a concurrent two-stage process for the future of the North Harbour Stadium and Domain Precinct as follows:

i) Stage 1 – undertake a locally led Expression of Interest process in conjunction with Tātaki Auckland Unlimited to see if there is a party or organisation who could operate and manage the North Harbour Stadium and Domain Precinct for an agreed period commencing July 2025, subject to cost benefit analysis and a value for money assessment against the Stadium and Domain Precinct’s management in the prior financial year

ii) Stage 2 – undertake a concurrent process to determine the most appropriate ownership, funding, governance, improvements, and operational management model for the long-term future use of the North Harbour Stadium and Domain Precinct by December 2026.

c) tono / request that the North Harbour Stadium Working Group report back to the Governing Body with an update on Stage 1 and Stage 2 in clause b) above, prior to December 2024.

d) tono / request that Auckland Council’s Chief Executive and Tātaki Auckland Unlimited establish cost-effective resourcing, funding and support for clauses b) i) and b) ii).

Ngā tāpirihanga

Attachments

No.	Title	Page
a	North Harbour Stadium and Domain Precinct Working Group - Excerpt from Discussion Document

Ngā kaihaina

Signatories

Author

Lesley Jenkins - Local Area Manager

Authorisers

Alastair Cameron - Manager CCO/External Partnerships team

Jazz Singh - Chief of Staff

Phil Wilson - Chief Executive

Governing Body

29 August 2024

Delegations to Council officers under the Resource Management Act 1991, the Housing Accords and Special Housing Areas Act 2013 and the Local Government (Rating) Act 2002

File No.: CP2024/12050

Te take mō te pūrongo

Purpose of the report

1. To seek Governing Body approval of updates to the delegation to Auckland Council (Council) officers of powers, duties and functions under the Resource Management Act 1991 (RMA), the Housing Accords and Special Housing Areas Act 2013 (HASHA) and Local Government (Rating) Act 2002 (LGRA).

Whakarāpopototanga matua

Executive summary

2. On 23 June 2011, the Governing Body delegated all of its responsibilities, duties, and powers under the RMA, HASHA and LGRA directly to specific Auckland Council departments and officers (resolution GB/2011/123). A direct delegation from the Governing Body to staff is necessary as these Acts prevent sub-delegation by officers.

3. These delegations need to be updated to reflect the recent organisation restructure that came into effect on 1 July 2024. The proposed updates ensure that relevant staff retain their existing delegated authority and powers.

4. This delegation can only be amended by resolution of the Governing Body.

Ngā tūtohunga

Recommendation/s

That the Governing Body:

a) tautapa / delegate to Auckland Council officers and Hearings Commissioners the functions, duties and powers under the Resource Management Act 1991, the Housing Accords and Special Housing Areas Act 2013 and the Local Government (Rating) Act 2002 as set out in Attachment A of the agenda report.

Horopaki

Context

5. For administrative efficiency, the Governing Body has delegated to the Chief Executive Officer all of its responsibilities, duties, and powers subject to certain limits and restrictions. In turn, the Chief Executive has sub-delegated all responsibilities, duties, and powers to Auckland Council officers (subject to restrictions as recorded in the Chief Executive’s Delegations Register).

6. The general delegation from the Governing Body to the Chief Executive Officer excludes responsibilities, duties and powers under the RMA, HASHA and LGRA because these three Acts prevent sub-delegation by officers.

7. On 23 June 2011, the Governing Body delegated all of its responsibilities, duties, and powers under the RMA, HASHA and LGRA directly to specific council departments and officers, and Hearings Commissioners. This delegation was subject to restrictions recorded in the delegation approved by resolution GB/2011/123 (the Governing Body 2011 Delegation).

8. Amendments to this delegation can only be made by resolution the Governing Body.

Tātaritanga me ngā tohutohu

Analysis and advice

9. On 1 July 2024, changes to the council’s new organisational structure came into effect. Updates to the Governing Body 2011 Delegation are needed to ensure that officers retain their pre-restructure delegated authority and powers, and to ensure ongoing administrative efficiency.

10. It is also proposed that restrictions referring to sections of the RMA which have been repealed are removed and that references to council department names that have changed since 2011 are updated to reflect the current organisational structure.

11. The proposed updated delegation and associated restrictions are set out in Attachment A.

12. It is likely that further amendments to the delegation to officers and hearing commissioners will be needed in light of indicated reform of the RMA. Council officers intend to undertake a comprehensive review of the delegation and associated restrictions once central government provides further direction on the future of the RMA. Any future amendments needed to the delegation at that time will require approval by the Governing Body.

Climate impact statement

13. Approving the amended delegation will have no climate impact.

Council group impacts and views

14. Officers from the departments affected by the proposed updates to the delegation have confirmed that they support the proposed updates.

Financial implications

15. There are no financial implications for council from the recommendations in this report. Financial limits on staff delegated authority will continue to apply in accordance with existing restrictions.

Risks and mitigations

16. Approving the delegation as recommended is necessary for the on-going efficient day-to-day operation of the council.

Tauākī whakaaweawe Māori

Māori impact statement

17. Approving the new delegation will have no direct impact on Māori.

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

Local impacts and local board views

18. As the delegation relates to powers, duties and responsibilities of the Governing Body, and has no impact on the operation of local boards, local board views have not been sought in respect of this decision.

Ngā koringa ā-muri

Next steps

19. If approved, the updated delegation will have immediate effect and officers and Hearings Commissioners will continue to operate in line with the terms of their delegated authority.

20. Council officers will undertake a full review of the Governing Body delegation (and restrictions on that delegation) to Council officers and Hearings Commissioners in relation the RMA, once the Government gives further direction as to future resource management legislation.

Ngā tāpirihanga

Attachments

No.	Title	Page
a	Delegation of powers under the Resource Management Act 1991, Special Housing Areas Act 2013 and Local Government (Rating) Act 2002

Ngā kaihaina

Signatories

Author

Katy Bexley, Associate General Counsel - Public Law (Acting)

Authorisers

Helen Wild - General Counsel

John Duguid - General Manager Planning and Resource Consents

Phil Wilson - Chief Executive

No.	Title	Page
a	Forward Work Programme
b	Information Memorandum: Tāmaki Makaurau Recovery Office Update (Under Separate Cover)
c	Information Memorandum: Crown approval for co-funding Tāmaki Makaurau resilience projects (Under Separate Cover)
d	Action Memorandum from Waiheke Local Board: Humanitarian visas for Palestinians (Under Separate Cover)

Governing Body

29 August 2024

Shareholder Comments on Port of Auckland Limited Draft Statement of Corporate Intent

File No.: CP2024/09915

Te take mō te pūrongo

Purpose of the report

1. To approve shareholder comments on Port of Auckland Limited’s (POAL) draft Statement of Corporate Intent (SCI).

Whakarāpopototanga matua

Executive summary

2. In July the council sent a Letter of Expectation (LOE) setting out the council’s priorities and expectations (as shareholder) to help inform POAL’s drafting of their SCI (Attachment A).

3. POAL has provided the council with a draft SCI for the period ending 30 June 2027 to review (Attachment B).

4. As the sole shareholder, the council can provide comments on the draft SCI and POAL must consider those comments before finalising the SCI.

5. Staff have reviewed the draft SCI and consider that it includes all the information required under the Port Companies Act 1988 and responds to all the key expectations set out in the LOE.

6. Staff recommend that shareholder comments be provided to POAL as set out in this report. In summary those comments will ask POAL to:

i) specify what operational metrics POAL will report against each quarter;

ii) provide further details on the financial information, including specifics on capital projects and dividend projections;

iii) set ambitious targets for off-peak truck movements; and

iv) set Māori Outcomes targets to be monitored each quarter.

7. If the committee agrees to the recommendations, staff will prepare a letter for the Mayor to deliver to the chair of the POAL board providing the agreed comments on the draft SCI.

Ngā tūtohunga

Recommendation/s

That the Governing Body:

a) whakaae / approve the shareholder comments on Port of Auckland Limited’s draft Statement of Corporate Intent for the period ending 30 June 2027 as set out in this report.

b) tautapa / delegate authority to the Mayor to:

i) finalise the letter to Port of Auckland Limited setting out the shareholder comments on the draft Statement of Corporate Intent in line with the direction set by the committee.

ii) approve any amendments to the shareholder comments, if required.

