Finance and Performance Committee of the whole - Terms of Reference Ngā Ārahina Mahinga

Chair	Councillor MacDonald
Deputy Chair	Councillor Coker
Membership	The Mayor and all Councillors
Quorum	Half of the members if the number of members (including vacancies) is even, or a majority of members if the number of members (including vacancies) is odd
Meeting Cycle	Monthly
Reports To	Council

Delegations

The Council delegates to the Finance and Performance Committee authority to oversee and make decisions on:

Capital Programme and operational expenditure

· Monitoring the delivery of the Council’s Capital Programme and associated operational expenditure, including inquiring into any material discrepancies from planned expenditure.

· As may be necessary from time to time, approving amendments to the Capital Programme outside the Long-Term Plan or Annual Plan processes.

· Approving Capital Programme business and investment cases, and any associated operational expenditure, as agreed in the Council’s Long-Term Plan.

· Approving any capital or other carry forward requests and the use of operating surpluses as the case may be.

· Approving the procurement plans (where applicable), preferred supplier, and contracts for all capital expenditure where the value of the contract exceeds $15 Million (noting that the Committee may sub delegate authority for approval of the preferred supplier and /or contract to the Chief Executive provided the procurement plan strategy is followed).

· Approving the procurement plans (where applicable), preferred supplier, and contracts, for all operational expenditure where the value of the contract exceeds $10 Million (noting that the Committee may sub delegate authority for approval of the preferred supplier and/or contract to the Chief Executive provided the procurement plan strategy is followed).

Non-financial performance

· Reviewing the delivery of services under s17A.

· Amending levels of service targets, unless the decision is precluded under section 97 of the Local Government Act 2002.

· Exercising all of the Council's powers under section 17A of the Local Government Act 2002, relating to service delivery reviews and decisions not to undertake a review.

Council Controlled Organisations

· Monitoring the financial and non-financial performance of the Council and Council Controlled Organisations.

· Making governance decisions related to Council Controlled Organisations under sections 65 to 72 of the Local Government Act 2002.

· Exercising the Council’s powers directly as the shareholder, or through CCHL, or in respect of an entity (within the meaning of section 6(1) of the Local Government Act 2002) in relation to –

o (without limitation) the modification of constitutions and/or trust deeds, and other governance arrangements, granting shareholder approval of major transactions, appointing directors or trustees, and approving policies related to Council Controlled Organisations; and

o in relation to the approval of Statements of Intent and their modification (if any).

Development Contributions

· Exercising all of the Council's powers in relation to development contributions, other than those delegated to the Chief Executive and Council officers as set out in the Council's Delegations Register.

Property

· Purchasing or disposing of property where required for the delivery of the Capital Programme, in accordance with the Council’s Long-Term Plan, and where those acquisitions or disposals have not been delegated to another decision-making body of the Council or staff.

Loans and debt write-offs

· Approving debt write-offs where those debt write-offs are not delegated to staff.

· Approving amendments to loans, in accordance with the Council’s Long-Term Plan.

Insurance

· All insurance matters, including considering legal advice from the Council’s legal and other advisers, approving further actions relating to the issues, and authorising the taking of formal actions (Sub-delegated to the Insurance Subcommittee as per the Subcommittees Terms of Reference)

Annual Plan and Long Term Plan

· Provides oversight and monitors development of the Long Term Plan (LTP) and Annual Plan.

· Approves the appointment of the Chairperson and Deputy Chairperson of the External Advisory Group for the LTP 2021-31.

Submissions

· The Council delegates to the Committee authority:

· To consider and approve draft submissions on behalf of the Council on topics within its terms of reference. Where the timing of a consultation does not allow for consideration of a draft submission by the Council or relevant Committee, that the draft submission can be considered and approved on behalf of the Council.

Limitations

· The general delegations to this Committee exclude any specific decision-making powers that are delegated to a Community Board, another Committee of Council or Joint Committee. Delegations to staff are set out in the delegations register.

· The Council retains the authority to adopt policies, strategies and bylaws.

The following matters are prohibited from being subdelegated in accordance with LGA 2002 Schedule 7 Clause 32(1) :

· the power to make a rate; or

· the power to make a bylaw; or

· the power to borrow money, or purchase or dispose of assets, other than in accordance with the long-term plan; or

· the power to adopt a long-term plan, annual plan, or annual report; or

· the power to appoint a chief executive; or

· the power to adopt policies required to be adopted and consulted on under this Act in association with the long-term plan or developed for the purpose of the local governance statement; or

· the power to adopt a remuneration and employment policy.

Chairperson may refer urgent matters to the Council

As may be necessary from time to time, the Committee Chairperson is authorised to refer urgent matters to the Council for decision, where this Committee would ordinarily have considered the matter. In order to exercise this authority:

· The Committee Advisor must inform the Chairperson in writing the reasons why the referral is necessary

· The Chairperson must then respond to the Committee Advisor in writing with their decision.

· If the Chairperson agrees to refer the report to the Council, the Council may then assume decision making authority for that specific report.

Urgent matters referred from the Council

As may be necessary from time to time, the Mayor is authorised to refer urgent matters to this Committee for decision, where the Council would ordinarily have considered the matter, except for those matters listed in the limitations above.

In order to exercise this authority:

· The Council Secretary must inform the Mayor and Chief Executive in writing the reasons why the referral is necessary

· The Mayor and Chief Executive must then respond to the Council Secretary in writing with their decision.

If the Mayor and Chief Executive agrees to refer the report to the Committee, the Committee may then assume decision-making authority for that specific report.

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Finance and Performance Committee

Open Minutes

Date: Wednesday 25 September 2024

Time: 9.30 am

Venue: Council Chambers, Civic Offices,
53 Hereford Street, Christchurch

Present

Chairperson

Deputy Chairperson

Members

Councillor Sam MacDonald

Councillor Melanie Coker

Mayor Phil Mauger

Deputy Mayor Pauline Cotter

Councillor Kelly Barber

Councillor Celeste Donovan

Councillor Tyrone Fields

Councillor Tyla Harrison-Hunt

Councillor Victoria Henstock

Councillor Yani Johanson

Councillor Aaron Keown

Councillor Jake McLellan

Councillor Mark Peters

Councillor Tim Scandrett

Councillor Sara Templeton

Principal Advisor

Bede Carran

General Manager Finance, Risk & Performance / CFO

Tel: 941 8999

David Corlett

Democratic Services Advisor

941 5421

david.corlett@ccc.govt.nz

www.ccc.govt.nz

Part A Matters Requiring a Council Decision

Part B Reports for Information

Part C Decisions Under Delegation

Karakia Tīmatanga

The agenda was dealt with in the following order.

Mayor Mauger congratulated the St. Thomas of Canterbury College First XV Rugby League Team (The Saints) for their success at the national school championships for the second year in a row. The Head Boy made a brief speech in reply followed by a group photo with the Mayor and a song.

1. Apologies Ngā Whakapāha

Part C

Committee Resolved FPCO/2024/00047

That the apologies from Councillor Gough for absence, Deputy Mayor Cotter for partial absence, and Councillor Johanson for a possible early departure be accepted.

