Wellington City Councillors have been reminded that their decision making about council-controlled organisations involves a pecuniary interest because they receive fees when they’re appointed as members of the boards of the organisations.
The reminder comes as councillors prepare for a meeting today which is to make decisions on the council-controlled organisations. The process could have become difficult because of an Act of Parliament which prohibits them from discussing or voting on any matter in which they have a pecuniary interest.
The council seems to have recognised the problem, by seeking a ruling from the Auditor-General.
That ruling has been provided in a letter dated 7 November and signed by the Assistant Auditor-General, Legal:
“We understand that the councillors who belong to CCO boards receive fees in that capacity.
“If so, those councillors will have a pecuniary interest in the recommendation to retain the existing CCOs as they will be retaining that source of income.
“The councillor who is a director of Wellington Waterfront Ltd will also have a pecuniary interest in the recommendations for that company.”
Today’s meeting of the strategy and policy committee is to decide on a recommendation that the waterfront company should be closed and its activities transferred to the council. The same paper recommends that all the other council controlled organisations should continue to exist, but that only one councillor should be appointed to any board and only if they have the right skills and experience.
The Auditor-General’s letter then offers a way to let the conflicted councillors off the hook:
“The matter of the appropriate governance structure for the activities undertaken by the CCOs is a significant policy matter that all councillors should be able to participate in despite their direct and potential pecuniary interests. The council has undertaken considerable work to revise its CCOs and their governance and it is important for councillors to now consider the outcome of that work and the council officers’ recommendations.
“We think it is in the interests of people in the district for all councillors to be able to participate …
“For this reason, we have decided to grant a declaration to enable members to participate … The declaration is in the following terms:
“The Auditor-General declares, under section 8(4) of the Local Authorities (Members’ Interests) Act 1968, that Section 6(1) of the Act will not apply with respect to discussion or voting on any matter before the Wellington City Council or any of its committees considering the findings and recommendations of the review of council controlled organisations undertaken in 2012.”
So today’s debate can continue, without anyone having to declare a conflict of interest. Not even the councillors who are paid for being members of the CCO Boards.
The greatest attention will focus on the decision whether or not to abolish the council’s controversial waterfront company. Lobbying has been intense in recent days. Councillors were this morning offering different predictions about the result. The vote is likely to be a close one.