Horopaki

Context

8. On 23 July 2024 the CCO Direction and Oversight Committee approved a LOE setting out the council’s priorities and expectations as shareholder to inform POAL’s drafting of their SCI (Attachment A).

9. Under the Port Companies Act 1988, POAL is required to provide the council (as shareholder) a draft SCI one month after the commencement of each financial year of POAL. Council may provide comments on the draft SCI and POAL must then consider those comments before finalising and publishing the SCI.

10. The SCI covers the financial year in which it is delivered (FY25) and each of the immediately following 2 financial years (FY26 and 27).

11. The SCI instrument is comparable to a Statement of Intent for a council-controlled organisation in that the SCI is the principal mechanism for establishing the strategic objectives of POAL.

12. The purpose of the SCI is to:

i) publicly state the activities and intentions of POAL and the objectives to which those activities will contribute; and

ii) provide a basis for the accountability of the Board of Directors of POAL to the council as shareholder for the performance of the company and its subsidiaries.

13. This year the SCI is developed in the context of a consensus reached by the council, POAL, and the unions during the recent Long-Term Plan (LTP) process. During the LTP discussions, POAL committed to significantly improving profits for the council by raising port charges and enhancing productivity. This commitment supports the Mayor’s broader goal of maximizing value and returns from the council’s strategic assets, thereby bolstering the council’s long-term financial position. Council requested that POAL solidify and reinforce this commitment through the SCI.

Tātaritanga me ngā tohutohu

Analysis and advice

Compliance with legislative requirements

14. Section 9 of the Port Companies Act 1988 sets out the required contents of the SCI:

a) the objectives of the group:

b) the nature and scope of the activities to be undertaken:

c) the ratio of consolidated shareholders’ funds to total assets, and definitions of those terms:

d) the accounting policies:

e) the performance targets and other measures by which the performance of the group may be judged in relation to its objectives:

f) an estimate of the amount or proportion of accumulated profits and capital reserves that is intended to be distributed to the shareholders:

g) the kind of information to be provided to the shareholders by the port company during the course of those financial years, including the information to be included in each half-yearly report:

h) the procedures to be followed before any member of the group subscribes for, purchases, or otherwise acquires shares in any company or other organisation:

i) any activities for which the directorate seeks compensation from the Harbour Board (whether or not the Harbour Board has agreed to provide such compensation):

j) the directorate’s estimate of the commercial value of the shareholders’ investment in the group and the manner in which, and the times at which, this value is to be reassessed:

k) such other matters as are agreed by the shareholders and the directorate.

15. Staff consider that the SCI includes the required content and meets POAL’s obligations under the Act.

POAL’s response to the council’s Letter of Expectation

16. POAL has responded to the key expectation set out in the council’s LOE. The council’s key expectations from the LOE and POAL’s response are set out in the below table:

LOE expectation	POAL response in SCI
Continued focus on worker health, safety and wellbeing	Confirmed they have an ambitious and forward-thinking strategic plan to facilitate safe, efficient, and profitable port operations. The approach is set out on page 5 of the SCI. SCI includes a target of zero fatalities and serious work-related illnesses or injuries.
Continued improvement of financial performance against specified financial measures	POAL have included the key performance measures and targets as requested in the LOE.
Improved financial returns to the council as shareholder	Commitment to improving profitability with a pathway of $65 million, $85 million, and $100 million Underlying Net Profit After Tax (NPAT) over the next three financial years (FY25- FY27) and increasing beyond. By FY27, POAL will deliver a fair return of ~10 per cent on equity.
Support the council‐led process to make better use of the central wharves	Confirmed POAL will consent and construct Bledisloe North Wharf to facilitate the sale of Captain Cook and Marsden Wharves to the city within 2-5 years and allow some public access to Bledisloe Terminal without compromising safety and commercial operations. Commitment to work with Auckland Council, Eke Panuku, and other stakeholders to complete master planning for the central wharves, so it can progress to a publicly endorsed plan.
Reduce the port’s contribution to city centre congestion	POAL will identify options and trade-offs for improving competitiveness of rail and coastal shipping relative to road transport, for discussion with the council and other stakeholders such as cargo-owners.
Improved sustainability outcomes	POAL set out “meaningful climate action” in the SCI including: · Maintain and implement decarbonisation roadmap. · Increase staff awareness of climate risk and options to reduce individual footprints. · Foster continuous improvement of port operations to improve efficiency and reduce emissions. · Maximise generation of renewable energy at POAL sites. Partner with suppliers to influence our scope 3 emissions. Develop and implement a Climate Adaptation Plan to adapt to the changing climate.
Continued focus on Māori outcomes	POAL will continue their programme of Iwi engagement across the 19 Tāmaki Makaurau Iwi. POAL have developed an internship programme to encourage more Māori to consider careers at POAL.
Work with the council to complete the Tripartite Agreement with the unions at the port and progress other longer‐term planning	Commitment to collaborate in this work in good faith and ensure it is prioritised and appropriately resourced to be successful.
Support the council’s efforts to improve the financial and non‐financial monitoring of POAL	POAL will continue to collaborate with the council on improving financial and non-financial monitoring.

Proposed Comments

17. Staff recommend that the council provide the following comments for POAL to consider before finalising their SCI.

Operational targets

18. The draft SCI does not specify performance targets for operational activities, marking a shift from the previous SCI. POAL plans to move away from reporting to the council against surface level operational targets each quarter. Instead, POAL are dedicated to delivering more comprehensive analyses of its financial and operational performance through six-monthly “deep dive” presentations to the CCO Direction and Oversight Committee.

19. Focusing on in-depth analysis during these committee meetings provides a more complete picture and context for POAL’s performance. The deep dives allow elected members to thoroughly explore the information provided by POAL.

20. However, the council would still benefit from visibility of POAL’s operational metrics each quarter. The draft SCI indicates that POAL will report “performance against POAL’s safety and operational metrics” in their quarterly reports. It would be beneficial for POAL to provide more specific details on what operational metrics they will report on in the quarterly updates. This approach will enable the council to monitor POAL’s operational performance and trends each quarter, while reserving the detailed discussions for the six-monthly deep dive sessions.

21. Feedback will ask POAL to specify what operational metrics POAL will report against each quarter.

Financial Targets

22. The financial targets in the draft SCI reflect POAL’s commitment, made during the LTP process, to significantly improve profits for the council. POAL aims to achieve Underlying Net Profit After Tax (NPAT) of $65 million, $85 million, and $100 million over the next three financial years (FY25- FY27) and increasing beyond.

23. Notably, the draft SCI includes a significant increase in capital expenditure, with planned investments of $84 million, $164 million, and $159 million over FY25-FY27. This represents a substantial rise from the previous SCI's projections of $44 million for FY25 and $42 million for FY26.

24. The increase in capital expenditure as compared to the previous SCI is due to POAL progressing their “Regaining our Mana” strategic plan faster than expected. POAL have moved on to the next strategic plan described as “Strengthening our Mana”.

25. The increased capital expenditure is attributed to POAL’s planned investments in major infrastructure projects, such as the construction of Bledisloe North Wharf, extensions to the Fergusson North Wharf, and capital dredging to accommodate larger vessels at the container terminal. Council staff recommend asking POAL to include greater detail of the intergenerational benefits that the capital projects will deliver.

26. The draft SCI does not clearly demonstrate whether the proposed dividends align with POAL’s dividend policy which is based on a percentage range of free cash flows to allow POAL to sustain an optimal capital structure as determined by POAL’s Board. This is due to the inclusion of routine capital expenditure in the free cash flow figures provided in the SCI. POAL has confirmed that the projected dividends are consistent with their dividend policy, and the council should seek confirmation of this alignment in the final SCI.

27. Feedback will request that POAL provide further details on the financial information, including specifics on capital projects and dividend projections.

Off peak truck

28. As outlined in the LOE, an area of focus for the council is POAL shifting more truck movements to off-peak hours. Council is determined to see significant improvements in this area, with the goal of encouraging distribution centres to operate and receive containers or cargo during the evening (off peak), thereby reducing the port’s contribution to traffic congestion. The council wants POAL to continue with the "time-of-use" charging approach for truck movements, increasing the cost differential between peak and off-peak periods.

29. Council wants to closely monitor this initiative and expects to see substantial progress. This approach should not negatively impact POAL’s financial or operational performance and therefore POAL should set ambitious targets for off-peak truck movements and include them in the SCI.

