Tararua District Council

Taking out the middle man

Relationships with stakeholders have improved, grants are coming in, and staff members are happier – all because Tararua District Council reduced its reliance on external consultants.

Four years ago, the Council’s relationship with its regional council was at an all-time low. Tararua District Council was found guilty of ignoring an abatement notice. The Council was unable to get subsidies for its water-related capital improvements, and staff morale was down as they watched project budgets disappear into design and investigation phases. Ratepayers, local iwi, and other stakeholders were also far from happy at the lack of physical work to improve treatment plants.

Blair King started as Chief Executive soon after the guilty finding. What he remembers most about that time was the tension between the regional and district councils. He recalls it as a “he said, she said” situation and all about who was right. When meeting with the Horizons Chief Executive to get his take on things, they realised Council’s reliance on “middle men” was souring the relationship.

Effectiveness is delivering the right outcome. Efficiency is being able to demonstrate to others that things are being done as agreed, with the same or fewer resources.

Over time, Tararua District Council had become dependent on external consultants. Initially engaged to advise on the specialist aspects of infrastructure projects, consultants were soon taking on more and more operational work. Sky-rocketing costs and disenfranchised staff led Mr King to realise the nub of the problem lay in “different drivers”. This was also clear from the information being provided to Councillors, who were being advised by the consultants. “Consultants are required to report on what the contract says or what the client asks for, whereas staff members are required to be advisors, not advocates,” says Mr King. And as consultants charge for their time, Councillors were wary of asking too many questions, which meant further reports. However, they weren’t getting the information they needed to make good decisions.

The infrastructure projects that did go ahead were also problematic. “What I found was that the district council was spending money on outstanding performance, but in the wrong areas.” He uses the construction of oxidisation ponds as an example. “We had a community that was really concerned about what was going in the rivers but most of the money was spent on the front end, such as building screens, to minimise what went into the ponds. They were not seeing lower impact discharges.”

Risk management and accountability were also issues, as consultants – who could be blamed for mistakes – thought they were helping by removing all risks in developing solutions, adding to the costs needed.

Tararua District Council decided to empower its staff. “We have a lot of in-house knowledge,” says Mr King, particularly as the Council had been running an engineering cadetship for five years. The Council pays for local school students to go through a four-year engineering course at the New Zealand Institute of Highway Technology. Although the graduates are not bonded, most have stayed, resulting in a strong internal design team working in all of the Council’s asset areas.

The Council flattened the organisational structure, so now Councillors talk directly with staff and can ask lots of questions, canvassing all options. “Staff are very clear on what the objectives are and their accountability to ratepayers,” says Mr King. “They identify the relative risks and priorities and, as a result, it is a meeting of equals.” As a result, “staff have flourished” he says.

By simplifying procedures and restoring trust in the relationship with their regional council, needless duplication has been avoided, such as both councils monitoring the water quality of the same river.

Tararua District Council now has direct relationships with contractors, something previously managed by consultants. “It pays to have a good relationship with the people who get some 90% of any infrastructure budget,” says Mr King. “They also have years of experience and we find that our combined knowledge comes up with pragmatic and often innovative solutions.”

Although there is greater risk to the Chief Executive if things don’t work out, Mr King believes it is a small price to pay to ensure progress.

In 2009/10, the Council saved $300,000 in consultants’ fees – about 2% of rates – which went straight into local infrastructure. The improved asset knowledge and relationships have also meant securing over $2 million in external subsidies, allowing more physical works to be completed within rate constraints. Community feedback shows the support for this change.

Mr King is emphatic about the need for incoming chief executives to get good advice, especially in the first 100 days. However, with people often on their best behaviour during that time, that’s not always possible. If there is one thing he’s learnt, it is the importance of relationships. “Sit down with people and ask for their side of the story.”

Based on an interview with Blair King, Chief Executive, on 18 June 2012.

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