Part 7: What makes collaboration successful

7.1
In this Part, we summarise the themes that emerged from our interviews with people from the three district councils with collaborative agreements. We also pull out some lessons from our findings in the earlier parts of this report.

7.2
The lessons in this report are consistent with the findings of other good practice guides and reports published by the Office of the Auditor-General in recent years on issues involving collaboration in local and central government.¹

Commitment and trust

7.3
A common point that emerged from the interviews was the importance of commitment and trust for a collaboration to be successful.

The need for support and commitment from council staff and councillors

7.4
The people we interviewed from the three councils indicated that collaboration needs the support and commitment of staff and councillors. For example:

• For one council, the successful establishment of the agreement was said to have a lot to do with the passion of individuals at the time, with the strong commitment of councillors considered very important in setting up the agreement.
• In another council, there was cross-party political support when the agreement was proposed and there had been continuous support from changing chief executives. The commitment of the councillors was considered critical at the time the agreement was set up, and new councillors elected since had had the opportunity to question it but had not raised any issues.

Relationships must be based on confidence and trust in main personnel

7.5
The people we interviewed spoke of the need for relationships to be based on confidence and trust in important personnel. For example:

• In one council, the agreement was said to work because the people involved had good relationships and trust. The council staff were well respected for their roading expertise, which gave Transit confidence.
• In another council, the success of the agreement was also said to rely heavily on good relationships, particularly between the council and Transit. It was noted that this arrangement could be different without the current personnel and that, if there were changes in personnel, the continued success of the agreement would depend on how those changes were managed.
• That council was described as working hard on setting up a positive relationship with Transit long before the agreement was entered into, and it also had good working relationships with other roading agencies. The council had always seen Transit as a partner rather than an entity to battle with and considered it essential to establish relationships in the set-up phase.
• In the third council, those interviewed said Transit knew the council had good personnel leading the process, which influenced Transit's decision to be involved. This council had good working relationships with Transit and other roading agencies.
• A representative from one of the councils noted that a principal barrier for other local authorities wanting to set up collaborative agreements was their relationship with Transit, which was often narrowly based on issues about specific projects.

Concerns about losing control need to be addressed

7.6
While the specific reasons that the proposed agreements discussed in Part 6 did not proceed were different in each case, whether Transit or the district councils were giving authority to the other party to act on their behalf was an important factor. Each preferred to be acting on behalf of the other party rather than giving authority to the other party.

7.7
Transit and district councils each need to resolve their concerns about losing control in collaborative agreements. The need for some councils to let go of some misconceptions about giving up control of roading assets for collaboration to be successful is illustrated by some comments from our interviews with people from the three district councils with collaborative agreements:

• The perception that a council's power and governance would be diminished was not backed up by the experience of one council,. This council considered it was important for councils to overcome any prejudices they might hold about Transit representing central government. The mayor said he did not feel that he was losing any degree of control over local roads.
• Another council also considered that any fear of loss of control was ill-founded.

The importance of preparation

7.8
Another theme that emerged from the interviews was the importance of sound preparation in a successful collaboration. For example:

• One council experimented with sharing a network safety contract with Transit to test how well the two entities could work together as joint principals.
• This council also collected a lot of data on the condition of the roading network and had been thinking about what satisfied its customers. In-depth preparation took two years. The costs associated with developing the scope of the contract – data collection, drafting the specification, and other activities – were borne by the council. This council also had a good Asset Management Plan that was more advanced than other councils, and it went through an extensive process of setting service levels.
• For another council, it also took two years to set up the agreement and new contractual arrangements with roading contractors. An important lesson from this council was that setting up the framework for the collaborative agreement required a great deal of planning, and it was seen as important to address staff issues and get staff buy-in. The council considered the interests of the local community, and also held discussions with the Department of Conservation and roading contractors. Before the agreement was entered into, it was necessary to obtain Ministerial approval and Transfund’s agreement. This council considered it was important that sound documentation underpinned the agreement.

Choosing the right model and refining it over time

7.9
Disagreements between Transit and the councils on the appropriate model for collaboration were a contributory factor to some of the proposed agreements covered in Part 6 not going ahead.

7.10
One council emphasised the importance of choosing the right model for collaboration. It considered that:

• a performance-specified maintenance contract model would not have been appropriate; and
• the joint network management model would have been too complex, particularly because of the number of steps needed to make decisions.

7.11
We noted in Part 4 that the Western Bay of Plenty contract was subject to regular independent review and that arrangements for managing the contract were being refined over time. We consider that this type of review and refinement is important for successful collaboration in any form to help ensure that collaboration effectively achieves the desired objectives.

Being open to involving more than one local authority

7.12
The councils also noted a need to be open to involving other local authorities, while recognising that setting up successful collaborative agreements may be more difficult. For example:

• One council tried to involve neighbouring councils, but found that each considered itself unique and that, for many, roading was the reason they existed.
• Another council also considered forming partnerships with neighbouring councils but saw a unilateral arrangement with Transit as the best way forward. One reason for not entering into agreements with neighbouring councils was that they had different issues with Transit.
• The third council also approached neighbouring councils, but their existing contracts ended at different times and co-ordinating multiple agencies proved too difficult.

Setting up a framework for working together

7.13
In Part 4, we reported on how well the three existing collaborative agreements were functioning against the four elements that we expected to find in place. These elements were:

• effective governance;
• effective management of risks;
• effective communication and reporting; and
• effective contractual arrangements.

7.14
Our findings indicate that, for collaboration to be successful, Transit and councils need to ensure that a framework for collaboration is in place covering these four elements.

7.15
Governance arrangements need to promote effective joint management, enabling each partner to influence decision-making.

7.16
There needs to be awareness and ongoing management of risks, including succession planning for maintaining the effectiveness of agreements.

7.17
Communication and reporting needs to be aligned with meeting the requirements of the partners and providing accurate, clear, and relevant information.

7.18
Contractual arrangements need to be tailored to the circumstances and designed with savings and the interests of the partners in mind, taking advantage of longer-term performance-based contracting and specifying performance in terms of desired outcomes, to achieve efficiencies and better outcomes where feasible.

Analysing and tracking costs and benefits

7.19
In Part 5, we reported on the savings and other benefits from the three existing collaborative agreements. Our findings indicate that, in assessing whether to enter into agreements, Transit and councils need to understand and quantify, where possible, the expected costs and benefits. They also need to keep track of the costs and benefits realised where agreements go ahead to ensure that agreements remain viable and worthwhile.

1: These include Sustainable development: Implementation of the programme of action (June 2007), Achieving public sector outcomes with private sector partners (February 2006), Local Authorities Working Together (May 2004), and Co-ordination and Collaboration in the Criminal Justice Sector (October 2003).