30. Feedback will ask POAL to set ambitious targets for off-peak truck movements and include them in the SCI.

Māori Outcomes

31. Council’s LOE requested that POAL continue to prioritise Māori outcomes and establish appropriate targets in the SCI. Houkura - Independent Māori Statutory Board secretariat have reviewed the draft SCI and observed that it lacks specific performance targets for Māori outcomes. While Houkura acknowledges that POAL has completed its Māori Outcomes Framework (Taura Herenga Waka) and references it in the SCI, they request that POAL set explicit targets within the SCI for quarterly monitoring. Houkura also emphasizes their interest in outcomes rather than merely measures.

32. Feedback will ask POAL to set Māori Outcomes targets in the SCI to be monitored each quarter.

Climate impact statement

33. Council specified expectations regarding POAL’s climate impact targets. POAL have responded by including their “meaningful climate action” which is summarised in the table above.

Council group impacts and views

34. POAL's debt is consolidated into the council’s accounts, making it crucial for POAL to manage its capital expenditure carefully to ensure optimal use of debt across the council group. The SCI outlines POAL’s targets for debt and capital expenditure to be monitored each quarter.

Financial implications

35. Council’s Finance staff have reviewed the draft SCI and assisted with the drafting of this report. Financial implications are discussed in the analysis and advice section of this report.

Risks and mitigations

36. The SCI is the principal mechanism for establishing the strategic objectives of POAL. Under the Port Companies Act the council (as shareholder) can provide comments on the draft SCI. If the council does not engage with the SCI process and provide comments, there is a risk that the strategic objectives of POAL will not be in line with the strategic direction and expectations of the council. To mitigate this risk, staff will work with elected members to fully engage with the process and provide comments as an engaged shareholder.

Tauākī whakaaweawe Māori

Māori impact statement

37. Houkura secretariat have reviewed the draft SCI and provided feedback to be included in the council’s comments on the draft SCI (see paragraph 31).

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

Local impacts and local board views

38. The governance of POAL is a Governing Body responsibility, and so we have not consulted with local boards.

Ngā koringa ā-muri

Next steps

39. If the Committee agrees to the recommendations, staff will prepare a letter for the Mayor to deliver to the chair of the POAL board providing the agreed comments on the draft SCI.

Ngā tāpirihanga

Attachments

No.	Title	Page
a	Letter of Expectation – Port of Auckland Limited 2024‐2027 Statement of Corporate Intent
b	Draft Statement of Corporate Intent - Port of Auckland Limited

Ngā kaihaina

Signatories

Author

Chris Levet - Principal Advisor

Authorisers

Max Hardy - Director Group Strategy and Chief Executive Office

Phil Wilson - Chief Executive

Governing Body

29 August 2024

Approval of Auckland Transport's Statement of Intent 2024-2026

File No.: CP2024/10100

Te take mō te pūrongo

Purpose of the report

1. To approve Auckland Transport’s 2024-2026 Statement of Intent (SOI).

Whakarāpopototanga matua

Executive summary

2. Auckland Transport’s (AT) SOI sets out the objectives and activities of AT for the next three years.

3. Staff have reviewed AT’s final SOI and reconciled it against the shareholder comments on the Draft SOI provided to Auckland Council in May 2024 (GB/2024/57).

4. The shareholder comments (Attachment A) on the Draft SOI were focused on gaining the confidence of Aucklanders, better alignment with group and council strategy, recognising Council’s role as a shareholder, improving passenger transport, continuing to focus on improving network productivity and doing things “better, faster, cheaper”, improving climate reporting and delivering on the council’s climate change and resilience objectives. There were also requests for some changes to performance measures, including provision of a baseline and better explanation on the methodology.

5. Following receipt of AT’s final SOI, staff engaged in further discussion with AT to ensure the final feedback better reflected shareholder feedback. Auckland Transport has made significant efforts to respond to the shareholder feedback and has addressed or responded to many of the matters raised (Attachment B). A workshop is being scheduled with elected members in September to discuss AT’s proposed 10-year strategic objective.

6. It is likely that AT’s SOI may need to be amended in the next few months to reflect any decisions made following the National Land Transport Programme 2024, and subsequent changes to AT’s capital and operational programme.

7. The report outlines the key changes in the final SOI from the draft SOI.

Ngā tūtohunga

Recommendation/s

That the Governing Body:

a) whakaae / approve Auckland Transport’s Statement of Intent 2024-2027.

Horopaki

Context

SOI purpose and approval process

8. The requirements for SOIs are set out in Schedule 8 of the Local Government Act (LGA) 2002. SOIs establish the objectives and activities for a CCO for the next three years, with a focus on this financial year. They serve as a basis for accountability to the council and provide an opportunity for the council to influence AT’s direction. Section 65 of the LGA requires the council to agree to the SOI as soon as practical after the SOI is delivered to it.

9. Key steps in the SOI process were:

i) a one-month extension of statutory deadlines for the 2024-2027 SOIs, as provided for in the LGA Schedule 8, clause 4, was approved (GB/2023/234)

ii) a letter of expectation was provided to AT (December 2023)

iii) Auckland Transport’s draft SOI was received by the council (1 April 2024)

iv) the Governing Body approved shareholder comments on 30 May 2024 (GB/2024/57)

v) Auckland Transport considered the shareholder comments at a public board meeting (25 June 2024)

vi) Auckland Transport’s final SOI was received by 31 July 2024.

Process to modify a SOI

10. Under the LGA Schedule 8, clause 6, the shareholder may, by resolution, require the board of a CCO to modify the SOI. Before making a resolution, the shareholder must consult the board on the proposed content of the resolution.

11. AT must then prepare and adopt a modified resolutions complying with the shareholder’s resolution and deliver the modified SOI within 1 month of its adoption.

Tātaritanga me ngā tohutohu

Analysis and advice

12. AT’s SOI is provided in Attachment B. Staff have reconciled shareholder comments against the final SOIs and this reconciliation is provided in Attachment C.

13. The shareholder comments focused on:

i) gaining the confidence of Aucklanders

ii) better alignment with group and council strategy

iii) clarity on roles and responsibilities, recognising the council’s role as a shareholder

iv) improving passenger transport

v) continuing to focus on improving network productivity

vi) doing things “better, faster, cheaper’

vii) more detail on climate mitigation and emissions reduction, including KPIs and targets, and improving climate reporting

viii) changes to performance measures, including provision of a baseline

ix) aligning financials with LTP

x) focus on implementing AT’s Achieving Māori Outcomes Plan

14. Following receipt of AT’s final SOI, staff engaged in further discussion with AT to ensure the final feedback better reflected shareholder feedback. Auckland Transport has made significant efforts to respond to the shareholder feedback and has addressed or responded to many of the matters raised.

15. Notable changes to the final SOI are:

i) Stronger commentary about the role and purpose of AT.

ii) Section 1.2 Strategic Overview – all CCOs were asked to consider how they would incorporate climate change considerations (whole of life greenhouse gas emissions and resilience) into work programmes and decisions, and AT was asked to provide a reporting framework against key council outcomes. AT has committed to these requests and progress against this should be reported quarterly to the Transport and Infrastructure Committee.

iii) Section 2.2 ‘Improving network productivity’ - more detail is provided on AT’s proposed programmes.

iv) A new section 2.6 ‘Core business and other activities’ replaces ‘Deliver our capital programme’. This section represents AT activities that do not fall within AT’s five accelerated areas. It includes some of the deliverables previously in ‘making every interaction count’ and deliverables relating to climate, achieving Māori outcomes, safety, cycling and road maintenance.

v) The capital programme and financial section reflects council’s Long-term Plan 2024-2034. CCOs have been asked to comply with the Budget Responsibility and Transparency Rules. It is recommended that AT strengthen the information provided on capital programmes and major project milestones in quarterly reporting.

vi) Appendix 3 provides detail on performance measures, including baselines. AT have included a new measure ‘PT Utilisation”, which reflects the peak number of passengers onboard each service out of all seats available.

Shareholder feedback that has been addressed in part

16. AT has introduced a new 10-year objective: “By 2034 people can travel 10 km anywhere in Auckland in under 20 minutes”. A separate letter was sent by the Chair of AT Board to all councillors (25 July 2024) outlining this objective. Shareholder feedback was clear that AT is a CCO of Auckland Council and it is council’s role to set the strategic direction. Council should have an input into AT’s strategic objective. A workshop is proposed for September to discuss.