Councillor Moore was absent from the meeting and no apology was received.

Councillor MacDonald/Mayor Carried

2. Declarations of Interest Ngā Whakapuaki Aronga

Part B

Deputy Mayor Cotter and Councillor McLellan declared an interest in Public Excluded Item 14 -Changes to Ōtautahi Community Housing Trust Financial Security Agreements.

3. Confirmation of Previous Minutes Te Whakaāe o te hui o mua

Part C

Committee Resolved FPCO/2024/00048

That the minutes of the Finance and Performance Committee meeting held on Wednesday, 28 August 2024 be confirmed.

Councillor MacDonald/Councillor Henstock Carried

15. Resolution to Include Supplementary Report

Committee Resolved FPCO/2024/00049

That the reports be received and considered at the Finance and Performance Committee meeting on Wednesday, 25 September 2024.

Public Excluded Items

16. Insurance Update

Councillor MacDonald/Councillor Coker Carried

4. Public Forum Te Huinga Whānui

Part B

There were no public forum presentations.

5. Deputations by Appointment Ngā Huinga Whakaritenga

Part B

There were no deputations by appointment.

6. Presentation of Petitions Ngā Pākikitanga

Part B

There was no presentation of petitions.

Councillor Barber left the meeting at 9.48am and returned at 9.52am during consideration of Item 7.

Mayor Mauger left the meeting at 9.50am during consideration of Item 7.

7. Key Organisational Performance Results - August 2024

Committee Resolved FPCO/2024/00050

Officer Recommendation accepted without change

Part C

That the Finance and Performance Committee:

1. Receives the information in the Key Organisational Performance Results - August 2024 Report.

Councillor Harrison-Hunt/Councillor Scandrett Carried

Mayor Mauger returned to the meeting at 9.58am during consideration of Item 8.

8. Financial Performance Report - August 2024

Committee Resolved FPCO/2024/00051

Officer Recommendation accepted without change

Part C

That the Finance and Performance Committee:

1. Receives the information in the Financial Performance Report - August 2024 Report.

Councillor MacDonald/Councillor Henstock Carried

9. Capital Programme Performance Report August 2024

Committee Resolved FPCO/2024/00052

Officer Recommendation accepted without change

Part C

That the Finance and Performance Committee:

1. Receives the information in the Capital Programme Performance Report August 2024.

Mayor/Councillor McLellan Carried

Secretarial note: The Committee asked staff to look at the titles of projects and their descriptions to see if any changes need to be made to make it clearer what groups of works relate to each project.

10. Resolution to Exclude the Public Te whakataunga kaupare hunga tūmatanui

Committee Resolved FPCO/2024/00053

That at 10.10am the resolution to exclude the public set out on pages 110 to 112 of the agenda and pages 5 to 6 of the supplementary agenda be adopted.

Mayor/Councillor Harrison-Hunt Carried

The public were re-admitted to the meeting at 11.09am.

Karakia Whakamutunga

Meeting concluded at 11.09am.

CONFIRMED THIS 23^RD DAY OF OCTOBER 2024

Councillor Sam MacDonald

Chairperson

7. Procurement Policy: Alignment with United Nations Security Council Resolution 2334
Reference Te Tohutoro:	24/1650150
Responsible Officer(s) Te Pou Matua:	Luke Stevens, Head of Procurement & Contracts
Accountable ELT Member Pouwhakarae:	Bede Carran, General Manager Finance, Risk & Performance / Chief Financial Officer

1. Purpose and Origin of the Report Te Pūtake Pūrongo

1.1 The purpose of this report is to provide advice following presentations made during the Council’s public forum related to the ongoing Israel – Hamas conflict.

2. Officer Recommendations Ngā Tūtohu

That the Finance and Performance Committee:

1. Receives the information in the Procurement Policy: Alignment with United Nations Security Council Resolution 2334 Report.

2. Notes that the United Nations Security Council Resolution 2334 states that Israeli settlements in the occupied Palestine territory are illegal under international law.

3. Notes the advice received from the Ministry of Foreign Affairs and Trade to Environment Canterbury in relation to United Nations Security Council Resolution 2334 is included as Attachment A to this report.

4. Notes that the United Nations Human Rights Council has released a list of organisations trading with the illegal Israeli settlements on the West Bank of the Palestinian Territories as outlined in Attachment B to this report.

5. Notes that the Christchurch City Council does not currently do business with any organisations included on the United Nations Human Rights Council’s list.

6. Confirms the addition of the following language to the Council’s Procurement Policy to reflect its commitment to comply with United Nations Security Council Resolution 2334, with any exemption being approved by the Chief Executive:

a. “The Council will comply with UN Resolution 2334 and not contract with the list of companies identified by the United Nations Human Rights Council as being involved in the building or maintenance of illegal Israeli settlements. An organisation on the United Nations’ list will only be included on a procurement shortlist in exceptional circumstances and with the approval of the Chief Executive.”

7. Notes that staff are requested to bring back, for inclusion in the Letter of Expectations to Christchurch City Holdings Limited (CCHL), appropriate direction for CCHL and its subsidiaries to operate in a manner that is consistent with the guidance and advice provided by the New Zealand Ministry of Foreign Affairs and Trade in respect of New Zealand organisations international trade and business dealings.

3. Background/Context Te Horopaki

3.1 At the Council meeting on 5 June 2024 there were two presentations made during the public forum session related to the ongoing Israel – Hamas conflict, one from an individual and one from the organisation, Palestine Solidarity Network Aotearoa (PSNA). The PSNA requested that the Council consider two actions in support of the people of Gaza who are caught in the conflict. These were:

3.1.1 To decline to purchase goods and services from companies identified by the United Nations Human Rights Council (UNHRC) as being involved in the building or maintenance of illegal Israeli settlements on occupied Palestinian land; and

3.1.2 To request the Lyttelton Port Company (LPC) to withdraw port facilities from ZIM and/or any ancillary services chartered by or on behalf of ZIM.

3.2 There are two resolutions of the United Nations which touch on the issue raised by the PSNA. First, is the United Nations Security Council Resolution 2334 (UNSC 2334), and secondly, there is the United Nations Human Rights Council Resolution 31/36 (UNHRC 31/36).

UNSC 2334

3.3 UNSC 2334 deals with Israel’s settlement activities in occupied Palestinian Territories (oPT) and among other matters it:

· 1. Reaffirms that the establishment by Israel of settlements in the Palestinian territory occupied since 1967, including East Jerusalem, has no legal validity and constitutes a flagrant violation under international law and a major obstacle to the achievement of the two-State solution and a just, lasting and comprehensive peace;

· 2. Reiterates its demand that Israel immediately and completely cease settlement activities in the occupied Palestinian territory, including East Jerusalem....; and

· 5. Calls upon all States, bearing in mind paragraph 1 of this resolution, to distinguish, in their relevant dealings, between the territory of the State of Israel and the territories occupied since 1967 […]

3.4 UNSC 2334 was supported by the New Zealand government (New Zealand was a co-sponsor), which has distinguished the oPT from the territory State of Israel. In advice from the Ministry of Foreign Affairs and Trade (MFAT) to Environment Canterbury on how to manage compliance with UNSC 2334 it noted that ‘UNSC 2334 does not impose positive obligations on any UN Member State to implement sanctions against those involved in illegal Israel settlements in the oPT or to label products produced by Israeli settlements.’ (refer Appendix A).

