The three Ps

People, politics and patch protection have prevented Auckland from forging ahead. But input from leading business people on the latest action plan could make the difference. By Mark Revington

Imagine a city with two beautiful harbours, fantastic beaches, a great public transport system, good roads, easy access to an international airport, and a fast, efficient communications infrastructure. Sound like the Auckland you know? Yeah right.

The region has been bedevilled for decades by short-term planning and constant bickering among its politicians. As Auckland Chamber of Commerce chief executive Michael Barnett says, people, politics and patch protection are the three Ps that have held Auckland back more than anything else and the region’s vision only ever lasts as long as an election cycle.

It may be too much to ask to change that sort of culture in a short time but an unlikely coalition of business and local and central government came together this year with the aim of transforming Auckland into a world-class city.

The great and the good squashed into a room in the bowels of the Aotea Centre on October 6 for the launch of the Metro Project Action Plan. They included all the big names: Prime Minister Helen Clark, Minister for Economic Development Trevor Mallard, Auckland Issues Minister Judith Tizard, and Barnett, who also chairs the Auckland Regional Economic Development Forum.

It was too crowded, and a little dull, as these things often are, but the launch of the action plan spelled out five objectives to transform Auckland into a world-class city:

• Take effective and efficient action to transform Auckland’s economy.
• Develop world-class infrastructure and world-class urban centres.
• Transform Auckland into a world-class destination.
• Develop a skilled and responsive labour force.
• Increase Auckland’s business innovation and export strength.

It’s hard to find fault with the objectives. But how to achieve them? The action plan may yet suffer from at least one of the Ps. It’s being driven through the auspices of the Auckland Regional Council — and you don’t have to go back very far for evidence of a disconnect between the ARC and the region’s mayors. Take the letter of September 5 from the mayors of the four major cities in the region — North Shore, Waitakere, Auckland City and Manukau — to the prime minister, in which they spoke of support for a new regional political structure.

“In our opinion the structure, responsibilities and ‘modus operandi’ of the Auckland Regional Council is a problem and has an inhibitory effect,” they wrote. “The focus must be on a structure that removes the conflicting, confusing and overlapping responsibilities between the ARC and the TLAs [territorial local authorities] of Auckland.” Look back to 2004, when Dick Hubbard was still just a mayoral candidate calling for a super city council to unite the region. But, as a New Zealand Herald editorial pointed out, there already was one.

“It is called the Auckland Regional Council and it is charged with most of the tasks that all cities need in common. Yet, oddly enough, Aucklanders know precious little about it.

“A Herald-DigiPoll survey has found that nearly 90% of Aucklanders could not name one member of the regional council.”

Why should the Metro Project Action Plan be any different? Because the business community and politicians are getting together on this one.

But how do you go about transforming the economy and developing a world-class infrastructure?
Well, a decent power supply would be a good start, so Mighty River Power CEO Doug Heffernan is leading a project to develop an energy prospectus. And Don Huse, chief executive of Auckland International Airport, is in charge of making sure there is a decent link between the CBD and the international airport.

How about ensuring quick and efficient communication with the rest of the world? Ross Peat, the former managing director of Microsoft NZ, is responsible for a project to deliver fast regional broadband by December 2008. Current Microsoft NZ managing director Helen Robinson is leading the Metro Project’s business innovation and export objective.

Former Mainzeal CEO Peter Menzies, who sits on the government’s Growth and Innovation Advisory Board, is leading the charge to develop a skilled workforce. David McConnell — managing director of construction and property development giant McConnell, and a director of the Committee for Auckland — is charged with transforming Auckland into a world-class destination.

A cynic might say the business sector is there to keep the politicians honest but, in reality, these are people who have experience in making things happen and in delivering projects on time. And it’s in their interests to ensure Auckland grows to its full potential.

Ironically, Barnett, who includes regional councillor among his many hats, says the broad spectrum involved in getting the Metro Project Action Plan underway will help ensure its success. He has spent much of the past nine months drawing the plan together.

“From a brand perspective I think I was lucky because I wasn’t going out just with an ARC brand. I had mixed hats and people knew I did. There was the chamber of commerce thing, the Regional Economic Development Forum, which got put into place in July last year, and the four years spent working through the Auckland Regional Economic Strategy. Instead of just an ARC brand, there were enough fingerprints to give it something of a special nature.”

Work started on the Metro Project in December last year, under the auspices of Auckland Plus, the business unit of the ARC.

An international team of experts, all with experience in transforming city regions, visited Auckland earlier this year and drew up a comprehensive report. A Symposium for Auckland was held in May this year to consider the report and create the action plan. The Champions for Auckland group — a coalition of business and community leaders and politicians — was formed in July to help drive the plan.

Barnett had already sensed a mood for change.

“I started doing meetings around the region, where I was looking at infrastructure or looking at innovation or talking up people and skills, and I got a real sense that there was an appetite for change among people, a real sense of, ‘look, we want to make a difference but, can this be the last time? … Let’s not be the ones who looked at the Harbour Bridge and said it needed eight lanes then delivered four and it had to be extended later. Could we do the whole of the job this time?’