Meaningful performance measures

17. Council needs to be able to hold its CCOs to account for delivering what is expected, not only in terms of the nature and scope of the activities to be undertaken, but also in terms of levels of service. This requires the council to have a view about the measures and targets by which each CCO’s performance in providing these services will be assessed.

18. As part of the shareholder feedback, AT was asked to include a measure on ‘the percentage of capital project milestones delivered in line with asset management plan baseline approved by the board’. AT have suggested ‘Percentage of capital programme delivery on time’. We support this amendment as it provides more detail on how the capital programme is progressing.

19. The shareholder feedback also requested another additional measure: the total number of kilometres of bus priority lanes and active modes added to the network. AT note that council “will be kept informed of our progress on both capital milestones and delivery of bus priority lanes and active modes through regular reporting to the committee” and have added a measure ‘Kilometers of bus priority (including Special Vehicle Lanes and dynamic lanes) delivered’. This reflects approved funding. The significant reduction in investment for active modes through the RLTP means the cycling programme is currently being reassessed and is not included in the proposed measure.

20. In the 2023-2026 SOI, in consultation with the council, AT introduced a new measure ‘Proportion of Critical Assets in poor condition’, with a baseline of 4.7% and a target of 5.8%. This measure better reflected the concern that AT’s assets were in decline and focused on critical assets. This year, AT are proposing to change that measure to ‘proportion of key assets in moderate or better condition’ (than at the time of the last assessment), with a target of 85%. In the 2022-205 SOI this measure was the ‘Proportion of road assets in acceptable condition’, with a baseline of 94.6% and a target of 92%. It is not clear why the focus has moved away from critical assets, and it is difficult for council to get a year-on-year understanding of the status and criticality of our transport assets with the ongoing changes to this measure. We recommend the focus remains on the status of our critical assets and that this is also reported on in the quarterly performance reports. We would expect to see the performance against these measures trend down, with the additional spend on road renewals and maintenance provided in the Long-term Plan.

21. Note that Māori outcomes and climate change are covered in the relevant sections below.

Climate impact statement

22. AT recognises that changing climate conditions will significantly impact the transport system of Auckland, including AT controlled operations, services and assets. AT contribute to the preparation of a compliant group climate statement, and we are seeking a reduction in GHG emissions associated with their assets, operation, services and corporate activities. This is outlined in their Sustainability Strategy for 2024-2031.

Council group impacts and views

23. Auckland Transport’s SOI reflects feedback from council staff, generally applies the agreed approach and considers the impacts on the group.

Financial implications

24. Financial information in AT’s final SOI has been reviewed by Group Financial Planning and Analysis, and the budget is consistent with final Auckland Council Long-term Plan 2024-2034 decisions.

Risks and mitigations

25. As signalled by AT during the Long-term Plan and Regional Land Transport Plan process, based on previous years’ funding received by AT and confirmation of the funding across activity classes by the final Government Policy Statement for Transport, there are risks associated with the NZ Transport Agency Waka Kotahi funding on the proposed capital and operating programme in the SOI. Once the National Land Transport Programme funding decisions are made, council and AT staff will work through any financial implications, and modifications that may be required for the SOI. Any modification of the SOI will be brought back to the council for approval.

Tauākī whakaaweawe Māori

Māori impact statement

26. The Houkura - Independent Māori Statutory Board’s feedback to AT was to complete as a matter of urgency AT’s Achieving Māori Outcomes Plan by June 2024. The SOI notes they are currently drafting it. The AT Board’s forward work programme has it being approved in August 2024. Once adopted we expect to see progress on implementing this plan in AT’s quarterly reporting.

27. Houkura also asked that AT consider an additional two measures to ensure greater accountability and delivery for Māori across Tāmaki Makaurau. AT have added an additional key performance indicator. ‘Number of marae improved by AT’s programme’ that spotlights the work they do in this area.

28. The targets for AT’s ‘percentage of procurement spend with Māori owned businesses’ have increased for the 2024/25 and 2025/26 years.

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

Local impacts and local board views

29. Section 2.1 ‘Making every interaction count’ sets out how AT will work with local boards to agree local priorities and AT work plans. AT are also committing to providing clear communications to local boards on projects in their area and have increased the targets for local board engagement.

Ngā koringa ā-muri

Next steps

30. If the Governing Body approves the SOI, AT will report on performance every quarter and continue to provide monthly updates to the Transport and Infrastructure Committee.

31. As noted in the report, further modifications may be required to update AT’s SOI following decisions made through the National Land Transport Programme 2024.

Ngā tāpirihanga

Attachments

No.	Title	Page
a	Shareholder feedback AT SOI 2024-2027
b	Auckland Transport Statement of Intent 2024-2027
c	AT Shareholder SOI Reconciliation Table

Ngā kaihaina

Signatories

Authors

Claire Gomas - Principal Advisor

Tracy Xu - Principal Advisor CCO Financial Planning

Authorisers

Max Hardy - Director Group Strategy and Chief Executive Office

Phil Wilson - Chief Executive

Governing Body

29 August 2024

Chief Executive and Group Chief Financial Officer Update

File No.: CP2024/09613

Te take mō te pūrongo

Purpose of the report

1. To provide a monthly update to the Governing Body on key matters from the Auckland Council Chief Executive and Group Chief Financial Officer as of 31 July 2024.

Whakarāpopototanga matua

Executive summary

Chief Executive and Group Chief Financial Officer’s Update

2. Phil Wilson, Chief Executive and Ross Tucker, Group Chief Financial Officer will provide a summary of highlights, key activities and updates for the following:

i) Service performance

ii) Annual report timeframes and update

iii) Financial performance for Auckland Council and the Auckland Council Group

iv) Economic/market update.

Annual report timeframes and update

3. The Local Government Act 2002 (LGA 2002) requires the council to prepare and adopt an annual report and summary annual report each year. The council is also required to publish an annual report under the NZX listing rules.

4. The annual report and summary annual report for the financial year ended on 30 June 2024 are currently being prepared.

5. Auckland Council has bonds quoted on the NZX and as a result, has various obligations arising from the NZX listing rules and the Financial Markets Conduct Act 2013.

6. These obligations affect the way that the Auckland Council Group deals with information that may potentially affect the price of our bonds.

7. Obligations that relate to the annual report are:

i) annual results must be released to the NZX within 60 days of balance date, before being made public. We obtain Audit New Zealand’s verbal clearance on this information, with the release planned for Thursday 29 August 2024. This release contains limited information compared to the full annual report and is known as the NZX preliminary release.

ii) the full annual report must be released within three months of balance date.

8. Key dates for the 2023/2024 Annual Report and Summary Annual Report are:

Dates	Items
Tuesday 20 August	Audit and Risk Committee review of the NZX Preliminary release
Thursday 29 August	NZX Preliminary release
Tuesday 10 September	GCFO signs off full Annual Report, Summary Annual Report and NZX Release
Tuesday 17 September	Audit and Risk Committee review of Annual Report, Summary Annual Report and NZX release
Thursday 19 September	Provide draft Annual Report and Summary Annual Report to elected members for feedback
Thursday 26 September	Governing Body meeting to adopt the Annual Report and Summary Annual Report
Friday 27 September	Final NZX release including release of audit opinion, Annual Report and Summary Annual Report on Auckland Council’s website

9. To ensure that all market participants get the benefit of the information at the same time, and no one can hold, buy, or sell our bonds with the benefit of “insider Information”, our financial results and commentary is required to remain confidential until they are released on the NZX.

Financial performance for Auckland Council and the Auckland Council Group

10. The monthly financial dashboard for Auckland Council and the Auckland Council Group was not available at the time the agenda was due for release and will be made available prior to the meeting. A summary of the key highlights and results will be provided by the Group Chief Financial Officer at the meeting.

Economic/ market update

11. Key economic/ market activity and updates are:

i) Annual inflation rate – Consumer Price Index was 3.3 per cent at the end of June 2024 (updated quarterly, next due October 2024).

ii) Non-tradable inflation was at 5.4 per cent for the year to June 2024. Non-tradables are goods and services that do not face foreign competition and are an indicator of domestic demand and supply conditions. (updated quarterly, next due October 2024).

iii) Unemployment rate – 4.6 per cent to the end of June 2024, an increase of 0.2 per cent on the previous quarter. Updated 7 August 2024. (updated quarterly, next due 6 November 2024).

iv) Gross Domestic Product increased by 0.2 per cent in the March 2024 quarter, bringing annual growth to 0.2 per cent (updated quarterly, next due 19 September 2024).

v) The Official Cash Rate (OCR) rate was reduced from 5.50 per cent to 5.25 per cent on 14 August 2024 (next update is 9 October 2024).

vi) Auckland new dwellings consented numbers – 3,855 for the 12 months to June 2024 (27 per cent lower than the 12 months to June 2023).

vii) International migration (national level) – net gain of 73,300 people for the 12 months to June 2024, comprising 204,500 arrivals and 131,200 departures (provisional estimates, subject to revision).

