RAM media release 25.5.05

ARC 'secret faction' slammed by RAM

A "secret faction" of the Auckland Regional Council was slammed at yesterday's submissions on the ARC's draft annual plan by a representative of RAM - Residents Action Movement.

RAM organiser Grant Morgan said that the $170 million Ports of Auckland share bid by ARC subsidiary Auckland Regional Holdings was "cooked up by a secretive, self-selected faction of ARC politicians and ARH bosses".

Grant Morgan told the ARC:

"Among those kept in the dark by this secret faction were senior ARC officers, including ARC chief executive Peter Winder. ARC officers were prevented from giving independent advice to ARC councillors on the ARH share bid. So here we have the ARC risking $170 million without first getting advice from its own officers. That is playing very fast and loose with public funds."

"Such was the level of secrecy that RAM councillor Robyn Hughes was told of the ARC's extraordinary share bid meeting too late to be able to attend. Nor was she informed about a briefing on the issue. I believe this was a political ambush of RAM's councillor because the secret faction feared she would oppose $170 million going into the stockmarket rather than public transport."

"RAM supports Robyn asking the High Court to judge if this procedure was illegal. We're sure that very interesting stuff will be uncovered during the legally mandated process of disclosure and interrogation preceeding the court hearing. The secret faction's actions had shut down democracy on the ARC to such an extent that a High Court review was the only option left open."

"Robyn tells RAM that she's still ready to listen to sensible suggestions about how to resolve the issue without a court hearing. Will the ARC take up Robyn's generous offer? Will the ARC hold the secret faction accountable for its undemocratic actions?"

During Grant Morgan's comments on the secret faction, ARC chair Mike Lee interjected twice to exclaim "Rubbish!"

"But when I asked the ARC chair if he'd like to debate the secret faction issue with me, he declined to do so," commented Grant Morgan.

However, Mike Lee did make one very interesting comment during a later submission by a delegation from Auckland Regional Holdings, the ARC subsidiary making the Ports of Auckland share bid.

The ARC chair said: "It's possible that Auckland will be hosting another America's Cup." (From Grant Morgan's minutes of the discussion.)

"Is the secret faction's desire to take over the 20% private shareholding in the ports company connected to the ARC chair's comment about Auckland possibly hosting another America's Cup?" asked Grant Morgan. "I call on the secret faction to reveal the real agenda behind their eagerness to play the stockmarket instead of funding public transport."

Grant Morgan's full submission to the ARC is printed below.

Verbal submission to ARC 24.5.05

RAM's core concerns are well-known to all ARC councillors:

FREE BUSES TRIAL
Humanity is facing the life-threatening catastrophes of global warming and oil depletion. Auckland's chronic congestion is a significant contributor to these looming crises.

If we are to be responsible global citizens, Auckland must become a public transport region. Auckland's transport fundamentals must be urgently shifted.

At the ARC, however, I detect few, if any, signs of urgency. The ARC's notions of risk management are woefully inadequate.

We need to declare war on traffic gridlock. We need an urgent circuit-breaker.

RAM is pushing for free and frequent buses to break gridlock, funded by a major shift of government funds away from roading projects.

Manukau City's transport committee supports RAM's free buses petition.

Sir Barry Curtis wants ARTA to run a large-scale free buses trial across three Manukau suburbs.

RAM asks the ARC to likewise endorse such a free buses trial. That would be showing visionary realism, instead of fiddling at the edges of gridlock. Is this council up to it?

EQUAL SHARES RATING POLICY
In RAM's view, business and homeowners should each pay 50% of total rate take. While business make up just 7% of total ratepayers, they benefit from the lion's share of ARC spending.

RAM's Equal Shares rating policy would require a business differential around 4. On average, it would deliver a 30% reduction in ARC home rates and an 85% rise in business rates.

This would go a fair way towards returning home rates to what they were before Gwen Bull's council savaged homeowners with hikes of up to 650%. This sparked an unprecedented Rates Revolt, as many ARC councillors hate to be reminded of.

The current council voted for a microscopic rise in the business differential from 1.5 to 1.6, which ARC chair Mike Lee conceded merely maintained the status quo set by Gwen Bull's council.

