Council-Controlled Organisations Nothing New

14 July 2004

The proposed CCO or Council-controlled organisation which will coordinate planning of Flat Bush town centre is merely the latest in a line of organisations set up to carry out a function of the Council with businesslike efficiency and focus, Manukau mayor Sir Barry Curtis says.

"I am surprised there has been some criticism of the mere existence of such a body because it's nothing new. We have created and run similar organisations before and these have all been financial successes.

"For example, in the late 1990s the Council set up its former works and engineering department as a successful local authority trading enterprise, called Excell.

"Our graffiti removal is now done successfully by a trust we set up called the Manukau Beautification Trust.

"We have also set up a company to run the Whitford landfill in a joint venture with Waste management Ltd. That too is very successful and makes money. It will continue to grow in value as an asset as the demand increases in the region for space at landfills.

"We have also set up Manukau Water as a Council-owned business. It operates so efficiently that it provides the cheapest water in the Auckland region. In fact it is passing on recent efficiency gains to the public by reducing the price of water next year.

"All of these organisations operate successfully on business principles, so we can meet the social and community goals of the Council while operating in a sound and prudent financial manner.

"In addition the Council owns shares in and a strong voice in setting the direction of Watercare. Again, a very successful operation.

"So we have a long history of involvement in successful organisations employing outside management expertise that meets our goals on behalf of the community, as well giving us a financial return.

"The purpose of setting up a CCO for Flat Bush is to enable the development to be done in a controlled and sensible way so that the surplus goes back to the ratepayers of Manukau, not to property developers alone.

"We have no interest in competing with the private sector and we will be providing them with the framework to prosper. The only buildings we will build and own will be the traditional public facilities such as libraries, swimming pools and leisure centres, nothing else.

'In making key decisions we will be guided by the expertise of people from the private sector who'll be on the board, and they will be accountable for their performance.

"Flat Bush will be a huge project and one of the key functions of any council is to ensure proper standards are maintained in new housing developments. Flat Bush town centre is being developed from scratch and will happen on such a large scale that it must be properly controlled. Around 40,000 people will be living there in mixed housing within 10 years. We cannot let that scale of development go uncontrolled.

"Creating a CCO is the best way of achieving our goal. We are setting up a board with property management expertise from the private sector and they will be making the strategic decisions with a business focus. None of the board members may be a current employee or councillor and they must have relevant commercial or financial experience.

"As regards the claims that we should not be involved in property developing, that is bizarre. We will not be property developing. The private sector will be doing the building and property development. However we will be guiding the overall strategy to ensure that development meets a balance of environmental, social and community goals.

"It has proven a wise investment for the Council to buy up land in the area many years ago.

"In fact, over the past thirty years the Council has sensibly bought up land which we knew would be needed to meet the future growth of the city. And we bought it at very low cost for the benefit of the ratepayers.

"For example, the land which is going to become Barry Curtis Park has tripled in value since we bought it. If we hadn't bought it at the time, we would have had to spend a lot more to provide a superb recreational park for future Flat Bush residents." Ends

ENDS

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