3.5 In summary, this advice leaves the decisions up to the Council on how to comply while having regard to the New Zealand Government’s position on key international resolutions and agreements.

3.6 The Christchurch City Council also contacted the Office of the Auditor General (OAG) requesting whether his office had any specific advice or guidance on this matter. The OAG’s guidance is that this is a policy decision for the Council and it should consider general principles relevant to procurement by a public sector organisation. The general principles are that public sector organisations should procure their goods and services ethically and ensure their policies cover accountability, openness, value for money, lawfulness, fairness, and integrity. The guidance notes the Council should consider how to achieve value for money while also balancing a potential restriction of competition.

UNHRC 31/36

3.7 The United Nations Human Rights Council Resolution 31/36 seeks to give effect to UNSC 2334 by increasing transparency and accountability in respect of business and trade dealings with Israeli entities in the oPT. UNHRC 31/36 urges UN Member States to provide guidance to individuals and businesses on the financial, reputational and legal risks of becoming involved in settlement related activities. UNHRC 31/36 led to establishment of a database of organisations involved in specific activities related to Israeli settlements (refer Attachment B for a current list of entities).

3.8 The Council does not procure any goods or services from entities listed in Attachment B nor is it trading with any of the listed entities. However, the Council has in the past dealt with subsidiaries of entities listed in Attachment B (these dealings came to an end at 30 June 2024 independently of this matter informing the Council’s Procurement Policy).

3.9 The Council can give effect to the UNSC 2334 by amending its Procurement Policy to include a review for the listed companies before short listing vendors for tendered procurements. Administratively it would operate by the procurement team referring to the relevant list at the time of a tender to ensure no organisations are short listed for consideration. Departures from this could only occur in exceptional circumstances and with the approval of the Chief Executive. The wording below would give effect to the proposed change:

“The Council will comply with UN Resolution 2334 and not contract with the list of companies identified by the United Nations Human Rights Council (Resolution 31/36) as being involved in the building or maintenance of illegal Israeli settlements. An organisation on the United Nations’ list will only be included on a procurement shortlist in exceptional circumstances and with the approval of the Chief Executive.”

3.10 In respect of the list of organisations listed by the UNHRC it should be noted that:

· The United Nations has been clear that the list is not comprehensive or up to date as they lack the resourcing to effectively maintain it.

· The remaining 97 companies on the list are not based in the Israeli settlements but are conducting business with people/organisations within the settlements; 13 are international companies and the balance are Israeli organisations.

1. Lyttelton Port Company Ltd

3.11 The PSNA also asked the Council to request the Lyttelton Port Company (LPC) to withdraw its port facilities from ZIM and/or any ancillary services chartered by or on behalf of ZIM (ZIM is an Israeli cargo shipping company, however, it does not currently appear on the UNHRC list). While LPC is a council controlled trading organisation, it has an independent board of directors who are responsible for its governance and oversee management to protect the interest of its shareholder and stakeholders. The separation of LPC’s operational activities from the Council as its ultimate shareholder means there is limited ability for the Council to instruct LPC on how it should manage its operations.

3.12 Through its Letter of Expectations with Christchurch City Holdings Ltd (CCHL) and CCHL’s Statement of Intent, there is an expectation that CCHL, and its subsidiaries, will exercise contemporary best practice governance in New Zealand. This expectation requires all of the Council’s subsidiaries to act ethically and in accordance with the standards expected of an organisation which is owned by a public benefit entity. This will include a CCTO such as LPC being acquainted with and cognisant of its obligations to ensure it is not in breach of UNSC 2334 and UNHRC 31/36. It is incumbent on LPC to assess how best it discharges these obligations.

4. Cost, Compliance, and Communication

Financial Implications

4.1 There are no specific financial costs to implement this policy amendment to the Council’s Procurement Policy. As noted below, it is possible that this amendment may reduce the Council’s opportunities to obtain the most competitive bid in a procurement process. At present the Council does not trade with any of the entities listed in the UNHRC 31/36.

Risk Assessment and Legal Compliance

4.2 The Council does not currently trade with any of the organisations included on the list created pursuant to UNHRC 31/36 and related to UNSC 2334. However, there is a risk that in the future excluding an organisation may result in increased financial costs and/or the inability to access innovative technology, approaches etc. This is the essence of the guidance from the OAG and notes it is for the Council to consider this when considering its obligations to act ethically and obtain value for money.

Engagement, Significance and Māori Participation

4.3 The matters noted in this report do not involve a significant matter in relation to ancestral land, a body of water or other elements of intrinsic value, therefore the items noted do not specifically impact Mana Whenua, their culture, and traditions.

4.4 The matters noted in this report will not impact on our agreed partnership priorities with Ngā Papatipu Rūnanga.

Consistency with Council Policy

4.5 The proposal is to amend the current Procurement Policy to give effect to UNSC 2334 and UNHRC 31/36.

Climate Change Impacts

4.6 The maters noted in this report are unlikely to contribute significantly to adaptation to the impacts of climate change or emissions reductions.

Communication

4.7 Once the amendment to the Procurement Policy is implemented the existing procurement training will be modified to include an explanation of the application of UNSC 2334.

5. Considerations Ngā Whai Whakaaro

5.1 The revised Procurement Policy will be publicised on the Council’s internal ‘Puna’ intranet site and applied to future tender responses.

Attachments Ngā Tāpirihanga

No.	Title	Reference	Page
a ⇩	MFAT Advice to Environment Canterbury on Israeli organisations in the oPT	24/1652187	18
b ⇩	United Nations list of companies trading with illegal Israeli Settlements	24/1652186	20

In addition to the attached documents, the following background information is available:

Document Name – Location / File Link

Not applicable

Signatories Ngā Kaiwaitohu

Author	Luke Stevens - Head of Procurement & Contracts
Approved By	Bede Carran - General Manager Finance, Risk & Performance / Chief Financial Officer

8. Key Organisational Performance Results - September 2024
Reference Te Tohutoro:	24/1763634
Responsible Officer(s) Te Pou Matua:	Peter Ryan, Head of Corporate Planning & Performance Peter.Ryan@ccc.govt.nz
Accountable ELT Member Pouwhakarae:	Bede Carran, General Manager Finance, Risk & Performance / Chief Financial Officer

1. Purpose and Origin of the Report Te Pūtake Pūrongo

1.1 To provide Council with an overview of performance towards delivering year one of our Long-term Plan 2024-34 (LTP), our ‘contract with the community.’

2. Officer Recommendations Ngā Tūtohu

That the Finance and Performance Committee:

1. Receives the information in the Key Organisational Performance Results - September 2024 Report.

2. To account for the known delay in the opening of Parakiore Recreation and Sports Centre, notes a single level of service target change for Recreation & Sport facilities, moving from 40 to 39 facilities available for use, to take immediate effect.

