Timaru council drops $34m on consultants in five years

The Timaru District Council has forked out almost $34 million to pay consultants over the past five years.

According to figures released to The Timaru Herald by the council under the Local Government Official Information and Meetings Act 1987, it spent a whopping $33,994,388 on consultants between 2018 and 2022.

In the first three years, from 2018-2020, the amount spent increased at a steady rate of about $1m per year with $3.43m spent in 2018, $4.54m spent in 2019 and $5.39m in 2020. However, the amount spent in 2021 was almost double that of the previous year – with $10.37m paid. In 2022, that dropped slightly to $10.2m.

In 2018, the amount spent on consultants amounted to 7.23% of the rate take projected in the 2017/18 annual plan ($47.49m). In 2021, the amount spent equated to 19.37% of the projected rate take in the 2020/21 annual plan ($53.56m).

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The biggest spending departments in a single year were the financial services unit ($720,298 in 2022), the district plan review ($945,577 in 2020), drainage and water expenditure ($864,212 in 2021), road/street landscapes capital expenditure ($1.09m), urban water capital expenditure ($2.44m), parking facilities capital works ($814,073).

The council hired the services of 160 consultants in 2018, 166 in 2019, 201 in 2020, 231 in 2021 and 247 in 2022. The total number of different consultants used by the council over the five-year period numbered 214. The top ten consultants were paid $19.5m over the five-year period.

The highest paid was Canadian owned global engineering consultancy WSP New Zealand Limited, which previously traded in NZ as Opus, with $8.7m paid for engineering services and design.

In 2018, the CEO’s office ($47,645) and district plan review ($78,894) each accounted for 10 consultants, the planning department ($317,157) 17, the land transport unit 10 ($115,441) and the sewer capital works 12 ($678,194). They were the top four departments in terms of the number of consultants used that year.

In 2019, the departments with the highest number of consultants were the planning ($390,041) and district plan review ($386,777) departments with 15 each, urban water capital expenditure with 10 ($527,080), and the CEO’s office ($108,204) with 9.

In 2020, infrastructure management accounted for 14 ($395,905), the parks department 12 ($171,650), the planning department 15 ($147,337) and the district plan review expenditure ($945,577) the biggest spender with 17 consultants used.

In 2021, 22 consultants were used for the district plan review expenditure ($606,549) department, planning ($345,996) 18, waste minimisation operations total with 14 and infrastructure management ($362,909) and parks ($95,876) with 13 each.

In 2022, the CEO’s office paid 10 consultants ($209,287), urban water operations ($119,470) 11, planning ($529,587) 22 and district plan review expenditure ($448,140) 18.

The council was asked how much had been spent on consultants by each department for each of the past five years on August 24. Under the Act, the council had a maximum of 20 working days to respond. On Wednesday, September 21 (or day 20), the council explained it needed more time to compile the information, and requested an extension – allowed under the Act. The information was released just after 4.30pm on Friday afternoon.

In releasing the information, acting group manager commercial and strategy, Jason Rivett, explained the council had “incurred $636m in operational and capital expenditure over the last 5 years” as set out in audited annual reports.

“Consultants spend equates to 5.3% of total expenditure over this timeframe and has been a necessary part of delivering this investment in community infrastructure assets,” he said.

In 2021, a year when more than $10m was forked out to pay consultants, chief executive Bede Carran asked councillors to approve more money to pay “underpaid” staff. The council is not a Living Wage accredited employer.

In an operating budget report, tabled at a meeting on February 15, 2021, Carran warned the council of an increased wage bill for the year ahead, he said the council was underpowered and sought approval for 18 additional FTE roles.

In his report, Carran suggested increasing personnel costs from $20.998m in 2020-21 to $23.8m in 2021-22. The increase consisting of pay equity adjustments ($850,000), remuneration increases ($930,000), requested funding for new positions ($870,000) and water stimulus funding for new positions ($150,000).

Speaking to the report at the time, Carran told council all proposed increased personnel costs had been extensively analysed, and had there been a number of factors driving it up. .

“We have been underpowered, and that has had an impact on recruiting and retaining staff.

“There has also been an increase in the number of activities by council, so there is a need for greater transparency,” he said at the time.

He also said attracting people in the public sector was a challenge for many local authorities because they operated within “tight fiscal envelopes”.

“Offering the same level of salary and remuneration packages as the private, or even central government, is difficult.”

At the same meeting, the (then) group manager for people and digital, Symon Leggett, said a review had revealed a number of staff were underpaid for their roles, and they were losing staff to other organisations and then had staff contracted back at twice the rate.

Following Leggett’s comments, Carran was asked if the council would struggle to progress major projects such as the Theatre Royal redevelopment and Aorangi Park upgrade as a result of the staffing issues.

He said he was confident “in the delivery of the majority of the projects” in the Long Term Plan and said external factors such as the weather and supply issues posed a bigger risk to project delivery.

“Where we do not have the specialised skills, we need in house, we use the flexibility of external contractors to fill the gaps,” Carran said.

Carran, who is now paid $310,149 for the CEO role he has held since late 2016, spent more than $700k on consultants from his office alone. He clocked up $47,645 in 2018, $108,204 in 2019, $74,847 in 2020, $282,764 in 2021 and $209,287 in 2022.

Staff turnover ‘below national rate’

In August, 2021, data released to The Timaru Herald under the Act showed 47 permanent staff had resigned from their positions in the year to June 30, 2021.

In the two years prior, there were 34 and 29 resignations recorded. The figures excluded resignations of casual staff members.

At the time, Carran said the staff turnover rate was about 11%, which was below the national average of 19%.

He cited the tight labour market, competition for skilled staff and people “choosing the increased flexibility of contracting” as contributing factors to the turnover.

In a report released by the Taxpayers’ Union in June 2021, the council was listed as having 259 full time equivalents, 33 of which were paid salaries of more than $100,000. In the 12 months to June 2021, there were no performance related dismissals, but there were five severance payouts with a total value of $57,918.

‘A trend of regular restructuring’

On July 16, 2021, Public Service Association (PSA) organiser Ian Gordon raised concerns about the toll a fourth restructure since 2016 was having on its members.

At the time, Gordon said the union has “seen a trend of regular restructuring at Timaru District Council, which takes a toll on members through stress and uncertainty in the workplace”.

In December 2021, that restructure saw a major shake up of the senior leadership team with several managers leaving and the creation of new roles.

Donna Cross, who started at the council in 2019 as group manager commercial and strategy, left to take a role as a lawyer in Christchurch, and was replaced by Steve McKnight, Fonterra’s former general operations manager at Clandeboye and Studholme, who took up the position in December. Jason Rivett has been responding to requests from the team McKnight heads up, as acting group manager commercial and strategy.

Symon Leggett, who was group manager people and digital from 2018 and acting group manager community services from March 2020, left the council early December after starting as human resources manager in 2014. He declined to comment on his departure. However, the two positions he held were disestablished by council following his departure according to its online staff list.

New positions were also created with Beth Stewart-Wright appointed director user experience and community engagement and Hannah Goddard-Coles, the council’s former people and capability manager, appointed director engagement and culture.

In 2020, Sharon Taylor, group manager community services, left council after eight years.

At the beginning of 2021, former councillor and group manager environmental services, Tracy Tierney, resigned and took a role at the Waimakariri District Council. Paul Cooper replaced her as environmental services group manager.

Gordon also said, at the time, there had been an increase in union membership at the council.

Four days later, councillors voted to retain Carran in his role for a further two years – six votes to three.