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NZ Council sees no conflict in belonging to property body

Property Here - Monday, March 25, 2013

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Auckland Council has voted to stay in an organisation that calls itself the voice of commercial property - after rejecting pleas that citizens see a conflict of interest.

Councillor Sandra Coney asked the council to cancel its membership of the Property Council to avoid any public perception of bias in its decision-making.

Referring to court action taken by the Property Council to get the local body to revoke general tree protection rules, Ms Coney said none of the staff advisory reports on the matter mentioned the membership.

"So, what it means is that the council itself is involved in litigation with an organisation of which it is a member. That raises clearly an issue of conflict of interest or at least a perception of conflict of interest.

"It's not a good look."

Ms Coney said she couldn't see any advantage for the council in "being in the tent" with property developers.

Councillor Mike Lee said it was one thing to be a business-friendly council and another to be jumping into bed with business. "No one asked us about this and they should have."

Ms Coney's cancellation bid was lost five votes to 14 at a full council meeting on Thursday.

Council chief executive Doug McKay said he saw no reason to change the arrangement, which he had decided under delegated authority, as did managers of five council-controlled organisations.

Four former city councils had been members and the succeeding Auckland Council rejoined after negotiating a far less expensive fee. Council-controlled organisations had joined in 2011 for a nominal additional fee.

The total $47,000 annual fee offered effective networking connections with other property owners, helping to explain policy changes to major ratepayers and to improve returns on council holdings, he said.

Officers used events and workshops to increase their skills and knowledge of property management and investment. The council was free to disagree with policy positions and was not compromised as a regulator.

It frequently made regulatory decisions where it had other interests, for example when the council was considering whether to grant itself a resource consent. Auckland Council belonged to many other organisations that lobbied decision-makers.

Chief executive Connal Townsend said the Property Council existed to support owners, investors and managers of property, of which Auckland Council was one of the country's largest. The Property Council has 550 member companies.

Joining the Property Club

Auckland Council fees to Property Council
$47,000 total fee, comprising
$18,000 Auckland Council
$18,000 Auckland Council Properties Ltd
$2700 each for other council-controlled organisations