Ngā tūtohunga

Recommendation/s

That the Governing Body:

a) whiwhi / receive the information provided in this report, in the monthly financial dashboard circulated prior to the meeting and the verbal updates by the Chief Executive and Group Chief Financial Officer.

Ngā tāpirihanga

Attachments

There are no attachments for this report.

Ngā kaihaina

Signatories

Authors

Karuna Dahya - Manager Group Performance Reporting

Helen Aksiuta - Project Manager

Authorisers

Ross Tucker - Group Chief Financial Officer

Phil Wilson - Chief Executive

Governing Body

29 August 2024

Auckland Future Fund Establishment Update

File No.: CP2024/11439

Te take mō te pūrongo

Purpose of the report

1. To provide a progress update on the establishment of the Auckland Future Fund.

Whakarāpopototanga matua

Executive summary

2. Following decisions to establish the Auckland Future Fund (the Fund) as part of the Long-term Plan 2024-2034 (LTP), staff have been progressing the appointment process for the directors of the Fund and preparatory work required to enable the directors to start their work and make key decisions about the operation of the Fund.

3. The Auckland Future Fund Trustee Limited, a wholly owned subsidiary of Auckland Council, is being established as the Trustee to hold, own and manage the Fund in accordance with the terms of the trust deed and relevant policies.

4. As a substantive council-controlled organisation (CCO), the Auckland Future Fund Trustee Limited (the Trustee) will operate under the high-level direction of council but through an independent structure. This means the directors of the Trustee will make key decisions about the setup of the Fund – including adoption of the Trustee’s own policies, appointing the investment manager and a fund administrator. The directors will also confirm how the ongoing activities of the fund will work, including the appointment of fund managers.

5. Any decisions about selling Auckland Airport shares and investing the proceeds will be made by the directors, with assistance from professional advisors appointed by the directors. There is no set timeline for this to take place.

6. To assist the directors with their work and ensure that they can make the required decisions as soon as is practicable once appointed, council staff have got some preparatory work underway. This preparatory work includes:

i) setting up the legal and governance framework within which the Fund and the directors of the Trustee will operate

ii) developing a proposal for the administration of the fund for the directors to consider

iii) developing a draft Statement of Intent for the directors to consider

iv) developing a draft Statement of Investment Policies and Objectives for the directors to review and finalise

v) seeking proposals for an investment manager and shortlisting candidates to support the directors with making their appointment decision

vi) seeking proposals for the provision of independent professional advice on options for executing a sell-down of Auckland Airport shares to support the directors with making their appointment decision.

7. Simon Allen, former Chair of Auckland Council Investments Limited, is providing specialist advice to support this preparatory work and ensure that the directors will be well placed to make key decisions once appointed. Staff are also meeting with the Chair of the Investments Political Working Group and the Mayoral Office during this period to maintain regular political oversight.

8. Work has been done to ensure that the drafting of the local bill is fit for purpose for the trust structure of the fund approved by the Governing Body, and staff have engaged with the Office of the Clerk and the Parliamentary Counsel Office. A final draft of the local bill is expected to be ready to share with the directors at their inaugural meeting for their comment.

9. This report provides the Governing Body with a progress update on this preparatory work and other related Governing Body decisions from 27 June 2024 (GB/2024/88) such as progressing legislative protection.

Ngā tūtohunga

Recommendation/s

That the Governing Body:

a) tuhi-ā-taipitopito / note progress with preparatory work to enable the directors of Auckland Future Fund Trustee Limited to start their work and make key decisions about the operation of the Auckland Future Fund once appointed.

b) tuhi-ā-taipitopito / note progress with seeking legislative protection of the Auckland Future Fund.

Horopaki

Context

10. On 27 June 2024, following adoption of the LTP, the Governing Body considered a report titled ‘Auckland Future Fund Establishment’ which sought decisions required to enable the Fund to be established and commence operations as soon as possible after 1 July 2024.

11. As part of that item, the Governing Body delegated authority to the Chief Executive to initiate and undertake all preparatory work reasonably required to implement the governance and fund management structure and other required tasks to establish the Fund (GB/2024/88).

12. Staff and advisors are meeting with the Chair of the Investments Political Working Group and the Mayoral Office during this period to maintain regular political oversight including over initiating procurement approaches for the Trustee to make appointments once directors are in place.

Tātaritanga me ngā tohutohu

Analysis and advice

13. The agreed governance and fund management structure for the Fund is shown below:

14. For the purpose of reporting on progress, implementation tasks have been grouped as follows and each are then addressed in turn:

i) setting up the legal and governance framework within which the Fund and the directors of the Trustee will operate

ii) developing a proposal for the administration of the fund for the directors to consider

iii) developing drafts of key governance documents for the directors to consider

iv) supporting the directors to make key appointments.

v) progressing legislative protection

vi) other required implementation tasks

Set up legal and governance framework

Director recruitment and appointment

15. A process to appoint a chair and two directors to the Trustee Board has been undertaken with recommendations for appointments due to be considered by the Performance and Appointments committee on 27 August 2024.

Incorporation of the Trustee

16. The Trustee will be incorporated under the Companies Act (like Eke Panuku for example). The incorporation process is not complex, but requires the initial directors to have been appointed, as a company cannot be incorporated without directors. The preparatory work is in hand to incorporate promptly on director selection.

17. The Trustee will have a pro-forma constitution along the lines of the other council CCOs. The trustee’s objectives and key operating parameters have already been set out in the relevant LTP policies and the draft trust deed.

Trust deed execution

18. A draft trust deed was approved by the Governing Body on 27 June 2024 to be finalised by the Chief Executive to ensure that it aligns with council objectives and the intended legislation currently being progressed. As this is a foundation document for the Trustee and the Fund, the trust deed has the single highest priority for review and approval by the directors at their first board meeting before being presented to the Mayor and Deputy Mayor for final sign off.

19. Staff have worked on refining the draft trust deed and draft local bill (see paras 36-39 below) to ensure they correctly align with each other to give the required layers of protection. The draft trust deed also provides the ability for the Trustee to take more assets into the Fund in the future.

Proposal for administration of the Fund

20. As the Trustee will not directly employ any staff, it is proposed that Auckland Council will act as the Fund Administrator to assist with the Trustee’s obligations and responsibilities under the trust deed. The council would provide services for the Trustee as set out in a service agreement, in consideration for the Trustee paying a service fee.

21. If the option to utilise council’s services is approved by the Trustee, the scope and terms of the service agreement will be finalised with the Trustee.

Drafting key governance documents

Draft Statement of Intent 2024/2025

22. As the Trustee will be established with more than six months left in the current financial year, it will be required to prepare and adopt a Statement of Intent (SOI) covering the period from establishment to 30 June 2025. To support this, council staff are preparing an initial draft SOI for the directors of the Fund to review and consider. At their first board meeting, the directors will then need to approve their draft SOI for submission to council as shareholder.

23. As this is the initial year of the Trustee, there is no Letter of Expectation from council, which will be received in future years. Letters of Expectation outline goals and components that the council is expecting to see in the Trustee’s Statement of Intent and subsequent performance. Although there is no Letter of Expectation for this initial SOI, there is substantial guidance provided to the Trustee from council resolutions and AFF-related policies.

24. Once approved by the directors, CCO Governance staff will undertake their usual review of the draft SOI to ensure it covers all the requirements under section 64 of the Local Government Act 2002 and is consistent with the Auckland Future Fund decisions and policy frameworks approved by council through the Long-term Plan 2024-2034 process.

25. Given the compressed timeframe to ensure the Trustee is operational as soon as possible and the desire to have an adopted SOI in place as soon as reasonably practicable, shareholder comments on the draft SOI are not proposed. The draft SOI will then be reported to the CCO Direction and Oversight Committee for approval as final. Once approved by council as shareholder, the directors will adopt the final SOI.

