Billions of dollars of public assets at risk

Saturday, 25 November 2023

Some city assets are more critical than others. However, a report into Christchurch’s asset management has revealed concerning failures.

A lack of leadership and accountability is putting billions of dollars worth of public assets at risk, according to a leaked report into Christchurch City Council’s asset management.

A draft report into the issue, completed by external consultants Aurecon, paints a grim picture of the council’s ongoing failure to document the condition of many of its core assets.

Some maintenance is understood to be years behind schedule.

Assets can include underground pipes, roads, parks and playgrounds, as well as facilities such as libraries, pools and community centres.

The report has not been finalised, but the most recent version, received by the council in September, says confidence in the council’s asset data ranged from 10% to over 90%.

This was due to data not existing, being incomplete or outdated.

The report says organisational restructures and staff turnover had made the problem worse. The strategic asset unit, which had 19 staff four years ago, currently has just two.

Do you know more? Email sinead.gill@stuff.co.nz in confidence.

The Press understands that since the draft was received, the head of strategic assets, as well as a number of other staff within the unit, have resigned.

Knowing the condition of an asset means knowing when it needs to be maintained, repaired or replaced.

Assets within the $16b portfolio considered in a report ranged from rubbish bins to playgrounds and waterways.

A source with links to the council says some of the city’s critical asset infrastructure is years behind on maintenance, posing a significant financial risk as unknown problems become more expensive to fix in the future.

There is also a safety risk, the consequences of which the source described as “dire”.

“Someone could be seriously injured, or there might be another critical facility fire if immediate action is not taken,” they said.

They said staff are stretched too thin, and feel that the council’s senior leaders have been ignoring “shockingly inadequate” resourcing levels.

The version of the report seen by The Press says despite assessments in 2017, 2018 and 2020 identifying issues with poor, even incomplete asset data quality, the problem has persisted.

According to the report, the city council is aware of the quantity of 90% of its three waters assets, but is much less certain about its condition.

The report looked at asset data and processes within the council’s transport, three waters, facilities, parks, resource recovery, digital, and recreation, sports and events units, and found four of them achieved “basic” maturity.

Basic is the second lowest rating a unit’s asset management practices can be ranked. It means it achieved between 25-40 points out of 100.

Resource recovery, facilities, parks and recreation, sports and events were ranked as being basic.

Three waters achieved a core/intermediate maturity (between 45-80 points), while transport and digital achieved intermediate (between 65-80).

The report says the council had made some progress over time, but the “root causes” of problems had not been resolved.

One such issue was that staff restructures and resignations, coupled with a lack of documentation, had resulted in gaps in skill and experience.

Remaining staff were therefore making decisions based on their judgement, rather than data. Leadership and accountability was lacking.

Council sources say there has been a chain of resignations in recent weeks across various council units because staff are sick of the “toxic” culture, which they say has trickled down from the executive leadership team.

Lynn McClelland, assistant chief executive and head of strategic policy and performance, confirmed that out of nine full-time roles in the strategic asset management team, only two were currently filled.

Combined, transport and three waters assets are worth $11.3b.

In 2019, prior to a restructure, there were 19 people in that team.

McClelland acknowledged there were gaps in the council’s information, but said it was was working on improvements.

She said the council’s highly experienced staff made judgement calls each day on assets “based on information and evidence”, such as by using a policy framework for categorising critical and non-critical assets.

McClelland said that as an organisation, the council has the right number of staffing levels, “but it’s about how we use them”.

The council is currently reviewing the strategic asset team’s structure and position descriptions, and will begin recruiting staff after that, she said.

She also said the council was highly confident in the data of 70.6% of the assets covered by the report, which were in the three waters and transport units.

The report says, when it comes to three waters, the council has 90% confidence in the quantity of assets. However, it only has 50% confidence in the condition and performance of its assets.

It also says the council hasn’t completed a condition assessment for waterways since 2015.

McClelland said the report remains in draft as the council has more feedback to give and inaccuracies to remedy.

She said since receiving the draft report, the executive leadership team had decided to invest in better data and information systems.

A report on this would be presented to the council in the new year.