3. Background/Context Te Horopaki

3.1 This is a regular report focused on a suite of the ‘vital few’ organisational performance targets and forms a key component of the Performance Framework and its reporting.

3.2 Levels of service (LOS) are now in consolidated format, which means that exceptions are put in perspective against those performance measures that are on track. This report, as well as all supporting activity reports, have been extensively reworked to achieve this.

4. Considerations Ngā Whai Whakaaro

4.1 The key organisational performance targets include:

· Service Delivery (levels of service)

· Capital Projects (both delivery and planning)

· Value for Money (finance – activity budgets and capex)

4.2 This report provides September monthly performance forecasts to ELT targets for the LTP 2024-34.

4.3 Overall organisational performance priority forecasts are mixed but show improvement.

4.4 Community Level of Service delivery (83.9%) sees an improvement of 4.2% from August. Level of Service performance remains forecast just below ELTs performance target (85%).

4.5 Management Level of Service delivery (85.3%) saw an improvement of 4.9% from August. Level of Service performance is now forecast just above the ELT performance target (85%).

4.6 Included below in Section 6 are responses to questions about Service Delivery exceptions raised by Councillors at the previous meeting of 25 September 2024.

4.7 Capital Project milestone delivery (84%) saw a minimal decline of 0.1% from August. Capital Programme milestone delivery remains marginally below the ELT target (85%).

4.8 Capital planning performance forecasts both show good progress for this time of year, against the ELT targets of 90%.

4.9 Funding programme budgets allocated for FY2026 by 31st March 2025 are currently reported at 79.2%.

4.10 Budget drawdowns for FY2027 and 2028 by 30th June 2025 are currently reported at 77.4%.

4.11 Activity budgets, actively managed to budget (89.7%), saw a decline of 2.6% (one activity) from August. Activity budgets, actively managed to budget remains below the target set by ELT (100%).

4.12 Deliver Capital Programme within approved budget (-$37.3M), saw an increased forecast underspend of -$0.2M from August. Deliver Capital Programme within approved budget remains within the ELT target (=/< $0).

5. Service Delivery

5.1 Community Level of Service delivery (83.9%), Level of Service performance remains below the ELT performance target (85%). In August recommended management actions were introduced, and all LOS were reported which contributed to the 4.2% increase in forecast for September.

5.2 Management LOS delivery (85.3%), Level of Service performance now forecast just above the ELT performance target (85%).

5.3 Service delivery forecast improvements between August and September arise from improved business focus on ELT performance targets and identified exceptions, comments and remedial actions, and that all levels of service now have year-end forecasts.

5.4 The committee is asked to note one level of service target change. This relates to the Recreation, Sports, Community Arts and Events activity, LOS 7.0.1.1 Recreation & Sports facilities are available for use. The change of target is from 40 to 39 facilities available for use, to be applied to the current year, FY24/25. This change is to account for the known delay in the opening of Parakiore Recreation and Sports Centre. The Head of Service has flagged this LOS as an exception (red, will not be met) in both the August and current months’ performance reporting.

5.5 Recent updates to Council, including, among others, the Capital Programme Performance Report August 2024, advised that Rau Paenga provided an update that the construction completion date will be July 2025. There will then be a three-month commissioning process after which Parakiore should open its doors to the public in October 2025 (FY25/26).

5.6 This information has been communicated publicly: Parakiore-coming-together-year-go

5.7 Future months Performance Reporting (from October period onwards) will report against the adjusted target, and this target change will be specifically noted in the Annual Report 2025.

5.8 In line with the standing Audit and Risk Management Committee (ARMC) request all LOS that did not meet the previous year will continue to be reported as an amber exception until evidence is provided that the target will or has been met.

5.9 The scatter-diagram below (Attachment A) shows forecast activity LOS delivery performance (Community and Management LOS), against forecast activity budget performance (over- or under-spend).

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· Activities variously report level of service delivery forecasts ranging from 48.1% to 100% achievement, while almost all activities are presently forecast on budget.

· The vertical y-axis shows forecast service delivery (LOS) performance.

· The horizontal x-axis shows forecast budget over/underspend (scaled to relative budget).

5.10 The updated view of Service Delivery exceptions is attached to this report (Attachment B). It is:

· a visual summary of activity overall service delivery and activity budget performance,

· underpinned by a more granular LOS summary across the activity, before

· listing specific exceptions detail and business commentary.

5.11 Two activities are specifically noted in this analysis:

· Wastewater collection, treatment and disposal

· Stormwater Drainage

5.12 A snapshot of key wastewater collection, treatment and disposal metrics are presented below:

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5.13 A range of Service Delivery exceptions have been identified for Wastewater Collection, Treatment and Disposal. The exceptions raise concerns about:

5.14 Wastewater assets:

· Percentage of wastewater mains with high or very high consequences of failure inspected.

· 10 year rolling historic ratio of renewals to depreciation (pipe reticulation).

· Increase Wastewater Asset Management Maturity towards agreed, appropriate level.

5.15 Council wastewater networks and operations are sustainable - Christchurch Wastewater Treatment Plant (also see financial comments below, 5.18):

· Power consumption - kWh of electricity at the Christchurch wastewater treatment plant

· per cubic metre wastewater treated.

· per kilogram of chemical oxygen demand (COD) removed.

· Proportion of electricity used at the Christchurch wastewater treatment plant that is self-generated from treatment by-products.

· Proportion of biosolids diverted from landfill (beneficially reused).

5.16 Council operates wastewater services in a responsive manner:

· Time (in hours) from notification to arrival on-site for urgent faults on rural wastewater networks.

5.17 Appropriate comments and remedial actions are provided by the business (refer Attachment B). All service delivery exceptions are Management measures, which will not affect the Annual Report 2025.

5.18 Financially, the activity is forecasting a spend of $2.3m more than budgeted, made up of:

· an increase in personnel costs, forecast to be $1.2m over budget due to insufficient budget for salaries & wages and overtime.

· operating costs forecast to increase by $1.1m to reflect the increased costs of the activated sludge process operating at Christchurch Wastewater Treatment Plant.

5.19 In respect of Stormwater Drainage a snapshot of key metrics are presented below:

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5.20 A range of Service Delivery exceptions have been identified for Stormwater Drainage. The exceptions raise concerns about:

5.21 Stormwater network is managed to minimise risk of flooding, damage, and disruption

· Percentage of stormwater mains with high or very high consequences of failure inspected as scheduled.

· Percentage of waterways linings at condition grade 5 (poor).

5.22 Council manages the stormwater network in a responsible and sustainable manner

· 10yr rolling historic ratio of renewals to depreciation - If all projects are delivered this year the target will be met.

· Increase Land Drainage Asset Management Maturity towards agreed appropriate level.

5.23 Reduce pollution of waterbodies and waterways from contaminants stemming from urban, stormwater and/or industrial discharge

· Annual rolling average reduction in the discharge of zinc/copper/Total Suspended Solids.

5.24 Appropriate comments and remedial actions are provided by the business, refer Attachment B. Again, all service delivery exceptions are Management measures, which will not affect the Annual Report 2025.

