Five days, or 15 years

by Lindsay Shelton
My favourite wellington.scoop headline last year was the one in December when we said there were 120,000 reasons for bringing parking services back to the council.

The reason I like it so much – five days later, councillors agreed, and voted to end their parking services contract and to revert to directly employing the staff.

The situation with the parking contractor was dire – over a three month period, it had sent out personal details from 120,000 parking tickets. Names, addresses, registration numbers. The lot. An extraordinary privacy breach, for which chief executive Kevin Lavery unreservedly apologised.

There were other organisational changes, too, in the last weeks of the council’s year. But none of the other decisions was taken so quickly.

The one that took the longest was the decision to close the council-owned waterfront company. It has taken 15 years.

Public concern about the waterfront company (which was set up in 1987) began in 1995 when its huge and ugly (and ultimately unsuccessful) retail centre and events centre were built on Queens Wharf. Concern grew in 1996, when the company wanted to build a casino on Taranaki Wharf. In the same year, Alastair Thompson (yes, the same one) reported in City Voice that the company was planning to convert the open space at Chaffers into a carpark. City Voice also revealed some local asset sales that no one had known about – the company had sold all the city-owned leasehold land, a block back from the waterfront. And it it had spent the proceeds. And it had a debt of $18m. The chief executive resigned before the end of the year.

Mayor Blumsky led the first efforts to get rid of it in February of 1998, He said it was no longer appropriate for the city’s waterfront to be run by a property company. An Evening Post editorial supported him and said the company was “exposed to public odium. Its legacy is debt, a marina, and an ugly ablution block monument to retail indifference which blights Queens Wharf.” But the mayor’s plan was narrowly defeated – 9 councillors voted for closing it, 10 for keeping it. After which (City Voice reported) the council agreed to pay $7.5m of the company’s debts and to lend it a further $10m. There was a second debate about closing the company in February, 2000. Andy Foster was one of a group of councillors who questioned whether it had a future. But that future proved to be a long one. It survived till last month. Here’s how the council announced its decision on December 7:

Mayor Wade-Brown says bringing Wellington Waterfront Ltd into the main Council will simplify design and consent issues. “It’s the right time to bring it in-house. The work on the waterfront can now be handled from within the main Council organisation, at less cost, including the Site 10 proposal.

The merger will save money by getting rid of the board, and presumably moving out of waterfront office space and shutting down the website. But the mayor is indicating that all staff are to be retained. She says

“WWL staff expertise can … be used in other Council urban development projects,”

Will it be the same approach with the merger of Positively Wellington Tourism and Positively Wellington Venues? The merger of these two council companies was also announced on December 7. Their two governing boards will disappear and presumably they won’t need to keep their two separate offices. But what will the newly-merged organisation be doing when it inherits two chief executives – each on salaries of more than $250,000. The mayor, again, is insisting (this time via twitter) that no one will lose their jobs:

Slimming CCOs [is] about fewer directors not job losses

In the real world of business – outside the council walls – staff cuts are an automatic (and expected) result of mergers. But we’ll have to wait till later in the new year to discover whether the council will come to this conclusion. The mayor says it’s too early to discuss details of the new merged organisation. For ratepayers, of course, it’s never too early to learn if the council is seriously planning to save some of their money.

 

8 comments:

  1. Nora, 1. January 2014, 19:30

    Have just reread Report 5 of the Governance, Finance and Planning Committee 11th December 2013, Page 56 and of concern is the following: “The company structure is required to be retained to hold the assets of the Waterfront in trust for Council with respect to the Marine and Coastal Area Act 2011. The Council’s Chief Executive, therefore, would be delegated authority to appoint directors to the company for administration and compliance purposes”

    Another point: “This alternative approach provides some modest cost savings in the area of governance costs of $76k per annum. The major gains are not in these savings but come from bringing in-house access to a range of urban development and regeneration skills that are not present within council and would otherwise need to be sourced externally at additional cost to advance important work programmes in this area.”

