Part 4: Events leading up to Westland District Council's decision

Inquiry into procurement of work by Westland District Council at Franz Josef.

In this Part, we describe events that occurred in late June to early July 2017 in the days leading to the Council's decision on 5 July 2017 to carry out urgent work.

We outline how a few elected members became concerned about the risk of an imminent flood and went about finding a solution.

There are no written records of these events. The following account is therefore based solely on the recollections of those involved, primarily the Mayor and Councillor Havill.

Concern about imminent flood risk

At some point before the end of June 2017, one of the elected members, Councillor Graeme Olson, contacted the Mayor and Councillor Havill. He told them he had seen that the Waiho River was aiming towards the wastewater ponds and that, if the Council did not act quickly, they would lose the ponds the next time the river flooded.

On approximately 1-2 July, the Mayor and Councillor Havill took a helicopter ride over the Waiho River to view the situation. Their assessment was similar to Councillor Olson's. They believed the river had shifted to the north and was now moving directly towards the ponds. They told us they recognised the risk to Franz Josef and to tourism in the area if the river burst its banks near the wastewater plant again.

The Mayor and Councillor Havill's proposed solution

Following the helicopter ride, the Mayor and Councillor Havill discussed what could be done to protect the ponds. We were told that Councillor Havill's proposal was for a straight stopbank, approximately 120 metres in length and higher than the existing flood embankment that protected the wastewater plant. The Mayor supported this idea and asked Councillor Havill to source contractors for the job.

Councillor Havill first contacted the only locally based contractor with a large bulldozer. After some discussion, this contractor said that he was not available to do the work.

Councillor Havill then approached his brother, Geoff Havill, who is an employee of Blakely Mining Limited (Blakely Mining). Through his private business interests, Councillor Havill also had an existing business relationship with the Director and owner of Blakely Mining, Edward Blakely.

Councillor Havill told us that Blakely Mining had a Caterpillar D11 bulldozer that had been working at a gold mine on the West Coast and was in Greymouth for repairs. He said he understood that the bulldozer was to return to Christchurch after the repairs were finished. The company gave Councillor Havill a confirmed hourly rate for the bulldozer, an estimate of the hours needed to do the work, and the cost for shifting the bulldozer to Franz Josef.

Councillor Havill then sought a second contractor to place "rock armour" (or "rip rap") on the stopbank to protect it from erosion from the river. Councillor Havill approached MBD Contracting Limited (MBD) and negotiated a price for this work.

The Mayor announces the proposed work on Facebook

On 2 July 2017, the Mayor announced the work he and Councillor Havill had planned in a video posted on his Facebook page. In the video, the Mayor and Councillor Havill described the work, and said that equipment, including a "big bulldozer", would be on site the next week.

They described the work as including:

  • straightening the existing flood embankment, raising its height, and placing rock armour on it;
  • building a "very big soakage pit"; and
  • needing to build a much larger third pond.

On the video, the Mayor said that the Regional Council had "been good" and that they had said that anything the Council did in the river was "not a problem".

The Regional Council told us that the Mayor's Facebook post was the first it knew about the work.

The Acting Chief Executive advises that Council approval is necessary

About the same time as the Facebook post, the Mayor and Councillor Havill met with the Council's Acting Chief Executive. They told him that the Council would be hiring Blakely Mining to do the work and that, based on Councillor Havill's discussions with the contractors, the cost of the work was estimated to be $1.3 million.

We understand that the amount quoted was based on information provided to Councillor Havill by Blakely Mining and MBD. We also understand that it was intended to cover all of the work outlined in the Mayor's video posted on his Facebook page (see paragraph 4.12).

The Acting Chief Executive told the Mayor and Councillor Havill that the amount quoted for the work exceeded his financial delegation and that Council approval was needed.

The Acting Chief Executive called an extraordinary meeting of the Council for 5 July 2017 to discuss and approve the proposed work.

Our observations on the events leading up to the Council's decision

It appears that the Mayor, Councillor Olson, and Councillor Havill were genuinely concerned about the flood risk posed by the Waiho River and wanted to protect the Council and the community's assets.

The Mayor and Councillor Havill reached their own view that urgent action needed to be taken and what that action should be. No Council staff or river engineers were involved in their assessment.

After deciding what needed to be done, Councillor Havill approached contractors directly and negotiated arrangements with those companies. These discussions were done verbally and there are no records from the time. No Council staff were involved.

The work the Mayor and Councillor Havill announced on the Mayor's Facebook page went further than flood protection. It included expanding the wastewater plant to address problems with its capacity and infiltration gallery. It was essentially a proposal to develop the wastewater plant at its current site and build improved river protection.