5.25 Financially, maintenance costs forecast to be $1.6m more than budget due to higher seasonal reactive maintenance.

6. Responses to questions from Councillors

6.1 At the committee meeting of 25 September 2024 Councillors asked questions about several Service Delivery exceptions. The following responses are provided:

6.2 Activity: Ōtākaro Avon River Corridor - questions from Cllrs Harrison-Hunt and Henstock.

6.2.1 Councillors asked questions about the overall forecast performance for the Ōtākaro Avon River Corridor activity (part of a summary table on agenda p18, with activity summary and exceptions p52).

6.2.2 Staff response from acting Head of Parks, Rupert Bool.

6.2.3 The Ōtākaro Avon River Corridor activity focuses on implementation of the core objectives of the Ōtākaro Avon River Corridor Regeneration Plan across Parks, 3 Waters and Transport’s activities in a cost-effective, ecologically sensitive and culturally competent manner. These objectives focus on a restored deltaic river environment with enhanced mahinga kai outcomes that provides improved recreational and cultural experiences.

6.2.4 For August several levels of service were not reported due to incomplete data, leading to the summary activity forecast of 29%. This gap in data completeness has now been addressed, with the anticipated forecast for September period at 86%.

6.2.5 Ongoing, the levels of service provide monitoring and assurance that:

· an effective, permanent co-governance structure is operational,

· approved work programmes are delivered in the year they are funded, including

· alignment of Council and community resources to enable successful implementation, and

· the maintenance plan key performance indicators are achieved.

6.3 Activity: Water Supply - questions from Cllr Johanson.

6.3.1 Cllr Johanson asked questions about the Water Supply level of service exception 12.0.7 Average consumption of drinking water (data unavailable) (agenda p26);

· to confirm reporting data will be available from September period onwards;

· to provide trends; and

· to clarify whether water meter charging is impacted by the data being unavailable.

6.3.2 Staff response from acting Head of Three Waters, Gavin Hutchison.

6.3.3 Confirm reporting data will be available from September period onwards. The data is available and will be in the future reports.

6.3.4 Provide trends. Trend results for the last 3 years as follows:

· Year-end June 2024: 298 litres per resident per day average use (against the target of <=210)

· Year-end June 2023: 261 litres per resident per day average use (against the target of <=215)

· Year-end June 2022: 278 litres per resident per day average use (against the target of <=220)

6.3.5 Clarify whether water meter charging is impacted by the data being unavailable. Water metering charging is not impacted. Reporting for this LOS does not use water meter data.

6.4 Activity: Building Regulation - questions from Cllr Harrison-Hunt.

6.4.1 Cllr Harrison-Hunt asked questions about the overall forecast performance for the Building Regulation activity, forecast performance 64% - what is behind this? (agenda p18). There were also questions for specific level of service exceptions:

· LOS 9.1.12 building inspections - where are contractors coming from (out of city?), and what additional costs are incurred when using these contractors? (agenda p61)

· LOS 9.1.4 building consent process satisfaction - provide information about the end-to-end customer experience project. (agenda p61)

6.4.2 Staff response from Head of Building Consenting, Steffan Thomas. (The HoS is not able to attend the committee meeting in person as involved in pre-scheduled appointment.)

6.4.3 What’s behind this? As at August five levels of service were flagged as exceptions. This was due to higher demand for these services. As at September two of these are now meeting targets. The remaining three (Inspections, Issuing Code Compliance Certificates and Granting Consents) are all showing steady month by month improvement and are currently sitting at around 90% (targets variously between 95%-98%, as noted in the LOS Exceptions report).

6.4.4 Where are contractors coming from/additional costs? Contractors used for both processing of consents and inspections are being sourced locally (from Christchurch) and from Tauranga. Contractors are used sparingly to meet statutory timeframes in periods of peak applications/ inspections. Residents are charged the same for contractors as internal staff, although contractors do come with an additional cost.

6.4.5 Information about the end-to-end customer experience project. This project is making a number of small changes throughout the building consenting process to increase the experience for customers. The first part of this has been to understand how customers use our website and how we can improve the information available to them. Many of these are quick wins but will have a big impact on the customer experience. More information on this will be provided in the Building Consenting quarterly report to Council

6.5 Activity: Stormwater Drainage Asset Management Maturity Assessment (AMMA) – questions from Cllr Johanson.

6.5.1 Cllr Johanson asked questions regarding level of service exception 14.0.15.3 Land Drainage Asset Management Maturity (agenda p40).

· When is the next assessment to be available?

· What is the plan to provide an update to Council on progress towards improvement?

6.5.2 Given the questions the response has been broadened to encompass all asset classes involved in the Asset Management Maturity Assessment (AMMA) process.

6.5.3 Staff response from Head of Strategic Policy and Resilience, David Griffiths, and Team Leader Strategic Asset Management, Paul McKeefry. (Neither manager can attend the committee meeting in person as involved in pre-scheduled training course.)

6.5.4 The next Asset Management Maturity Assessment is planned for the 2026 Calendar Year. This will be in time to inform development of the LTP 2027-37.

6.5.5 An update to the Finance & Performance Committee on the current Asset Management Improvement Programme (AMIP) is set for 26 February 2025. The report will provide an update on the progress of the organisational wide Asset Management Improvement Programme that is aligned to the LTP 2024-2034.

6.6 Annual Plan 2025/26 - how to submit a question related to the AP2025/26.

6.6.1 The process remains the same as with the LTP2024-34 where elected members can submit question using the Q&A tool, as advised in a separate email.

6.6.2 When a question is submitted you will receive an email notification confirming your question has been logged and will receive another when your question has received a staff response.

6.6.3 Responses are then available to all Councillors and staff through a dashboard (including questions and responses from previous planning processes, e.g., LTP24).

7. Capital Projects – Delivery and Planning

7.1 Capital project milestone delivery performance is forecasting 84.0%, remaining stable from August (a small 0.1% decline). This remains forecast below the ELT target of 85%.

7.2 The capital delivery target relates to projects Council is responsible for delivering, including Council-funded and externally funded projects.

7.3 Capital planning performance forecasts both show good progress for this time of year, against the ELT target of 90%.

· Funding programme budgets allocated for FY2026 by 31st March 2025 currently at 79.2%.

· Budget drawdowns for FY2027 and 2028 by 30th June 2025 is currently at 77.4%.

7.4 For further information and underlying project detail, refer to the Capital Programme Performance Report.

8. Value for Money

8.1 89.7% of activities are forecast to meet budget (nett controllable cost, after carry-forwards), against the ELT target 100%. 35 of the 39 activities are forecast on budget.

8.1.1 To align with changes to the performance target definition, management processes and systems are being refined to enable inclusion of relevant activity manager financial comments.

8.2 For more information refer to Attachments A & B and to the Financial Performance Report.

8.3 Overall capital programme budget expenditure is forecast at -$37.3m, against ELT’s target of within approved budget (= < $0). This applies a consistent PMO forecast of $510m against the current programme of $547.3m, approx. -6.8%. The forecast includes core and externally funded work but excludes One New Zealand Stadium at Te Kaha.

