Best of the Week

A council’s wall of silence crumbles

Correspondence released to Newsroom suggests a Wellington firm held sway over a Christchurch council decision to fight five months to keep secret the cost of a digital touch wall for its new $93 million library. David Williams reports.

It was described as “interactive, immersive and exciting”.

A story in Christchurch’s The Press newspaper in January extolled the virtues of a seven-metre-wide digital touch wall for the city’s new $92 million central library, Tūranga.

The Wellington-based Taxpayers’ Union, a lobby group focused on flagrant public spending, saw it differently. The day the story appeared, it fired off questions to the Christchurch City Council, which would eventually spark a publicity storm when the Ombudsman forced the council to release the $1.245 million cost.

Internal city council emails, released to Newsroom under the Local Government Official Information and Meetings Act, show how closely the council consulted the wall’s supplier, Wellington firm Gibson Group. The council sought “approval” for a press statement and the company’s managing director, Brett Tompkins, added comments.

In a bizarre twist, later dismissed as “confusion”, a council legal adviser drafted a response to the Ombudsman on behalf of Mayor Lianne Dalziel.

The bungled response to the information request heaped pressure on a council already under fire for trying to keep quiet a cost blowout in the $152 million Christchurch Town Hall rebuild project. Residents have also grumbled about chlorination of drinking water and the council’s plans to vastly increase its debt.

Tight rationale

A week after the council received the Taxpayers’ Union demand for the wall’s cost, the council’s senior information adviser Sean Rainey asked managers to justify why the council would withhold it. “I only ask as if this goes to the Ombudsman we need to have our rationale tight.”

Alistair Pearson, the major facilities capital delivery manager, responded that it was Gibson Group’s first South Island project. “We have managed to attain a favourable price for the product and this is, of course, commercially sensitive to the supplier.”

When would the information be released? Pearson wrote: “Two years after the project is closed or never.” He asked Rainey to get legal advice, adding: “I believe we never release financials.”

The council officially responded to the Taxpayers’ Union, refusing to provide the cost, in late February. As suspected, it then complained to the Ombudsman, the independent arbiter of public information battles. The complaint said any firm dealing with public entities should expect transparency about costs.

“Gibson Group should have expected that information about its agreement with the council may well be subject to request.” – Leo Donnelly

As it was considering its response to the complaint, the council’s close relationship with Gibson Group became apparent. It was Gibson Group that initially raised concerns that releasing the wall’s cost would prejudice its commercial position. The council ran its draft response to the Ombudsman past the company.

The council’s response, written by Rainey and sent on April 24, said Gibson Group had only produced three such walls – in Denmark, the United States and Egypt – and it made a “concession” on price. “The price the council secured is unlikely to be commercially sustainable for the supplier and disclosure may affect the supplier’s ability to continue to offer its product in a way that is commercially viable both in New Zealand and internationally.”

Rainey wrote: “Once the library is completed, the council would be willing to discuss this further with the supplier.”

Ombudsman Leo Donnelly replied on May 3, with a provisional opinion that the council should disclose the wall’s cost. Successive ombudsmen have disclosed costs of service or goods, he said, and this had not deterred private sector entities from conducting business with them.

Gibson Group might have offered a discount but since, by its own admission, it had no competitors, and appeared to have a strong negotiating position with future buyers, Donnelly wrote. “Gibson Group should have expected that information about its agreement with the council may well be subject to request.”

How the inside of Christchurch's new central library might look. Image: Christchurch City Council

The council immediately discussed the finding with Gibson Group.

Adair Bruorton, chief adviser to chief executive Karleen Edwards, said the council would email managing director Tompkins “asking him for what we ‘need’ to support our response to the ombudsman”.

Tūranga project director John Rossetter – who’d kept Tompkins “in the loop”  – said the ombudsman made some reasonable points. “Brett [Tompkins] was aware from the outset that it was likely that we’d be asked for this information and whilst he would rather it were not disclosed he does understand that the council needs to be open and honest about these things.”

Transparency wasn’t Tompkins’ top priority, however. On May 10, he wrote to council boss Edwards saying that his company didn’t consider that any public benefit gained from learning the cost of its wall outweighed the commercial harm that would be done to Gibson Group and its sales negotiations.

“Release of the discounted Christchurch wall price would be detrimental to our position in these negotiations and could result in the US-based clients demanding the same price discount offered to Christchurch, an outcome that would severely affect the profitability of Gibson Group in this market”

The wall cost was less than 1.3 percent of the total library cost, Tompkins said. On its own, the figure “is not relevant to any public discussions”.

A fortnight later, council boss Edwards officially asked Donnelly to reconsider his provisional opinion, on the basis of Tompkins’ “quite compelling” evidence. She even stole one of his lines.