“We got to the symposium with a couple of hundred people, the review team presented their findings, and then we sat everyone down in groups at tables and they had to spend 40 minutes on key issues. What have we got, what do we want, and what do we have to do to get it? And the last ten minutes were about what were the four best things we could do to deliver.

“I had one leading businessman come up to me after the first 40 minutes and say ‘that was absolutely exhausting’. By the end of the day you could see light at the end of the tunnel. People realised that we were going to have something action based. It wasn’t going to be another strategic plan that got wrapped up in a sack and shoved behind the door.”

Worldwide, thriving cities are recognised as drivers of national economies. Cities that deliver high productivity rates, employment, wages and GDP per capita drive successful national economies.
Auckland’s challenge is not to compete with other New Zealand cities but to look to the major cities on Australia’s eastern seaboard, which are more productive and have GDP per capita around 15% higher than Auckland’s. Cities are a catalyst for growth, says the Committee for Auckland, which has combed the world for examples of successful city regions. In 2006 the World Bank ranked New Zealand second for ease of doing business, ahead of the US at number three and Australia at number eight, but in Auckland, wages and salaries are typically 20% to 30% lower than for similar work in Australia and up to 50% lower than in the US.

Where Auckland misses out in relation to Australian cities is that they can all rely on state funding raised through taxes. Local authorities in Auckland can only raise money through rates, which means some alliance with central government is needed for big-ticket items.

New Zealand needs a city of world-class status, according to Prime Minister Helen Clark, and, as part of its economic transformation agenda, her government is committed to ensuring Auckland fits that bill. To that end it has opened an Economic and Urban Development Office in Auckland, which aims to make Auckland’s views known in drawing up economic and urban development policy. It has committed to a $1.62 billion investment in Auckland transport. It says the Rugby World Cup in 2011 is a fantastic opportunity to get a clear focus on improving the region’s infrastructure.

But when Unlimited went to press, Finance Minister Michael Cullen, not formerly known for a warm attitude to Auckland, was talking up a national iconic stadium on the waterfront, while local politicians had been given just two weeks to plump for the waterfront vision or an upgraded Eden Park. It didn’t bode well for any urgency or clarity of vision as far as transforming Auckland went.

David McConnell favours some mix of private and public funding for any big-ticket items but says Auckland has to make the benefits of the deal pretty clear. McConnell’s brief is to turn Auckland into a world-class destination which, at first glance, looks like a glorified tourist strategy. McConnell is quick to put that to rest. Visitors bring scale to a city, he says. The more people who visit Auckland, the more people who want to eat out, visit galleries, go to musicals, spend money.

“The thing that really hit me was when this guy John Tabart, who is chief executive of the Melbourne Docklands Authority, was looking at performance indicators. What he found out was that the environments that really succeeded are driven by the number of visitors they get. He said he wanted around 20,000 people to live and work in the Melbourne Docklands project but he wanted 20 million visitors a year. That would provide economy of scale in terms of amenities.

“It interests me because the indirect goals are so powerful, like the number of amenities created in a city in response to a strong visitor market which are for the benefit of the people who live in that city. It adds a huge amount to lifestyle. And then the people making decisions around the locations of head offices, instead of looking at, say, Sydney, will want to stay here because it will be a great place to be so you’re keeping intellectual property and business here.”

But it’s not just about whiz-bang fast broadband or sorting out the traffic snarls. Michael Barnett says the main concerns of the 7,000-odd corporate members of the chamber of commerce would be traffic jams, a shortage of skilled labour and compliance costs.

“Stuff like broadband is quite sexy and makes sense, and you talk about a link from Auckland to the airport, it’s the beginning of taking Auckland to the world and bringing the world back to invest and do all those sorts of things, yet one of the areas where there is a huge amount of potential is in the area where we don’t need to ask for any more money and that’s people and skills.

“There are literally hundreds of initiatives out there around people and skills where there are tens of millions of dollars coming from local government and central government but there is no discussion between the agencies, no mapping of outputs and at the same time 1,000 kids a year are coming out of Manukau City schools not employer ready. If we took that money and got the agencies talking, and got some focus on how money should be spent, we would get a better result.”

Peter Menzies shares his view. His brief, to ensure a skilled workforce, is as much about the 20% of schools in the Auckland region which rank near the bottom of the OECD as anything else. If he can help students coming out of those schools be better prepared for the workforce, it will benefit the whole region. It’s been too easy for the business community to sit back and say schools should be delivering skilled would-be employees on the doorstep, says Menzies, instead of realising business is as much a part of the community as anyone else. At the same time, he’s not about to dictate what has to be done. Menzies is firmly of the ‘íf it ain’t broke, don’t fix it’ school and wants to establish what coordination is necessary and where the gaps are.

But as Barnett points out, there has to be a sense of urgency. Ask any business owner in the region their frustrations, and the reply is likely to be transport, labour shortages and compliance costs, says Barnett.