8.4 More detailed information is available in the Capital Programme Performance Report.

A graph of a cost of delivery

Description automatically generated with medium confidence

8.5 The forward view of capital delivery performance (financial) looks at commitments for the first three years of the LTP 2024-34, accompanied by confirmed capital delivery in preceding LTP-cycles against plan.

8.6 This view takes into account revised year-end budget delivery figures for 2023/24, and the adopted capital programme from the LTP 2024-34 (approved future years planned expenditure for 2024/25, 2025/26 and 2026/27).

8.7 The extended black line is the full planned delivery budget including One New Zealand Stadium at Te Kaha.

8.8 The extended blue line shows the full Council planned delivery budget (excluding One New Zealand Stadium at Te Kaha, and before any confirmed carry forwards):

· from a consistent $488m to $483m planned budget for the three years (2021-24);

· to between $548m to $668m planned budget for the future three years (2024-27).

8.9 It is accepted these future planned delivery budgets for capital meet Council’s expectations as being both deliverable and affordable.

8.10 Currently, Council capital delivery (green line) for 2024/25 (year one of the LTP 2024) is forecast at $510m against the current programme budget of $547m (blue line). This equates to -$37.3m, or 93.2% forecast delivery.

8.11 This forecast delivery value is in line with the year-end actual value for 2023/24, $502m.

8.12 The ELT performance goal for capital delivery is based on all delivery Council is accountable for (excluding One New Zealand Stadium at Te Kaha), regardless of funding source.

8.13 Figures align with the Financial and Capital Programme Performance reports.

Attachments Ngā Tāpirihanga

No.	Title	Reference	Page
a ⇩	Top Activities (service delivery and budget)	24/1784922	36
b ⇩	Service delivery (level of service) exceptions	24/1792435	38

In addition to the attached documents, the following background information is available:

Document Name – Location / File Link

Not applicable

Signatories Ngā Kaiwaitohu

Authors

Boyd Kedzlie - Senior Corporate Planning & Performance Analyst

Amber Tait - Performance Analyst

Approved By

Peter Ryan - Head of Corporate Planning & Performance

Bede Carran - General Manager Finance, Risk & Performance / Chief Financial Officer

9. Financial Performance Report - September 2024
Reference Te Tohutoro:	24/1670093
Responsible Officer(s) Te Pou Matua:	Russell Holden, Head of Finance
Accountable ELT Member Pouwhakarae:	Bede Carran, General Manager Finance, Risk & Performance / Chief Financial Officer

1. Purpose and Origin of the Report Te Pūtake Pūrongo

1.1 The purpose of this report is for the Finance and Performance Committee to be updated on Council's financial performance to 30 September 2024 including the current year forecast, and to receive information on treasury compliance and general insurance claims.

1.2 This is a regular monthly report that is presented to the Committee.

2. Officer Recommendations Ngā Tūtohu

That the Finance and Performance Committee:

1. Receives the information in the Financial Performance Report - September 2024 Report.

3. Executive Summary

3.1 The year-to-date operational deficit of $22.2m is $15.6m lower than budget year to date, arising from savings in insurance costs, reduced personnel costs due to staff vacancies and lower than budgeted solid waste recycling / organics processing fees.

3.2 The forecast operating surplus for the year is currently $10.2m, an improvement of $0.8m from the August forecast. The improvement has primarily been driven by Building and Planning consent fees from higher consent applications, although these are largely offset by higher related costs. Other forecast cost changes show a concerning deterioration in Three Waters.

3.3 The capital programme delivery is close to budget for the first quarter. The total capital programme, before signalled carry forwards, is forecast to be under spent by $31.5 million. This comprises a forecast under spend of $37.6 million on the core/external funded programme and a forecast overspend of $6.1 million on the One New Zealand Stadium at Te Kaha. Both variances will be managed via carry forward / bring back requests.

3.4 All treasury risk positions are within policy limits.

4. Operating Forecast

4.1 The forecast operating surplus for the year is currently $10.2m, an improvement of $0.8m from the August forecast. The improvement has primarily been driven by Building and Planning consent volumes, although these are largely offset by higher related costs. Other forecast cost changes show a concerning deterioration in Stormwater and Wastewater, partly offset by a material improvement in Solid Waste along with lower Insurance and Rates costs (on Council’s own properties which are budgeted for).

5. Operational Revenue and Expenditure

5.1 This covers day to day spend on staffing, operations and maintenance, and revenues to fund the operational spend.

5.2 Operational revenue exceeds expenditure as it includes rates revenue for capital renewals and debt repayment. This ‘capital’ revenue is referred to below as ‘Funds not available for Opex’ and is removed to show the year to date and forecast operational surplus or deficit.

	Year to Date Results			Forecast Year End Results			After Carry Forwards
$m	Actual	Budget	Var	Forecast	Budget	Var	Carry Fwd	Var
Revenues	(254.2)	(252.8)	1.4	(1,084.4)	(1.078.6)	5.8	-	5.8
Expenditure	210.2	232.8	22.6	822.4	827.2	4.8	-	4.8
Funds not available for Opex	66.2	57.8	(8.4)	251.8	251.4	(0.4)	-	(0.4)
Operating (Surplus)/Deficit	22.2	37.8	15.6	(10.2)	-	10.2	-	10.2

5.3 Brief summaries of material revenue and expenditure variances are highlighted below.

5.4 Revenues are $1.4 million ahead of budget year to date and are forecast to be $5.8 million higher at year end. Key drivers of actual and forecast variances to budget include (amounts in parentheses are revenues below budget against year to date amounts):

Variance	YTD	Forecast (after c/f)
Building & Planning consent volumes	1.2m	2.9m
Rates overstrike	(0.2m)	1.0m
Otautahi Community Housing Trust (OCHT) revenues	(0.2m)	0.7m
Transwaste dividend	-	0.4m
Recreation & Sports pools and fitness centres increased participation	0.7m	0.3m
Hagley Park parking fees – installation of new parking metres not yet in place.	(0.5m)	(0.7m)
Other revenues	0.4m	1.2m
Total	1.4m	5.8m

5.5 A rates overstrike arises as Council needs to estimate the total number of rating units, for the purpose of the rates resolution, prior to receiving final confirmation from QV on the total number of rating units. Accordingly, Council does not have a confirmed number and is required to estimate the number of rating units and their distribution, e.g. between residential and commercial.

5.6 Expenditure is $22.6 million lower than budget year to date and forecast to be $4.8 million under budget at year end. Key drivers of actual and forecast variances to budget include:

Variance	YTD	Forecast (after c/f)
Insurance costs	7.9m	7.9m
Solid Waste & Resource Recovery lower recycling processing fees and organic processing fees	2.6m	2.3m
Personnel Costs (Annual increases not yet applied, units with vacancies which were planned to be filled e.g. Parks In-house maintenance team)	4.4m	1.2m
Rates on Council owned properties	0.1m	1.0m
Christchurch Cathedral grant unpaid (due to Council decision, and pause in construction on Christchurch Cathedral)	7.0m	-
OCHT Community Housing increased operating and maintenance costs (partially offset by increased revenue)	0.2m	(0.7m)
Stormwater Drainage – continued high reactive maintenance volumes.	(0.7m)	(1.6m)
Wastewater Collection, Treatment & Disposal - increase in operational costs primarily relating to the wastewater treatment plant.	(0.3m)	(1.1m)
Transport access and Transport safety – increased cost of illegal fly tipping	(0.1m)	(1.3m)
Building Consenting & Planning Consenting – additional costs outsourcing consent processing due to higher volumes (offset by higher revenues)	(0.5m)	(1.6m)
Other variances	2.0m	(1.3m)
Total	22.6m	4.8m

5.7 The Cathedral grant shows as an expenditure variance as it was originally scheduled for payment in August. It does not affect the overall operating surplus as any payment is offset by a drawdown of funds held or interim borrowing.