So wealthy corporates retain significant rate reductions at huge cost to grassroots homeowners.

RAM councillor Robyn Hughes was on her own as she advocated a differential of 4 in order to deliver an Equal Shares rating policy.

Many ARC councillors were elected on promises of 'fair rates', but then promoted a status quo 1.6 differential, or only slightly higher (1.7 or 2).

Why should RAM retain any confidence in these councillors? Can you convince us that you will seek major reductions in home rates?

CITIZEN's ASSEMBLIES
I believe that RAM's Equal Shares policy would be far more widely supported than the ARC's preferred rating policy. That would be easy for the ARC to check out.

Time after time, RAM has asked the ARC to convene a Citizen's Assembly so that rating policy could be discussed with and by a wide range of community representatives.

Such mass, interactive debate is light years away from the discredited concept of "public consultation", which most people dismiss as political propaganda and bureaucratic manipulation.

Corporate lobbyists exert an influence over the ARC out of all proportion to their numbers in society. We've got dollar democracy - not people's democracy.

Citizen's Assemblies would be a break with dollar democracy. They would promote participatory democracy.

Why then has this ARC, just like Gwen Bull's council, given a big yawn whenever Citizen's Assemblies are mentioned? Is it because this council has been captured by the same corporate lobbyists who exerted undue influence over Gwen Bull's ARC?

One way to disprove this question would be to convene Citizen's Assemblies around fundamental issues facing the ARC. Are you up to it?

SECRET FACTION
Recently there was a glaring example of what's wrong at the ARC. I refer to the process and agenda around the $170 million Ports of Auckland share bid by Auckland Regional Holdings, an ARC subsidiary.

Who decided that $170 million of public funds should be diverted into buying a 20% minority shareholding in a company already controlled by ARH/ARC?

Nobody campaigned on this policy in the last ARC election.

Nobody consulted the public on this massive diversion of funds away from public transport.

There wasn't even a debate within the full ARC over whether or not to consult the public.

Some ARC councillors were kept in the dark until the very end.

Some say there couldn't be consultation with the public, or even with councillors, because then PoA shares would rise in value. Only the truly naive could believe that fairytale.

ARH offered $8 for each PoA share. That put a 26% premium on shares which had been declining in value for quite a while. Stockbrokers say 26% was an unusually large premium.

Guess what? The day the offer was announced, PoA shares soared in value to $8 - exactly the share price offered.

Clearly, the share price was going to rise in value whether or not there was consultation.

So if commercial secrecy can't justify the lack of consultation, then what was the real motive? Was it to kneecap potential critics?

The $170 million deal was cooked up by a secretive, self-selected faction of ARC politicians and ARH bosses.

Among those kept in the dark by this secret faction were senior ARC officers, including ARC chief executive Peter Winder. ARC officers were prevented from giving independent advice to ARC councillors on the ARH share bid.

So here we have the ARC risking $170 million without first getting advice from its own officers. That is playing very fast and loose with public funds.

Such was the level of secrecy that Robyn Hughes was told of the ARC's extraordinary share bid meeting too late to be able to attend. Nor was she informed about a briefing on the issue.

I believe this was a political ambush of RAM's councillor because the secret faction feared she would oppose $170 million going into the stockmarket rather than public transport.

RAM supports Robyn asking the High Court to judge if this procedure was illegal. We're sure that very interesting stuff will be uncovered during the legally mandated process of disclosure and interrogation preceeding the court hearing.

The secret faction's actions had shut down democracy on the ARC to such an extent that a High Court review was the only option left open.

Robyn tells RAM that she's still ready to listen to sensible suggestions about how to resolve the issue without a court hearing. Will the ARC take up Robyn's generous offer? Will the ARC hold the secret faction accountable for its undemocratic actions?

RAM is also opposed to toll roads and to the government pushing liability for dirty dirt onto individual homeowners. Elaine West, in a later submission, will speak in more detail about RAM's position on these two issues.

Throughout this presentation I have raised a number of critical questions. I would be glad to discuss these questions with councillors now, and also at any future time.

END

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