“It would be the same with any business community anywhere. If you asked if they wanted lower taxes, they’d say, ‘oh hell yeah’. If you offer to lower taxes, people always say yes. But if you said you could offer the right platform to do business in, a place that was easy to move around and where it was easy to find the right skilled people, that might be preferable to having lower taxes.

“I see that as part of the Metro Project. If we deliver, it will deliver an Auckland which has an international profile but also delivers the best environment in which to work, live and play. Where you can operate a business and be internationally competitive. Somewhere you’re not just a leader but a world leader.”

Bring it on.



Auckland’s secret weapon
Cometh the hour, cometh the man? It’s a bit cheeky to introduce Michael Barnett in this fashion but we are talking about a man who bought a hairy cattle beast to run on his 5.7ha south Auckland lifestyle block — on Trade Me.

“It was a Highland cow. My wife said I was a sucker but it wasn’t the usual brown. It was blackish, with orange around the ears.”

And the 57-year-old has been driving the Metro Project forward as much as anyone. He’s the guy who got his photo and the foreword in the front of the action plan publication, and, when he spoke at the launch, got up and said: “Today I’m not Michael Barnett, CEO or chairman. I am Michael Barnett; passionate Aucklander, father, husband, employer, ratepayer and hopeful citizen.”

It wasn’t a bad speech , but Barnett gets plenty of practice in his roles as chief executive of the Auckland Chamber of Commerce, regional councillor, and chairman of the Auckland Regional Economic Forum.

Barnett joined the chamber in 1983 after 19 years in the steel industry and became chief executive in 1992. Auckland business then, he remembers, was still suffering from the aftermath of the 1987 sharemarket crash.

“Auckland was in a recovery mode. It was one of the economies hit hardest, which was probably a reflection of the way we did things, and there was some huge mistrust of elements of business. When I look back, I think some of the things we were doing then, we are doing now. Our vision is as long as an election cycle. It’s all short term, immediate gain.”

From 1994 he spent six years on the Auckland Energy Consumer Trust, and was elected to the ARC in 2001. Graeme Hunt, in his history of the chamber, calls Barnett a passionate advocate for Auckland business, a tireless public speaker, and someone singled out to take a higher profile in Auckland’s public affairs.

So far he’s doing a pretty good job as the Metro Project’s not-so-secret weapon, so who knows what lies ahead? There’s obviously a need for some kind of new regional grouping to ensure the action plan objectives are carried out, and Barnett could be just the man to advance the business community’s interests.

He’s certainly got the energy. Barnett gets up four mornings a week at 4.45am and heads up the Southern Motorway to the gym at the Northern Club, and then to the chamber’s offices on Mayoral Drive.

In the weekends there’s the lifestyle block where he runs 50 sheep and four cattle, including the hairy Highland one. Barnett says the outdoor work helps ground him. There’s nothing like drenching lambs to bring him back to earth.



Who’s got issues?
“Good morning, Parliament. How can I help you?”

“Office of the Minister for Auckland Issues please.”

“Er ... who?”

“Minister for Auckland Issues.”

“Um ... [asks co-worker, comes back]. Do you mean the MP for Auckland?”

With a million Aucklanders vying for her attention for the last seven years, you’d think the Minister for Auckland Issues, Judith Tizard, would get more calls.

Every ministerial portfolio has a list of departments, Crown entities, other organisations, budgets and legislation that the minister is responsible for. Tizard doesn’t get any of these, but she does get a footnote:

‘1. This responsibility involves coordination with ministers on Auckland issues.’

And what does that mean? She describes her role as being the “eyes and ears” of government in Auckland and to bring Auckland’s concerns to its attention. Not through Cabinet, though; so far this year, she hasn’t produced any papers or reports for Cabinet on Auckland issues. With no staff to help her prepare papers and no department or ministry to fall back on, it doesn’t look like this is going to change anytime soon, either.

But never mind such paperwork. She provides “an Auckland voice and perspective to government discussions and policy development; identifies and progresses issues with the rele-vant portfolio ministers; meets with Auckland’s elected local govern-ment representatives, officials, and others who represent Auckland interests”. Her contribution is through influence and connections; it is subtle, yet direct, gently steering the government towards Auckland’s interests, right under the nose of the rest of New Zealand.

Whether it’s Tizard’s influence or not, that seems like where the government is heading. In the last budget, making Auckland “an internationally competitive city” was one of the government’s goals. Lest it be accused of not putting its money where its mouth is, it put $400 million on roads and $147 million on public transport. Tizard is also an associate minister of transport.

An inter-agency office has also been established in Auckland to strengthen the relationship with the city. Called the Government Economic and Urban Development Office (GEUDO), it’s comprised of the Ministries of Economic Development, Environment, Transport and the Department of Labour. It’ll focus on issues that are relevant to Auckland, and being in Auckland, it will give local government and businesses better access to central government.

On the other hand, you’re still welcome to call up Judith Tizard — though you might just want to ask for the Auckland MP.
Keith Ng