Draft Statement of Investment Policies and Objectives (SIPO)

26. Following their appointment, and in association with the professional investment manager that they choose to appoint, the directors will need to approve a Statement of Investment Policies and Objectives for the Fund (AFF SIPO) and report this to the Governing Body. The AFF SIPO will cover the intended investment strategies and objectives for the Fund, including strategic asset allocation; asset classes and benchmarks; and rebalancing and hedging settings.

27. This is a critical document for the successful operation of the Fund. To ensure that the directors and their investment managers are well placed to work through this document in a timely way, council staff are preparing an initial draft for them to receive and consider. Given decisions already made via the LTP and with the use of some specialist advice on industry best practise, staff consider that around 75 per cent of the SIPO can be progressed to a good state by the time of the first board meeting. However, the final 25 per cent of the content will require the exercise of professional judgement and will be a key matter for the board to consider and debate, after seeking expert advice from their appointed investment manager.

Supporting the Trustee’s key appointments

Procurement of Investment Manager

28. A key appointment for the directors of the Fund will be the professional investment manager to manage the AFF under a clear set of investment objectives and policies set by the council. To support the directors with making this appointment, a contestable Request for Proposal process has recently closed for evaluation. Shortlisted candidates will be reported to the first board meeting for the directors’ earliest consideration so that the investment manager appointment can be progressed with urgency.

Procurement of Auckland Airport shares execution advisor

29. The Fund will initially be capitalised with council’s remaining shareholding in Auckland International Airport Limited (AIAL). The LTP provides for the council to transfer its shareholding in AIAL into the Fund, and the subsequent sale of AIAL shares by the Trustee to achieve the purposes of the Fund.

30. To provide the directors with advice on options for the execution of any sale of the airport shares, council staff have initiated a contestable Request for Proposal process to engage an independent advisor. This will include advice relating to, but not limited to: sell down options; strategies to minimise execution risks; strategies to maximise value; timing considerations; engaging other advisers and brokers, communication strategy; investor engagement.

31. Because the council has already consulted on and made the decision to establish the Fund to be initially capitalised with the AIAL shareholding, strategic advice on that decision is not being sought as part of this process. Nor is the council looking to engage with parties to execute a transaction to sell the shareholding in AIAL at this stage. This would be a separate process initiated by the directors of the directors of the Fund.

32. The successful advisor will not be considered by the directors for any transaction execution role to sell the council’s shareholding in AIAL. They will be expected to provide independent advice on the transaction execution process and provide analysis as required to ensure that any potential future transaction execution is completed efficiently, cost effectively and successfully.

33. Shortlisted candidates will be reported to the first board meeting so that the directors can appoint a transaction advisor at the earliest opportunity to inform their decisions on the execution of any share sale.

Progress legislative protection

34. On 27 June 2024, the Governing Body resolved as follows (GB/2024/88):

d) whakaae/agree to:

i) promote an Auckland Council (Auckland Future Fund) Bill to ensure the Auckland Future Fund is a long-term financial investment for the benefit of the current and future communities of the Auckland Region, substantially as set out in the draft Bill at Attachment B of the agenda report

ii) tautapa / delegate authority to the Chief Executive to prepare and finalise the draft Bill and carry out procedural requirements, including those under Parliamentary Standing Orders, to enable the Bill to be introduced to the House.

35. Work has been done to ensure that the drafting of the local bill is fit for purpose for the trust structure of the fund approved by the Governing Body, and staff have engaged with the Office of the Clerk and the Parliamentary Counsel Office.

36. A final draft of the local bill is expected to be ready to share with the directors at their inaugural meeting for their comment. This is to mitigate any risk of the directors raising concerns with the bill during the select committee process. Following receiving any comments from the directors, the final draft bill will be approved by the Chief Executive under delegation ahead of public notification. It is expected that public notice of the council‘s intention to promote the local bill will be able to be given by the end of September 2024.

37. A sponsor for the bill has been identified and staff are working with their office to ensure that the Bill is able to be introduced to the House as soon as possible once the procedural steps required under Parliamentary Standing Orders are complete.

Other required implementation tasks

Significance and Engagement Policy

38. On 27 June 2024, the Governing Body adopted the Auckland Future Fund Policy. The policy states that:

“The council considers that the Fund (as a whole) is a strategic asset for the purposes of the Local Government Act 2002, and will treat it as such for the purposes of the Significance and Engagement Policy.”

39. Strategic assets are defined in section 5 of the Local Government Act 2002 as assets held by a local authority that the local authority needs to retain if it is to maintain its capacity to achieve or promote any outcome that it determines to be important to the current or future well-being of the community.

40. Sections 3.1 and 3.2 of council’s Significance and Engagement Policy specify which assets or group of assets the council has determined to be strategic assets.

41. On 27 June 2024, the Governing Body (GB/2024/88) noted that the categorisation of the Fund as a strategic asset was one of the strict protections to be implemented over the Fund assets, and delegated authority to the Chief Executive to amend the council’s Significance and Engagement Policy to include “the Auckland Future Fund as a whole” in the list of strategic assets in that policy.

42. The appropriate amendments to the Significance and Engagement Policy have been made and the policy is in the process of being updated on council’s website.

Responsible Investment Policy

43. On 27 June 2024, the Governing Body approved the Responsible Investment Policy to apply to the Fund, the Self-Insurance Fund and any subsequently formed council investment funds. It was however also agreed with staff that once the directors of the Fund were in place and had appointed their investment manager that directors and the investment manager would provide advice on responsible investment to a Governing Body workshop to consider any changes to the current adopted policy.

Climate impact statement

44. This report does not seek any decisions that would impact climate or would be impacted by climate change. However, it should be noted that the creation of the AFF is in part in response to the impacts of climate change and seeks to protect the intergenerational assets invested in the fund from further shocks as a result of future climate-related events.

45. The Responsible Investment Policy integrates Environmental, Social and Governance and climate change considerations where possible. It is expected that the investment manager of any council investment fund will seek to improve Environmental, Social and Governance practices of the companies they invest in through proactive engagement.

Council group impacts and views

46. Preparatory work to support the Trustee directors in their role once appointed is being led by council’s Group Chief Financial Officer and the development of artefacts covered in this report has involved extensive input from Group Treasury, Legal, CCO/External Partnerships, and Communications.

47. The views of the CCOs and Port of Auckland Limited have not been sought as the Fund does not directly impact on any of their activities.

Financial implications

48. The cost of establishing and operating the Fund has been provided for in the operational budgets for the LTP. The ongoing operational budget has been set at $400,000 per year.

49. The Long-term Plan 2024-2034 includes a $20 million fund for priority legacy projects in the 2024/2025 year which is intended to be funded from the enhanced returns from the Fund being achieved from 1 January 2025.

Risks and mitigations

50. If the establishment of the Fund is delayed, then there is a risk that the investment returns delivered by the Fund will not match the budgeted amount included in the first year of the LTP. However, this will be partially offset by the additional dividend income that is likely to be received from AIAL.

Tauākī whakaaweawe Māori

Māori impact statement

51. Houkura-Independent Māori Statutory Board has been involved in the decision making for the creation of the AFF.

52. As a substantive CCO, AFFTL will prepare an Achieving Māori Outcomes Plan.

53. In the recruitment of Trustee directors, common priorities for director briefs include that they will uphold the principles of the Treaty of Waitangi, promote improved outcomes for Māori and have knowledge of Te Ao Māori and established Māori networks.

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

Local impacts and local board views

54. The proposed decisions have no identified local impacts. The views of local boards were not required for the purpose of this update report; however, local boards were involved throughout the process of developing the LTP including providing input on the proposal to establish the Fund and to transfer the council’s remaining shareholding in AIAL to the Fund.

Ngā koringa ā-muri

Next steps

55. Next steps for the Trustee directors to implement the establishment of the Fund are detailed throughout the analysis and advice section of this report. All efforts are being made to ensure that the directors will be well placed to make key decisions once appointed so that the Fund can become operational and undertake its intended purpose at the earliest opportunity.

Ngā tāpirihanga

Attachments

There are no attachments for this report.

Ngā kaihaina

Signatories

Author

John Bishop - Group Treasurer

Authorisers

Phil Wilson - Chief Executive

Ross Tucker - Group Chief Financial Officer

Governing Body

29 August 2024

Committee Structure Changes and Appointments

File No.: CP2024/12568

Te take mō te pūrongo

Purpose of the report

1. To note changes to the committee structure, members, chairs and other roles, approve one change to the councillor appointed as a director of Auckland Transport (AT), and approve the updated allocation of the Auckland Council governance remuneration pool.

