Wellington councillor's multimillion-dollar vision

A Wellington city councillor is keen to model the capital’s works unit on the multimillion-dollar Christchurch-based City Care.

Wellington's council-owned CitiOperations is under threat, with its management keen to outsource CCTV drainage activity to City Care.

“It seems bizarre we haven’t looked at City Care’s model of outsourcing and thought about copying it. We did talk about it many years ago,” councillor Stephanie Cook told NBR ONLINE.

City Care is owned by Christchurch City Council’s investment arm, Christchurch City Holdings. It has an annual turnover of more than $350 million and outsources its services to 14 councils nationwide, including Auckland, Wellington, Tauranga and Hastings, as well as Z Energy.

City Care was formed 14 years ago and employs around 1500 people. CitiOperations has about 30 staff, down from a peak 20 years ago of 700.

Christchurch City Holdings, of which City Care is a major part, returned a profit of $97.3 million in the 2012 financial year. It paid $27.4 million in ordinary dividends to the council and $8 million in special dividends. The council says these dividends have helped keep rates 15% lower than they should be.

$100 million a year
Wellington city spends $100 million annually on infrastructure, most of which is outsourced.

But a group of councillors, including mayor Celia Wade-Brown, has called for a halt to the plan to outsource CCTV drainage and an extraordinary meeting is scheduled for April 4.

It will likely be new council ceo Kevin Lavery’s first contentious issue to deal with when he takes up his role in the same week.

Ms Cook told NBR ONLINE she wants the council to reconsider outsourcing the work and instead start rebuilding CitiOperations.

“City Care is huge around the country and it’s making a nice fat little return to the people of Christchurch. CitiOperations doesn’t do that. Whether we can rebuild it back to critical mass, I don’t know.”

Ms Cook says rebuilding the works unit and also offering outsourcing work would save on infrastructure costs and provide expertise which is now missing.

“We had huge expertise. These guys knew where every pipe and drip and leak and tap is. There was huge institutional knowledge.

"A good example of that was two years ago when we had an inner-city water mains burst. The water poured out and flooded local businesses.

“It took the contractor two hours to figure out how to turn the water off.”

She says the current proposal is at odds with a 2001 decision not to outsource CitiOperations works.

“Back then, the council had a philosophy of downsizing and outsourcing virtually everything. We also left some very clear instructions as part of the decision about retaining it at a critical mass and ensuring it had enough work."

Councillor Paul Eagle, who initiated the extraordinary meeting, warns the current proposal to outsource the CCTV drainage will leave the unit will it few other responsibilities and will probably spell the end of CitiOperations.

bcunningham@nbr.co.nz