“It is the council’s view that given the fact that the cost of the digital and touch walls is less than 1.3 percent of the total cost of the new library, the public interest should not be regarded as being of greater value than the risk of harm to Gibson Group Ltd.”

Donnelly was unmoved. Worse, he basically gave the crucial information away in his decision, drawing a strong reaction from the council.

On May 31, Donnelly made a final recommendation that the council release the cost of the wall.

He said the substantial public interest in the costs of council services trumped Gibson Group’s commercial position. “It is not for Gibson Group to say that the cost of the walls is irrelevant to any public discussions about expenditure of council funds.” The council had until June 17 to respond.

But Donnelly had slipped up. His letter, copied to the Taxpayers Union, quoted Gibson Group as saying the walls cost less than 1.3 percent of the library’s total cost. On a total of $92.7 million, that’s roughly $1.2 million.

The game was up. Or was it?

Taxpayers’ Union communications officer Louis Houlbrooke tweeted on May 31: “The Ombudsman just upheld our complaint against @ChristchurchCC who refused to disclose the cost of their 7m ‘touch wall’.” But he didn’t mention the cost.

(Taxpayers’ Union executive director Jordan Williams tells Newsroom: “It actually seemed too good to be true, that they’d accidentally given it to us.”)

The council followed its usual pattern. “I’ll be forwarding this to GG [Gibson Group],” wrote Katie McFadden, senior adviser to Edwards. “We will not be releasing any information without first consulting them.”

Blocking continues

When the media started asking questions, the council correspondence revealed the pecking order of its crisis management. It was still not interested in releasing the information.

On June 1, a Friday, The Press asked for the cost to be released. Council staffer McFadden wrote to her senior colleague Bruorton, asking if the paper’s inquiry should be treated as an official information request, under LGOIMA. The alternative was to refuse to answer, she said, as the information was part of an ongoing investigation – the council was still within its statutory timeframe for responding to Donnelly.

Bruorton drafted two possible responses and asked for legal advice. Her lines appeared on page three of the newspaper the following day. The story referred to the 1.3 percent line, leaving readers with an easy calculation to work out the answer.

Yet council resistance to releasing the figure persisted.

That Friday afternoon, the council told The Press that Mayor Dalziel hadn’t been briefed by staff. Later that night she obviously knew about it, though – as did Gibson Group.

Mayor mortified over draft letter

Based on a discussion he had with Dalziel that Friday night, senior legal adviser Ian Thomson drafted a letter of response to the Ombudsman from the mayor. It  berated the office for effectively releasing the cost through its 1.3 percent comment. Thomson’s draft accused the Ombudsman of “inadvertently breaching the standards of confidentiality your office has set itself”.

Thomson sent a copy to Dalziel’s office on Tuesday, June 5. He added that the council would write separately about “the compromise suggested by the Gibson Group”.

It took the council’s media manager Jocelyn Ritchie three days to reply to Thomson about the letter “confusion”. She wrote that the mayor was “simply alerting you to the need for the chief executive to take on board the matter that she was discussing, which was the release of confidential information to the media”.

“The mayor is mortified that she may have created the impression that she wanted a letter drafted for her to send to the Ombudsman,” Ritchie wrote. “As she said to me herself, when asked to respond to questions from the media, not only would it be utterly inappropriate for her to comment on such a matter, it would create the impression that elected members can influence in any way the statutory obligations under LGOIMA.”

The matter was now “completely in your hands”, Ritchie said. Thomson said he and senior information adviser Rainey had already decided it was inappropriate for Dalziel to respond.

Compromise endorsed

The draft wasn’t wasted. Many of the lines originally prepared for Daziel would be refined and re-purposed – and signed by Edwards instead. The missive laid out, and endorsed, the Gibson Group compromise.

The council wanted to release the information after the library was opened. (The opening date, announced last week, is October 12.)

Edwards concluded: “Could you please confirm that releasing the information in this way will enable the council to comply with is obligation.”

On June 21, three days after he received Edwards’ letter, Donnelly responded, apologising for “the pre-emptive effect of my explanation”. He said that he couldn’t give any assurance about the Gibson Group’s suggestion.

While noting the council had a legal duty to observe his recommendation on the 21st day after it was issued, an Ombudsman “has not enforcement or other role”, he said. “It will be for the council to decide on the timing of its disclosure.”

Edwards interpreted that to mean the council could release the information in what it deemed to be a reasonable timeframe. It came as quite a shock when, a few weeks later, Chief Ombudsman Peter Boshier stepped in, spectacularly.

Crisis snowballs

On July 4, Boshier wrote to Edwards, noting the council hadn’t released the information nor responded to Donnelly’s June 21 letter. As a result, Boshier said, he was referring the council’s non-compliance to the Solicitor-General, “with a request that the Attorney-General consider the issuing of enforcement proceedings”.