Whakarāpopototanga matua

Executive summary

2. The current committee structure was established in November 2022 (GB/2022/111). I signalled there would be a review after 6-12 months to ensure the committees were focused, efficient and allowed councillors to contribute meaningfully and subsequent changes were made in July 2023, including setting up a new Budget Committee.

3. Since then, we have adopted the Long-term Plan 2024-2034 and the organisation’s management has been restructured. It’s important to use this restructure as an opportunity to adjust the committee structure to allow for the most effective reporting from staff, and clearer governance oversight by councillors to ensure the organisation meets the expectations of Aucklanders.

4. Through the long-term plan process I also received councillor feedback that the current structure wasn’t operating as efficiently as it could, and some felt specific issues required more attention at the committee level.

5. The proposed structure takes on board the above and includes changes to chair roles, adjustments to work programmes and committee titles, and the addition of two smaller committees (a Community Committee and a Parks Committee) that will have oversight of the regional grants programme and oversight of the regional parks network.

6. There is some reallocation of committee memberships to ensure that all councillors have a reasonable workload and can contribute on matters of interest to them. The Deputy Mayor and I remain ex-officio members of each committee.

7. All changes are detailed in Attachment A which was circulated to members ahead of this meeting.

Other Roles

8. I propose to add a Lead Councillor for the new Auckland Future Fund, which will be given to Councillor Christine Fletcher acknowledging her leadership in this space.

9. Other appointments such as the membership of co-governance entities, portfolios, council organisation appointments and advisory panels remain unchanged.

Auckland Transport directors

10. I acknowledge Councillor Andy Baker for his service as a director of Auckland Transport (AT). Councillor Baker has served as a director of Auckland Transport since November 2022 and has provided significant input and guidance to the board since that appointment.

11. It is important we continue to rotate director membership on the board to provide others an opportunity to contribute. It also means we can utilise the experience of previous members in important committee positions.

12. Councillor Baker’s experience as a board member will be invaluable to the Transport, Resilience and Infrastructure committee. I will be appointing him as chair to reflect his experience and knowledge in this area.

13. To replace Councillor Baker for the remainder of the term I propose appointing Councillor Maurice Williamson.

14. We can appoint a director only if that person has, in the opinion of the council, the skills, knowledge or experience to guide the organisation and contribute to the achievement of the objectives of the organisation (s 57(2) of the Local Government Act 2002).

15. The councillor put forward meets this requirement. The rationale for appointing councillors as directors of AT is that doing so will assist the board to meet its obligations to understand and implement council policy and strategy for transport, including as reflected in its statement of intent, and be accountable for its performance to council.

16. Councillor Maurice Williamson is a former Minister of Transport and former Minister of Local Government. He has extensive experience working with transport experts and understands the complexity of central government relationships. This will be crucial as we continue to navigate transport system funding concerns and promote greater democratic oversight in transport decisions.

17. I propose Councillor Chris Darby remain on the AT board.

18. Councillors appointed to the AT board will receive director’s fees. My expectation remains that they retain an amount equal to the additional amount received by a chair of a Committee of the Whole and any amount received more than this is donated to charity. This approach reflects the workload of these roles and ensures a degree of parity with other councillors.

Remuneration adjustments

19. The Remuneration Authority has created a ‘governance remuneration pool’ (the pool) for the Auckland Council Governing Body to allocate between the different roles and responsibilities undertaken by councillors. The pool provides the total amount that can be paid in remuneration to councillors. The pool does not include remuneration for the mayor and local board members, which is set directly by the Remuneration Authority. The amount of the pool for Auckland Council is $2,688,183. The full amount must be allocated across the Governing Body.

20. On Thursday 17 November 2022, the Governing Body agreed to allocate the pool across the Governing Body, including the amount paid to a councillor for additional responsibilities (resolution).

21. Due to the proposed changes to the committee structure (Attachment A) and the associated roles and responsibilities, a small amount of the overall governance remuneration pool is now left unallocated ($1,378). It is recommended that this amount be allocated across all 20 councillors as part of the base salary rate (an additional $67.90 per councillor).

22. The following table reflects the decisions made by the Governing Body in 2022 as well as a recent annual adjustment made by the Remuneration Authority in July 2024, and the proposed reallocation of the remainder of the pool (under total):

Table 1:

Role	Additional (to the base)	Total
Deputy Mayor (1)	$57,035	$168,885
Chair, Committee of the Whole (3)	$32,867	$144,717
Deputy Chair, Committee of the Whole (1)	$23,333	$135,183
Chair, Decision-making Committee (4)	$23,981	$135,831
Deputy Chair, Decision-making Committee (4)	$22,296	$134,146
Chair of Other Committee (2)	$22,814	$134,664
Deputy Chair of Other Committee (2)	$20,740	$132,590
Councillor appointed as director of Auckland Transport (2)	0	$111,850
Councillor with no additional responsibilities (1)	0	$111,850

23. If the Governing Body agree today to allocate the remainder of the pool, payment will be backdated to the day following this committee meeting.

Climate impact statement

24. Responsibilities for climate matters are reflected in the Terms of Reference. All committees are expected to consider impacts to the climate and environment when decision-making.

Council group impacts and views

25. My structure provides for appropriate direction and oversight of CCOs and the Port company. Local boards have not been engaged on these decisions.

Māori Impact Statement

26. Houkura - Independent Māori Statutory Board representation on committees is reflected in the attached structure, including appointments to the new committees.

27. Houkura members continue to play an integral role in decision-making across committees.

Financial Implications

28. Remuneration implications are included in the body of this report.

Ngā tūtohunga

Recommendation/s

That the Governing Body:

a) note the decisions of the Mayor on changes to the committee structure, and appointment of chairpersons, deputy chairpersons and other roles; and

b) appoint Councillor Maurice Williamson as director of Auckland Transport to replace Councillor Andy Baker

c) approve the updated allocation of the Auckland Council governance remuneration pool as set out in the report, noting that this allocates the remaining governance remuneration pool resulting from changes to the committee structure and associated roles and responsibilities equally across all 20 councillors

Ngā tāpirihanga

Attachments

No.	Title	Page
a	Governing Body Structure and Roles

Ngā kaihaina

Signatories

Author

Mayor Wayne Brown

Governing Body

29 August 2024

Amendment to the Terms of Reference

File No.: CP2024/12228

Te take mō te pūrongo

Purpose of the report

1. To adopt an amended Terms of Reference for committees of the Governing Body, including membership, delegations, and responsibilities of all committees for the reminder of the 2022-2025 term.

Whakarāpopototanga matua

Executive summary

2. The mayor has the power to establish committees and appoint chairs and deputy chairs. The Governing Body gives effect to the committees by delegating responsibilities and powers in the Terms of Reference (the ToR).

3. The ToR includes all committees that report to the Governing Body. It also applies to other committees where Governing Body members are members of that committee.

4. The mayor has presented a report in this agenda which makes changes to committees and chair and deputy chair roles as well as some committee membership changes. This report addresses only the necessary changes to the ToR.

5. To ensure alignment with the mayor’s changes, the proposed amendments to the ToR are:

i) amending the current Planning, Environment and Parks Committee to become the Policy and Planning Committee. This committee will continue to provide direction for the physical development and growth of Auckland, and development and monitoring of policies associated with community, social, cultural, and environmental matters.

ii) amending the current Transport and Infrastructure Committee to become the Transport, Resilience, and Infrastructure Committee. This title change reflects the inclusion of oversight of physical resilience matters for this committee.

iii) establishing two new committees, the:

A) Community Committee, which will have a focus on community related programmes, including responsibility for the full regional grants programme

B) Parks Committee, which will be responsible for regional oversight of our regional parks and other significant open spaces

iv) minor text amendments; and

v) making changes to chair and deputy chair roles and some committee membership.

6. The proposed changes to the ToR are included as Attachment A to this report. The changes are shown as strikethrough (delete) and underline (insert) to indicate the nature of changes to the current version.

7. Houkura – Independent Māori Statutory Board membership to the new committees will be tabled on the day of the meeting.

8. Staff will update the meeting schedule. The new schedule will give effect to the committee structure and timing of meetings with immediate effect as outlined in the ToR.