    Does this mean that waterfront projects will no longer rely on the members of TAG (Technical Advisory Group) for advice on key issues raised in submissions and at public forums? If so, what additional savings will be made?

     
  2. Peter, 2. January 2014, 7:06

    What does Celia Wade-Brown mean when she says: “WWL staff expertise can … be used in other Council urban development projects”? WWL is a structure that has consistently stuffed up at a considerable cost to the ratepayers. Many have not only paid for seemingly poor management through their rates, but have also felt obliged to contribute towards various hearings and appeal cases to curb a relentless locking up of the waterfront for private financial gain.
    Despite ‘selling off’ chunks of the city’s waterfront, WWL red ink remains on the books because of an attitude that has been akin to that of a casino gambler who believes the next win will clear the debt. Add to this the indulgence in expensive flights of fancy like a diving structure above a cesspit or ditzy dunnies that seem to have neither art nor patronage, and the constant tipping of money into means of subverting open governance (Variation 11, etc.).
    The city administration should treat the management of WWL in the same way as it dealt with its lowest paid workers, which led to the Mayor subsequently musing, “Why were our hands not on the steering wheel?” At least those workers made a practical contribution to Wellington instead of being a drain on the public purse.

     
  3. pollyanna, 3. January 2014, 10:13

    Like many Wellingtonians, I’ve been reluctant to venture outside in the gales, so another “paper war.” I found a press release from Richard MacLean, WCC Communications Officer,dated 30th November 2010.

    “Wellington City Council is to consider a recommendation from the Board of Wellington Waterfront Ltd that the company be reviewed next year in light of the effect of the global financial crisis on property development. A report on the proposed review is to be considered by the council on 15th December 2010. Mayor Celia Wade-Brown says she was thoroughly briefed on the impact of the economic downturn on WWLtd after taking office in October and supports the review taking place. WWL’s Board Chair, Robert Gray, says that, if approved, the review would look at a range of options for the company – from the status quo, to downsizing and moving its operations ‘in-house’ within the City Council. The Review would be conducted by Council staff in conjunction with WWLtd. The company’s staff and Wellingtonians in general would be consulted as part of this process.”

    This press release ends with the Chair saying cashflow from commercial activity has fallen significantly. “This has led to a much reduced work plan for the company in the foreseeable future.”

    Reading this, one has to wonder why it has taken three more years to make the decision?

     
  4. andy foster, 10. January 2014, 7:59

    Just to provide a quick context around the parking decision Lindsay. The release of information was not a factor in the decision making. The timing was completely coincidental.

    The decision was made as a result of a good year of assessment by Council officers of what delivery options there were, new technologies, potential suppliers, an expressions of interest process and then a tender process. Councillors were kept informed of the process. A decision was always required before Christmas to allow the significant amount of work to be done to allow any new operator (if that was the decision made) to gear up – procure technology, hire and train staff etc to be ready to commence operations on 1 July 2014. The recommendation to councillors was well formed in advance of the ’120,000 reasons’ !

    In respect of the Waterfront Company, we were clear that there would be a time when a separate structure to facilitate development of the waterfront would no longer be needed – in essence because ‘job done’. We are now close to that point with progress on North Kumutoto.

    While some people attack WWL can I suggest that Council has made the decisions over the last few years post the Waterfront Framework – sure on advice from WWL and from Council officers. Many of them have been controversial – people on both sides, councillors on both sides. There is no question that there is a lot of passion about the Waterfront ! (and that is a great thing – having people caring) Making decisions has involved weighing up a lot of issues at times – we have got some things wrong, but I think you look at the waterfront as a whole and it has become a fantastic asset for the city and its visitors. It has also received a very large number of awards over the years.

