NZ Herald on CCOs

There are three interesting articles published in the NZ Herald yesterday and today, including two editorials, raising further concern about the power that will be wielded by the “Council Controlled (controlling?) Organisations” that are being established as part of the Super City.

First, here are some good extracts from yesterday’s editorial:

[last week]…the Herald said the current proposal could not stand. This week’s articles on the extent of the work to be undertaken by the CCOs and the powers at their disposal have served only to reinforce that verdict.

In several ways, they will bring an undemocratic element to the Super City. First, they will operate out of the public eye and be virtually unanswerable to Aucklanders. They can meet behind closed doors, and do not have to issue agendas and minutes, apparently to lighten the administrative burden.

Such a paltry attempt at an explanation can only underpin the view that the directors of the CCOs are deliberately being cushioned from local pressure and political influence. In no way can this be healthy.

The “secrecy” of how Auckland Transport and the other CCOs are proposed to operate is to me the most unpalatable part of the proposal and it is relatively easy to fix. Somewhat surprisingly, neither Rodney Hide nor Steven Joyce have shown any inkling to make changes to this aspect of the CCOs.

There are more fundamental issues here though, as the editorial explains further:

There is also no guarantee that Super City mayors will be able to deliver the platforms on which they were elected. The Auckland Council will also find its hands tied.

Under the third and final Super City bill, the transport CCO can, for example, prohibit the council from exercising any transport functions unless it delegates them. The directors wielding this power will, in the first instance, be largely appointed by Mr Hide and Mr Joyce. Thereafter, the council will appoint but not directly control them.

In essence, the CCO boards will run more than 75 per cent of services in the Super City at arm’s length from its elected representatives. The councillors will be restricted to writing spatial plans and statements of intents with the CCOs. Even the most worthy of these will be a pallid expression of democracy when every level of the decision-making is in the hands of unelected directors. Local-body politicians of every hue, including the leading mayoral aspirants, John Banks and Len Brown, have voiced their concern over this flight from democracy. They sense, correctly, that this is the recipe for a frustrated and disappointed citizenry.

In response, the Government has hinted at minor changes to make the CCOs more accountable to the council and ratepayers. But there has been no sign that it might, say, shelve the transport CCO or limit the waterfront agency to development issues. It seems resolved to impose this model on Auckland.

Better sense must prevail. If not, Aucklanders will, indeed, feel locked out of the major decisions on their city’s future. It is hard to think of the Super City starting life under a more serious handicap.

There has been quite a lot of debate about whether you want to only have the high order strategic parts of transport politicised and debated, or whether the more operational and delivery elements should also be under the control of the council. While certainly there are poor decisions made by politicians when it comes to transport matters, such as the Helensville rail service and cutbacks to bus lanes along Tamaki Drive, this has to be balanced against what is lost when these operational matters are put behind closed doors. Will unelected officials give as much of a damn about how unreliable Auckland’s train services are as an elected politician would? Experience so far this year suggests not.

Nevertheless, on balance I think that ARTA has been good for Auckland, having an agency that is dedicated to improving transport has had its benefits. But then it’s fairly strongly (though arguably not strongly enough) under the control of the ARC. So having some level of structural separation can be a good thing, but I guess the question is where you draw the line between what should be “in” council and what shouldn’t be. That is a difficult question, and surely one should err on the side of more political accountability rather than less. The current proposal errs enormously the other way.

The reason to do this is perfectly illustrated by the concerns of mayoral candidates Len Brown and John Banks. Clearly, in Auckland transport is going to either be election issue number one or very damn close to it. While both candidates seem sensible in their approach to the need for a balanced transport system (rather than the roadsfest central government seems keen on), there will undoubtedly be debates about which project should get priority, which candidate’s going to be best at getting the CBD rail tunnel built, which candidate’s going to ensure the reliability of trains in Auckland’s improved, which candidate’s going to promote more bus lanes and so forth. The same will be true of all the councillor candidates – who will actually be pretty powerful politicians given how few of them there are. And yet, while we could end up electing a hugely pro public transport council (or anti-public transport I suppose, although that seems unlikely in my opinion) they may be powerless to actually implement the policies on which they were elected. That just seems wrong.

Another article in yesterday’s paper, by John Roughan, explained in a very well thought out manner, why having CCOs for debatable issues like transport and the development of the waterfront is a bad idea:

Non-elected boards have worked well for government departments that can charge for their services, and for the chargeable services of local government. They can be given a measurable financial objective and left to decide how to organise and price the service to meet it.

The system works when the public doesn’t care how the service is organised so long as it remains reliable. The boards that will manage the Auckland Council’s property, water supply, stadiums, events and the like, should be fine.

But the system is problematic when the public cares about the means to an end. It is the means, not the ends, of solving traffic congestion or developing a public waterfront that are likely to arouse public interest and political disagreement. The ends are readily agreed.

While I disagree with other parts of Roughan’s article, I think he’s hit the nail on the head here in distinguishing between situations where CCOs make sense and situations where they don’t. It we compare water to transport, the difference becomes most clear. With water (wastewater and water supply) we don’t really care exactly how we get clean water, or how our wastewater is disposed of, as long as the water is good quality, the wastewater doesn’t end up in our harbours and it’s all done as cheaply as possible. Transport is hugely different to this, as while we are likely to all agree that the “ends” of less congestion, greater choice and so forth are what we’re aiming for, we really do care how we get there.

Whether we try to build our way out of congestion through massive motorway investment, or whether we build new railway lines, or whether we focus on improving bus lanes or whatever, are all matters of great public interest and debate. There is no clear right and wrong answer, the problem is not one that some engineer can simply work out with a computer programme and the different paths we take to getting the outcome we’re all aiming for will have tremendous impacts on people’s lives. It’s not a matter of debating whether this water pipe is plastic or concrete, transport is about debating issues that affect lives in a huge number of different ways. It’s complicated, it’s ugly, it’s debatable – and that’s why it needs to be accountable, transparent and democratic.

Today’s Herald on Sunday has an editorial that again looks at the CCOs. While it’s largely similar to previous articles, it does involve some interesting parts:

But an unelected mega-board looking after transport is even more chilling: if one thing unites Aucklanders it is the lament about how hard it is to get around the place, whether by public or private transport. Neither area is one that any sane Aucklander would want under the control of someone beyond the reach of electoral accountability. Ditto water, council investments, economic development, regional facilities and the city’s property holdings.

There is nothing yet in the proposed organisational set-up that says the council – and by extension the voter – will not be able to exercise control over these boards. But there is nothing explicitly to say that they will, either. Hide and his Cabinet colleague, Transport Minister Steven Joyce, have been quick to make placatory noises: in a jointly written op-ed piece in the Herald, they said that “transparency and accountability is [sic] a key feature” of the plan. But if the lines of accountability are not plainly laid down, that is so much cant. These boards are called “council-controlled organisations” (or CCOs), but there is no provision for the “council” to exercise any “control” over the “organisations”. The ministers seek to respond by saying “Trust us: we know what we’re doing”. We say “yeah right”.

It will certainly be interesting to see what changes, if any, come out of the select committee analysing the legislation that is setting all of this up. They report back to parliament on May 4th.