That was mid-afternoon. Within 90 minutes, The Press contacted the council and – “unreasonably”, according to Edwards’ chief adviser, Bruorton – asked for comment within an hour. The Chief Ombudsman had told the paper he was “very disappointed” the council hadn’t respond to the recommendation.

Media manager Ritchie said Boshier’s comments were inconsistent with advice the council had previously received but the Press reporter insisted the story would run. Bruorton wrote: “The mayor may need forewarning of this.”

After The Press’s story went online, just before 7pm, head of libraries and information Carolyn Robertson wrote to other managers: “I think we will need to do further damage control with Brett and GG [Gibson Group].”

Bruorton said there was nothing the council could do “as the story’s out there”. “We need to talk to Gibson Group and just move ahead with releasing the figure I think.”

Spin doctors go to work

The next day, newspaper readers woke to the headline “Secrecy a ‘breach’ of public duty”. Yet the mood within the council offices brightened quickly.

Edwards spoke to Boshier – “positively”, Bruorton told council managers. The council would consult with Gibson Group and release the information on its website that day, Edwards said, and also share it with the Taxpayers’ Union. Boshier, meanwhile, promised to make a public statement affirming his confidence that the council had met its responsibilities.

Gibson Group should be called, Brourton told her colleagues, to be told the council needed to release the cost “but will be doing this in a positive manner”. Part of the plan was to publish the initial story “with no mention in it of the Ombudsman”.

(That’s exactly what happened. The tweet, sent at 3pm, said: “Unlike anything else in NZ, this virtual wall allows visitors to swipe their way through our city’s history.”)

Senior communications adviser James Richardson drafted a press statement for two council managers to review. “Once happy, we can supply to Gibson Group for their approval.” The statement quoted the head of libraries and information, Robertson, as saying: “With regard to the $1.2 million cost, it was always the council’s intention to release the figure – it was simply a question of timing.”

Gibson Group boss Tompkins approved the council statement, telling senior information adviser Rainey “I have added a couple of comments”. They were “nothing major”, Rainey said.

The screen supplier boss also passed to Rainey an email from a Newstalk ZB journalist. Rainey asked media manager Ritchie if the council should sit on the request until the media statement went out. “Basically it was our decision, not Gibson Group, although we listened to their concerns.”

“As soon as they’ve got the information it is available to the public, unless there’s good reason not to. And good reason ain’t when a ribbon-cutting is.” – Jordan Williams

Edwards’ chief adviser Bruorton drafted a statement for her boss “to follow any statement from the Ombudsman”. The statement said the chief executive took responsibility for council staff misunderstanding the “intent and course of action” required.

Boshier’s own statement, sent to the council half an hour before it was released publicly, said he welcomed the council’s decision to comply with its public duty under the law. “All agencies can expect firm action from me if the law is not complied with.”

Media manager Ritchie wrote to her colleagues: “I don’t think this is a very strong statement ... maybe we need to make ours a little stronger.”

The strongest statement, however, appeared in the next day’s Press newspaper. After defying calls to release the cost of the touch wall for five months, Taxpayers’ Union’s Williams accused the council of being “the most secretive council in the country”. It’s a claim he repeats to Newsroom, although he softens it, slightly, with the words “one of, if not”.

Williams scoffs at the council pushing the Gibson Group “compromise” of releasing the cost after the central library opening. The opening is totally irrelevant, he says. “As soon as they’ve got the information it is available to the public, unless there’s good reason not to. And good reason ain’t when a ribbon-cutting is.”

While accepting the council was within its rights to consult Gibson Group, Williams says it’s “totally inappropriate” for the company to be approving press statements. “The duties to release the information are on the council.”

The council provided an emailed statement in the name of chief executive Edwards. It says the council followed “what it considered to be its legal obligations”. The fact the council’s interpretation differed from that of Boshier “has already been acknowledged by chief executive Karleen Edwards”, the statement from Edwards says.

The council is not secretive, the statement says, and it intended to comply with the Ombudsman’s decision. “The council takes its obligations under the LGOIMA seriously and the principle of availability this act promotes. For the most part, the council provides information in response to thousands of requests each year, maintaining an open and transparent approach.”

Gibson Group’s Tompkins couldn’t be reached for comment.

We recently launched a crowdfunding campaign to sustain and expand LockerRoom, our section dedicated to covering New Zealand women in sport. We created LockerRoom to fill a gap in sports journalism, sharing inspirational, compelling and important stories that would otherwise go untold. To join our team as a supporter, simply click the red button.

Comments

Newsroom does not allow comments directly on this website. We invite all readers who wish to discuss a story or leave a comment to visit us on Twitter or Facebook. We also welcome your news tips and feedback via email: contact@newsroom.co.nz. Thank you.

PARTNERS