5.8 Funds not available for Opex – the YTD variance largely relates to the Cathedral grant decision, funding from the special fund has not been drawn, reduced insurance premiums against budget and reduced personnel costs.

6. Capital Expenditure and Revenue

6.1 This section covers the capital programme spend and funding relating to it.

	Year to Date Results				Forecast Year End Results			After Carry Forwards
$m	Actual	Budget	Var		Forecast	Budget	Var	Carry Fwd	Var
Core Programme	79.9	86.1	6.2		502.6	521.7	19.1	(2.6)	21.7
External Funded Programme	4.2	3.8	(0.4)		21.2	25.8	4.7	4.3	0.4
Less unidentified Carry Forwards	0.0	0.0	0.0		(13.7)	0.0	13.7	35.7	(21.9)
Core/External Funded Programme	84.1	89.9	5.8		510.0	547.6	37.6	37.4	0.2
One New Zealand Stadium at Te Kaha	36.7	33.9	(2.8)		196.3	190.2	(6.1)	(6.1)	-
Total Capital Programme	120.8	123.8	3.0	6	706.3	737.8	31.5	31.3	0.2
Revenues and Funding	(63.4)	(70.7)	(7.3)		(337.9)	(330.7)	7.2	-	7.2
Borrowing required	57.4	53.1	(4.3)		368.4	407.1	38.7	31.3	7.4

Capital Expenditure

6.2 Gross capital expenditure of $120.8 million has been incurred against a year-to-date budget of $123.8 million.

6.3 Overall, total capital expenditure of $706.3 million is forecast (based on the PMO forecast of $510 million for CCC Capital-Core/External Funded), to be spent against the annual budget of $737.8 million. Of the $31.5 million variance, the majority is forecast to be requested to be carried forward at year end.

6.4 Further information on capital expenditure is contained in the Capital Programme Performance Report for September and contained in this agenda.

Capital Revenues and Funding

6.5 Capital revenues and funding are a net $7.3 million lower than budget year to date, due to Council having received lower NZTA capital contributions primarily due to timing, partially offset by higher development contribution revenues.

6.6 The Capital revenues and funding forecast is a $7.2 million surplus, due to additional development contribution revenue.

7. Special Funds

7.1 The annual movements and balance of the Housing Account and Capital Endowment Fund are shown in Attachment A.

7.2 The balance of funds available for allocation from the Capital Endowment Fund at 30 September 2024 was $3,090,000.

8. Treasury

Policy Compliance

8.1 All Treasury risks are within Policy limits, with no breaches projected over the coming year:

Risk Area	Compliance	*Plain-language meaning*
Liquidity Risk	Yes	(cash availability)
Funding Risk	Yes	(spread of debt maturities)
Interest Rate Risk	Yes	(managing interest costs)
Counterparty Credit Risk	Yes	(not all eggs in one basket)

Borrowing & Advances to Related Parties

8.2 Council’s actual borrowing and Advances for 2024/25 are shown below ($m):

8.3 Advances are primarily to Christchurch City Holdings Ltd (currently $676.2m, down by $5 million this year). The total also includes Local Government Funding Agency (LGFA) “Borrower Notes” of $59.0 million (up by $3.0 million this year) – these are interest-bearing convertible Notes that are required to be entered into each time Council borrows from LGFA.

Funding & Interest Rates

8.4 Council’s projected funding requirements, per financial year, are shown below. These are split between existing debt maturities (green) and expected new borrowing requirements (grey).

8.5 The Council’s interest rate risk is managed to reduce the volatility of interest costs from year to year. Most existing Council debt has been fixed for at least the next three years, which will limit the impact of current higher interest rates on the Council’s future borrowing costs. The budget was prepared based on a fall in the official cash rate to 3%, which means reducing market rates will not have any material impact on Council’s cost of borrowing.

Average for 2023/24 was 5.1%; pre-Covid, in 2018/19, it was 5.2%.

9. Rates Debt

9.1 Rates debt increased $5.6 million this quarter, as shown in the table below. Rates debt is $4.3 million higher than September 2023, of which $3.3 million relates to the prior financial year. As a percentage of total rates, the debt remains relatively stable, and while it is difficult to identify specific causes for the increase, it is potentially attributable to adverse economic /cost of living conditions over the last year and reflected in the slight upswing in the graph below.

1 July 2024

Sept 2024

Change Comment

Rates Debt	28.0	33T.6	5.6	Total rates debt has remained stable this quarter.
Current year overdue	-	19.0	19.0	Sept 2023 $18m
Previous years arrears	28.0	14.6	(13.4)	Sept 2023 $11.3m
No. properties with arrears over $20,000	49	63	14

9.2 As at 30 September 7,493 rates rebates had been processed and submitted to the Department of Internal Affairs (DIA) for payment totalling $5,672,008. This is similar to last year and represents about 70% of likely applications. This year’s rebate limit is $790, compared to $750 last year.

9.3 The graph below shows 90+ days rates debt as a percentage of the annual rates strike in the respective year, with a three month moving average to smooth the quarterly cycle. This indicates that rate arrears are generally been well managed.

A graph with blue lines and numbers

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10. General Debt

10.1 The increase in debt shown below is due to an increase in invoices issued in September that are not yet due.

June

2024

September

2024

Change Comment

General Debt

3.6

11.6

8.0

Invoices for $5.4m outstanding in September will be paid in October.

Invoice for $1.9m issued in Aug’ 24 to Department of Internal Affairs is outstanding and being actively collected.

3 – 6 months

0.17

0.39

0.22

6 months +

0.41

0.78

0.37

10.2 General debt of $53,890 has been written-off this quarter. Half of this amount relates to write-offs relating to damage to street poles. The total debt write-off for 2024/25 is $53,890.68 compared to $60,519.14 for the same period in 2023/24.

11. Insurance Claims

11.1 The table below outlines the number of events that have been notified by Council against its insurance policies as well as claims against Council from third parties for the July – September 2024 quarter.