Ngā tūtohunga

Recommendation/s

That the Governing Body:

a) whai / adopt the Terms of Reference in Attachment A of the agenda report and delegate those powers and responsibilities as listed in Attachment A with immediate effect.

b) whakamana / authorise the Director of Policy, Planning and Governance to amend the Terms of Reference by reflecting additional decisions of the Mayor and Governing Body that relate to membership and other minor amendments required to ensure completeness.

Horopaki

Context

9. The Terms of Reference (ToR) implement the committee structure established by the mayor. By adopting the ToR, the Governing Body is delegating the appropriate responsibilities and powers to, and setting quorums for, the committees established by the mayor.

10. The Local Government (Auckland Council) Act 2009 states that the mayor is an ex-officio member of all committees and Standing Order 4.1.1 states that both the Mayor and Deputy Mayor are members of all committees. This is explained in the opening section of the ToR.

11. An addition to the ToR is a description of the role of chairperson and deputy chairperson to provide clarity and guidance on the roles of each.

12. The ToR has been developed in consultation with councillors and staff from across the organisation, to ensure that reporting responsibilities align clearly with the purpose of each of the committees.

13. This ensures that committees have delegated responsibilities that staff, elected members, and the public understand where decisions are made and how the Governing Body has delegated its responsibilities to decision-making committees.

Tātaritanga me ngā tohutohu

Analysis and advice

14. Key roles for committees have been assigned by the mayor and membership is proposed as listed in the terms. The changes to the ToR are included as Attachment A to this report.

15. The changes are shown as strikethrough (delete) and underline (insert) to indicate the nature of changes to the current version.

16. The changes reflect the political direction of the committee structure established by the mayor.

17. The ToR manages operational, logistical, and legal factors to ensure the right allocation of responsibilities across the established structure.

18. Input from senior staff has been sought to ensure the most efficient and effective alignment of responsibilities for the committees in accordance with the structure. This includes relevant legal, financial, planning and operations areas of council who will be engaging on a regular basis with committees.

19. Governance staff have worked with the Mayor’s Office to develop a ToR that supports the purpose of the committee structure, the direction of the mayor and provides, for staff clear guidance of decision-making responsibilities.

20. Lead officers for the new committees will be appointed in consultation with the Chief Executive. The lead officer provides key support to the chair, deputy and committee members around work programmes and assists with establishing positive working relationships to support the committee.

Overview of the proposed changes to the Terms of Reference

21. The table below provides an overview of the proposed changes to the ToR:

Change to the Terms of Reference	Description
Reconfiguring the Planning, Environment and Parks (PEP) Committee to become the Policy and Planning Committee (PPC)	The reconfigured Policy and Planning Committee will continue to be responsible for setting the: · direction for the physical development and growth of Auckland through a focus on land use, policies relating to planning, growth, infrastructure, housing, as well as programmes and strategic projects associated with these activities; and · development and monitoring of policies associated with community, social, cultural, and environmental matters. The Policy and Planning Committee remains as a committee of the whole, and there are no changes to the chair and deputy chair.
Establishing the Community Committee	A new committee is established and is responsible for: · the full regional grants programme · oversight of community programmes and assets · oversight of the regional strategy relating to arts, culture and events. The committee will consist of 8 councillors, the Mayor and Deputy Mayor as Ex-officio and two Houkura – Independent Māori Statutory Board appointees and meet bi-monthly or as required.
Establishing the Parks Committee	A new committee is established and is responsible for the following activity areas: · oversight of regional parks, and other significant open spaces · working with the Auckland Domain Committee on matters of mutual interest The committee will consist of 7 councillors, the Mayor and Deputy Mayor as Ex-officio and two Houkura – Independent Māori Statutory Board appointees and meet bi-monthly or as required.
Minor amendments to reflect wider council group updates	Amendments to reflect the Independent Māori Statutory Board’s title change to include Houkura.

22. The amended committee structure and membership changes are in Attachment B.

Climate impact statement

23. All council decisions should consider direct and indirect impacts of climate change and the effects of a warming climate.

24. To ensure council meets it climate risk obligations the Governing Body, along with the committees of the whole do include specific references to the accountability for the impacts of climate change relevant to decisions presented to them.

25. This approach also helps ensure council is compliant with the External Reporting Board’s (XRB) climate standards which we are legislatively required to specifically include consideration of climate change.

26. This will also help further embed Te Tāruke-a-Tāwhiri: Auckland’s Climate Plan into our daily decision-making considerations.

Council group impacts and views

27. The wider council group will benefit from the new committee structure as it aligns with the Auckland Council Directorates, making the roles and responsibilities for reporting to the members clearer.

Financial implications

28. There are no direct changes to budgets or spending because of the changes to committees. Alignment and forum for decisions around decision making are altered, but the decisions themselves will continue in an appropriate forum.

29. Any remuneration changes impacting elected members is dealt with on another report on this agenda.

Risks and mitigations

30. The committee delegations align with councils’ minimum legislative requirements. Additional best practice initiatives around good audit processes and risk management, including independent oversight of those audit processes will continue with support of the Audit and Risk Committee.

31. Council’s legal advisors have provided advice on the committee structure, the ToR and mechanisms included to support effective decision making. These views have been included in the content of the ToR.

Tauākī whakaaweawe Māori

Māori impact statement

32. All council reports received by committees for decision-making required active consideration about the direct and indirect impact on Māori.

33. Accountability to mana whenua and mataawaka of Tāmaki Makaurau is a matter for consideration throughout all council decision making, regardless of the committee. Implications on Māori and the impacts of decisions (both direct and indirect) are important considerations for all report writers when providing advice to all committees of the Governing Body.

34. Input into decision-making by members of the Houkura continues to be provided on almost all committees, except where they may sit as ex-officio.

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

Local impacts and local board views

35. The ToR relate to committees of the Governing Body. Local board views have not been sought, as these are procedural matters for elected members of the Governing Body.

36. Opportunities are provided for local boards to comment and provide feedback on committee agendas and work programme items as a standard process.

Ngā koringa ā-muri

Next steps

37. Any additional refinements required to implement the proposed changes will be actioned by Governance staff, and an amended version of the ToR will be uploaded to the council’s website.

38. Staff will update the meeting schedule. The new schedule will give effect to the committee structure and timing of meetings as outlined in the ToR.

Ngā tāpirihanga

Attachments

No.	Title	Page
a	Amended Terms of Reference - August 2024
b	Amended committee structure and membership changes

Ngā kaihaina

Signatories

Author

Andrew Simon Pickering - Head of Governance Support

Authorisers

Lou-Ann Ballantyne - General Manager Governance and Engagement

Phil Wilson - Chief Executive

[1] Key Stakeholder Reference Group (licence inspectors, NZ Police, Medical Officers of Health, Council’s advisory panels, industry bodies, Independent Māori Statutory Board), Public Health Sector Reference Group and other stakeholders.

[3] Amendments the council made in response to the Alcohol Regulatory and Licensing Authority’s request were outlined in a memorandum to the Governing Body, in June 2024.

[4] Regional Strategy and Policy Committee report 13 May 2014.

7 Regional Strategy and Policy Committee Agenda Report, 13 May 2014.

Mayor	Wayne Brown
Deputy Mayor	Cr Desley Simpson, JP
Councillors	Cr Andrew Baker	Cr Mike Lee
	Cr Josephine Bartley	Cr Kerrin Leoni
	Cr Angela Dalton	Cr Daniel Newman, JP
	Cr Chris Darby	Cr Greg Sayers
	Cr Julie Fairey	Cr Sharon Stewart, QSM
	Cr Alf Filipaina, MNZM	Cr Ken Turner
	Cr Christine Fletcher, QSO	Cr Wayne Walker
	Cr Lotu Fuli	Cr John Watson
	Cr Shane Henderson	Cr Maurice Williamson
	Cr Richard Hills

Date	Subject
9.8.24	Information Memorandum: Tāmaki Makaurau Recovery Office Update
16.8.24	Information Memorandum: Crown approval for co-funding Tāmaki Makaurau resilience projects
19.8.24	Action Memorandum from Waiheke Local Board: Humanitarian visas for Palestinians

Author	Sarndra O'Toole - Kaiarataki Kapa Tohutohu Mana Whakahaere / Team Leader Governance Advisors
Authoriser	Phil Wilson - Chief Executive

Exclusion of the Public: Local Government Official Information and Meetings Act 1987