Exec pay up 89% in two years

Mayor or­ders ‘ cul­ture change’ af­ter fresh salary hikes re­vealed

Weekend Herald - - FRONT PAGE - Bernard Ors­man

Auck­land Coun­cil’s salary scan­dal has widened with fresh rev­e­la­tions ex­ec­u­tive pay at one coun­cil body blew out by 89 per cent in t wo years when wage in­fla­tion is run­ning be­low 2 per cent a year.

Auck­land Tourism, Events and Eco­nomic De­vel­op­ment ( Ateed) has de­fended the in­crease in ex­ec­u­tive salaries from $ 1.096m to $ 2.07m be­tween the 2015 and 2017 fi­nan­cial years.

An Ateed spokesman said two new gen­eral man­ager roles largely ac­count for the in­crease in salaries be­tween 2015 and 2017. An­other rea­son was “staff at Ateed mov­ing through salary bands over time”.

“Like the rest of the coun­cil group, Ateed com­petes with the pri­vate sec­tor for se­nior man­age­ment and spe­cial­ist roles and salary bands are bench­marked against best prac­tice and re­viewed against mar­ket data,” the spokesman said.

The Ateed fig­ures fol­low rev­e­la­tions that one in five coun­cil staff earn more than $ 100,000, a 25 per cent in­crease to 194 staff now be­ing paid more than $ 200,000 and chief ex­ec­u­tive Stephen Town sign­ing off a $ 405,000 sev­er­ance pay­ment to a top ex­ec­u­tive in the past year.

The is­sue is be­com­ing a headache for Mayor Phil Goff, who vowed to cut fat at coun­cil when elected a year ago.

Last night, Goff de­clined to com­ment on the 89 per cent ex­ec­u­tive pay rise at Ateed and framed his con­cerns in gen­eral terms.

“Coun­cil has to pay com­pet­i­tively to at­tract good peo­ple, but like Auck­land ratepay­ers, I do not ac­cept the in­crease in the num­ber of high level salaries,” Goff said.

The mayor’s frus­tra­tion was spelled out in a let­ter to Town on Thurs­day where he called for a cul­ture change “based on value for money un­der­ly­ing ev­ery­thing we do” and im­me­di­ate an­swers on salaries above $ 200,000.

“Coun­cil needs to demon­strate clearly and trans­par­ently that the process of de­ter­min­ing and set­ting salary levels are ap­pro­pri­ate, re­al­is­tic and not ex­ces­sive,” the let­ter said.

Goff ’ s of­fice has also re­leased a sec­ond let­ter sent to Ateed board chair­man David McCon­nell ask­ing new chief ex­ec­u­tive Nick Hill to lead a ‘ first prin­ci­ples’ re­view of Ateed’s roles and func­tions.

The let­ter, dated Au­gust 22, sug­gests Ateed is doubling up on the work of Gov­ern­ment bod­ies like Touri sm New Zealand and Trade and En­ter­prise and needs to fo­cus more on eco­nomic de­vel­op­ment in “less pros­per­ous com­mu­ni­ties”.

Goff told the Week­end Her­ald that Ateed does some great things, like run­ning the World Mas­ters Games and pro­mot­ing Auck­land as a venue for movies, but he could not pre­de­ter­mine the out­come of the re­view that will feed into the new 10- year bud­get.

A Week­end Her­ald sur­vey of ex­ec­u­tive pay at Auck­land Coun­cil and its six coun­cil- con­trolled or­gan­i­sa­tions ( CCOs) found three CCOs have cut costs.

Water­care led the way with a 20 per cent drop, from $ 4.4m to $ 3.5m, by re­duc­ing the num­ber of ex­ec­u­tives and costs. Re­gional Fa­cil­i­ties Auck­land’s cost have fallen by 17 per cent by cut­ting ex­ec­u­tive roles from 22 to 17, and Auck­land Coun­cil In­vest­ments Ltd re­ported a 7.5 per cent drop by chip­ping away at costs.

Auck­land Coun­cil ex­ec­u­tive costs rose by 25 per cent, partly driven by a $ 405,739 “ter­mi­na­tion ben­e­fit” to a mem­ber of his ex­ec­u­tive in the past year.

Town has de­clined to say if the $ 405,739 ter­mi­na­tion ben­e­fit was for the same ex­ec­u­tive paid a $ 405,739 sev­er­ance pay­ment.

Auck­land Trans­port ex­ec­u­tive costs have risen 21.5 per cent, also driven by more salaries above $ 200,000.

Ex­ec­u­tive costs at Panuku De­vel­op­ment Auck­land can­not be mea­sured be­cause the CCO only came into be­ing in Septem­ber 2015 and has not been run­ning for two full fi­nan­cial years.

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