    Looking ahead I believe that we do need more tools to be able to work with developers and the private sector in areas across the city if we are going to see delivery of good quality urban renewal projects in the Central City and in the suburbs where medium density housing is planned. Of course these are all about creating a more attractive, more sustainable city. We have discussed the concept of an Urban Renewal Agency which could be stand alone or within Council. The skills of WWL staff alongside other existing skills (look at our fantastic Housing team and the work they have done in the ongoing upgrade of the Council’s housing portfolio, and slightly earlier by our Property Team working with developers in the redevelopment of Chews Lane) will I think be very valuable – as part of Council in delivering on the City’s broader Urban Development Strategy.

    Warmest regards

    Cr Andy Foster
    Chair Transport and Urban Development
    Wellington City Council

     
  5. CC, 10. January 2014, 10:52

    Research suggests the Housing Team came into existence when the Council contemplated flogging off the ratepayer-financed social housing stock to its mates. Central Government stopped that with a cash injection and a demand that the slums which had emerged from Council neglect should be upgraded.

     
  6. lindsay, 10. January 2014, 17:46

    The council’s housing team has an admirable reputation for coming up with award-winning and popular plans after carrying out very detailed and effective consultation with all those involved. The council’s waterfront company and its predecessors have earned the opposite reputation – developing unpopular plans without listening to the public voice, and three times facing defeat in the Environment Court, at great (and unnecessary) expense to both sides. Remember that the various waterfront companies wanted apartments and parking buildings on Waitangi Park, high rise buildings on Taranaki Wharf, a five-storey building on the edge of Frank Kitts Park, a massive hotel on the outer tee of Queens Wharf … I don’t share Andy’s enthusiasm about the value of such skills. I do however share his enthusiasm and admiration for the un-challenged skills of the housing team.

     
  7. Guy, 10. January 2014, 20:00

    Lindsay – your comment re the work done by WWL is, I believe, a little unfair. The Council has used external design consultants such as architects, engineers, and urban designers on a number of projects in Wellington, all with great outcomes. This includes not only the recent stellar work on the Housing Upgrade Projects, which have been winning high praise for a job well done – on very tight budgets – but also on the work in and around the waterfront. There have been numerous awards made for the architecture, the engineering, the landscaping and the urban design of the waterfront and the Kumutoto development is highly respected and exceedingly popular with the public, despite being opposed by Waterfront Watch at the time. The Meridian building is world-class in its approach to energy conservation, and Waitangi Park is equally world class with its fantastic flexible design and excellent locally-based planting. It leaves Auckland’s tawdry attempts at a waterfront precinct floating behind in its wake..

    The days of Lambton Harbour Development Corporation and the proposals for massive waterside high-rises are well past us now, and I think that the city needs to concentrate on getting the last parts of the jigsaw in place. That will involve the skills of WWL as well as the highly acclaimed skills of the private sector consultants that we are lucky enough to possess in Wellington. Projects that have been developed completely in-house by the Council have, sadly, been unsuccessful in comparison to projects produced largely by external teams – frequently composed of exactly the same teams of people that you praise in your comment above. Personally, I think that Wellington owes a great deal to the path carefully navigated by WWL between too much and too little. Hopefully we can all stick to the task of getting this last development, and last area of open space, both completed to the same high quality that the rest of the waterfront has achieved.

     
  8. andy foster, 10. January 2014, 20:03

    Thanks Lindsay for your kind comments about the housing team. In respect to WWL I did explicitly say ‘post the Waterfront Framework’ – with the exception of the Outer T hotel proposal which was WWL’s recommendation in part because there was a pre-existing contractual arrangement, but it was Council’s (majority) decision to proceed with the project – all the other examples are pre the Framework, and I would definitely agree that Lambton Harbour Ltd as it then was did ‘push the boat out’ somewhat at times! With the Waterfront Framework WWL became more of an advisory and delivery agency with Council as the decision maker rather than more of an independent planning and delivery agency.

    Warmest regards
    Andy

     

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