What does QLDC's Audit, Finance and Risk Committee actually achieve?
A recent meeting suggests an ineffective approach to risk management.
It would be fair to say that the Queenstown Lakes District Council is somewhat accident prone when it comes to losing money.
Lakeview, the Road to Nowhere, the CBD upgrades, the Ladies Mile Toxic House - all sorts of projects have turned to proverbial custard costing ratepayers at least $300 million more than was budgeted. Plus there’s been a tendency for spent a fortune on consultants and now it looks as though the Shotover sewage crisis is going to hit us all with another few hundred million in costs due to various “surprises.”
On the Audit, Finance and Risk Committee are:
Mr Stuart McLauchlan (Chair)
Mr Heath Copland (Deputy Chair)
Mr Bill Moran
Councillor Lyell Cocks
Councillor Niki Gladding
Councillor Lisa Guy
So - why has this committee not spotted and controlled the various surprises that have resulted in massive budget blowouts. From attending this weeks meeting of the committee it seems the answer is simple - they don’t discuss the big stuff very much and generally bad news is not welcome.
A parade of staff present rosy reports suggesting a small surplus will be achieved on every project. The committee then thanks them.
Also this week Councillor Lisa Guy told the committee how she had been moved to tears by the recent release of Takahē near Glenorchy and anybody who did not cry “was not human” - this produced enthusiastic applause from the Audit, Finance and Risk Committee members. We could not see what this story had to to with Audit, Risk and Finance.
But buried in the agenda were things that the committee should perhaps have talked about but did not.
Like this letter from the council’s auditors, Deloitte, telling them that their risk management systems rated either “moderate” or “poor.” No discussion - no action required.
Read the full letter here.
A brief reveal of the money spent on the illegal wall around the Shotover Disposal Wall - no discussion and no indication who approved this. No discussion on how this open-ended situation will impact risk or rates - or anything.
“Shotover Disposal Field (WW) YTD Budget $265k with Actuals of $431k (Full year budget $843k) - GHD are engaged as the designer and business case provider. Optioneering is progressing with a draft Gap Analysis/Basis of Design report and a Multi Criteria Analysis workshop in Dec 24. GHD are developing a range of potential (Long List) options for assessment in March 2025. The compliance of the existing Disposal Field is an evolving issue. Additional input from GHD and Landpro has been required to support this. Financial and Schedule impacts are not yet fully known and will depend on solution.”
Paul Speedy, the special projects manager for Lakeview and Project Manawa (New council HQ) made an appearance by video link - no reason was given but he looked like he was at home, surely he could have attended the meeting in person?
The Head of Corporate Services, the extremely influential Meaghan Miller, also appeared by video link …. to be specific her name appeared - but we did not hear anything from her or see her.
Paul Speedy seemed under-informed and confused with Niki Gladding accusing him of not having changed one part of his regular three monthly report in three years. The whole room sensed that this was not a man performing well. CEO Mike Theelen had to step in an rescue him.
Which raises the question - why does Mike Theelen sit around the main table with the committee members. He’s staff - they are governance. All the other staff (around 30 of them) sat in the public gallery (no public) and then came up in groups of four to make their positive reports.
CEO Mike Theelen sits at the Committee table - but he’s not a member.