	Policy	Claims / Notifications		Estimated Cost
	Policy	Above excess	Below excess	Estimated Cost
Claims by Council	Motor Vehicle	0	0	$1,500
	Material damage	0	0	$0
Claims against Council	PI / PL	0	0	$0

Attachments Ngā Tāpirihanga

No.	Title	Reference	Page
a ⇩	Attachment A – Operational & Capital breakdown by Activities	24/1791406	84

In addition to the attached documents, the following background information is available:

Document Name – Location / File Link

Not applicable

Signatories Ngā Kaiwaitohu

Authors

Mitchell Shaw - Reporting Accountant

Steve Ballard - Group Treasurer

Martin Zelas - Rates Manager

Karthik MG - Reporting Accountant

Adrian Seagar - Manager Insurance & Asset Management

Approved By

Bruce Moher - Manager Corporate Reporting

Bede Carran - General Manager Finance, Risk & Performance / Chief Financial Officer

12. Christchurch City Holdings Ltd - Annual Report 2023/24 and Annual General Meeting 2024 Proxy and Voting Instructions
Reference Te Tohutoro:	24/1636266
Responsible Officer(s) Te Pou Matua:	Linda Gibb, Performance Advisor, Finance
Accountable ELT Member Pouwhakarae:	Bede Carran, General Manager Finance, Risk & Performance / Chief Financial Officer

1. Purpose and Origin of the Report Te Pūtake Pūrongo

1.1 The purposes of this report are to:

· seek the Council’s appointment of a proxy and alternate to vote at Christchurch City Holdings Ltd’s (CCHL) Annual General Meeting (AGM) for 2024 to be held on 29 November 2024 in Avon Room, Christchurch Town Hall, 86 Kilmore Street Christchurch at 4.30pm, and voting instructions; and

· advise the Council of CCHL’s annual results for the financial year ending 30 June 2024.

1.2 This report has been written after receiving CCHL’s Annual Report 2023/24 on 30 September 2024 and its AGM documentation on 9 October 2024.

1.3 CCHL’s AGM Agenda is Attachment A and its Annual Report is Attachment B.

2. Officer Recommendations Ngā Tūtohu

That the Finance and Performance Committee:

1. Receives the Christchurch City Holdings Ltd – Annual Report 2023/24

2. Receives the Annual General Meeting 2024 Proxy and Voting Instructions report;

3. Appoints Councillor Coker as proxy, and Councillor Peters as alternate to vote at Christchurch City Holdings Ltd’s Annual General Meeting on 29 November 2024 on behalf of the Council;

4. Agrees to vote in favour of all Annual General Meeting 2024 agenda items and

5. Notes that the decisions in this report are assessed as low significance based on the Christchurch City Council’s Significance and Engagement Policy.

3. Executive Summary Te Whakarāpopoto Matua

3.1 CCHL’s AGM is being held on 29 November 2024 in Avon Room, Christchurch Town Hall, 86 Kilmore Street Christchurch at 4.30pm. In order to vote at the meeting Council is required to appoint a proxy and an alternate (proposed to be Councillors Coker and Peters respectively) and approve voting instructions for the AGM.

3.2 For the year ending 30 June 2024, CCHL recorded a net profit after tax (NPAT) of $68 million, compared with its SOI target of $84 million and last year’s result of $99 million. The NPAT was affected by the Government’s decision to remove depreciation as a tax-deductible expense on commercial buildings in the 2023/24 year. This created a non-cash tax expense of $43 million across the group which reduced the net profit after tax and the return on equity (ROE) for the 2023/24 financial year. Adjusting for the change in tax, underlying NPAT was $111 million and ROE 4%.

4. Background/Context Te Horopaki

4.1 Section 120 of the Companies Act 1993 requires an annual meeting to be held no later than six months after balance date and not later than 15 months after the previous annual meeting, noting the previous AGM was held on 24 November 2023. CCHL’s AGM falls within the required timeframe, that is before 31 December 2024.

4.2 Schedule 1 of the Companies Act 1993 provides for proceedings at meetings of shareholders. Clause 6(1) provides that a shareholder may exercise the right to vote either by being present in person or by proxy. Clause 2 provides that a proxy for a shareholder is entitled to attend and be heard at a meeting of shareholders as if the proxy was the shareholder. The remainder of clause 6 is concerned with procedural matters.

4.3 Section 67(1) of the Local Government Act 2002 (LGA) requires the board of a council controlled organisation (CCO) to submit an annual report to its shareholders within three months of the end of the financial year. CCHL’s report was received, with an unmodified audit opinion noting a standard emphasis of matter on Inherent uncertainties in the measurement of greenhouse gas emissions, within the statutory timeframe on 30 September 2024.

4.4 Section 67(2) requires an annual report to include the information required by sections 68 and 69 of the LGA, which includes comparing performance with the Statement of Intent (SOI), explaining material variances and including an auditor’s report on the financial statements, the performance targets and other measures by which performance is judged in relation to the organisation’s objectives.

4.5 CCHL made its Full Year Results Announcement (unaudited) to the NZX on 29 August 2024 as required by NZX Listing Rule 3.5 which covers results announcements and provided its audited Annual Report to the NZX on 30 September 2024.

5. Details

Annual General Meeting

5.1 The items for the AGM Agenda (refer Attachment A) are mostly for noting by the shareholder. There are two appointments for recording as follows:

· Mr Gill Cox as a director to the CCHL board which was approved by the Finance and Performance Committee at its meeting on 24 July 2024 (FPCO/2024/00041 refers); and

· Mr Bryan Pearson as Chair of the CCHL board, approved by the Council at its meeting on 15 May 2024 (CNCL/2024/00055 refers).

Annual Report

5.2 The table below reports the CCHL group’s profitability and performance against its SOI targets for FY 2024 and the prior year.

CCHL Group	Actual 2023/24 $m	SOI target 2023/24 $m	Actual 2022/23 $m
Net operating revenue	450	N/A	383
Net profit after tax	68	84	99
Adjusted net profit after tax*	111	84	99
Dividends to CCHL parent	93	N/A	74
Dividends to the Council	51	51	32
Interest paid	108	N/A	92
Total assets	6,000	N/A	5,800
Total borrowings	2,300	N/A	2,200

*Net profit after tax was adjusted by adding back $43 million to identify the impact of the Government’s removal of depreciation as a tax-deductible expense on commercial buildings, which has had an adverse impact on the CCHL group of $43 million. The tax change was announced after the SOI and its measures had been set.

Actual

2023/24

SOI target

2023/24

Actual

2022/23

Return on equity (ROE)

2.5

3.3

3.9

Gearing (net debt: net debt + equity)

5.3 Operating revenue for the year increased by $118 million against the previous year, however this was largely offset by increased operating costs of $63 million, increased depreciation charges of $26 million and increased interest costs of $16 million.

5.4 The main reason for the significant drop in NPAT largely reflects the Government’s decision to remove depreciation as a tax-deductible expense on commercial buildings in the 2023/24 year. This created a non-cash tax expense of $43 million across the group.

5.5 Earnings before interest, tax, depreciation, amortisation and impairment (EBITDA) increased significantly to $450 million from $383 million in FY 23, driven largely by improved performance from Christchurch International Airport Limited (plus $31.8 million) and Enable Services Limited ($12 million). EBITDA is a useful measure as it provides a basis for assessing performance from operations.

5.6 Total assets increased by $200 million mostly attributable to Orion from investment in, and a revaluation gain of the electricity lines network. Total equity increased by $70 million after accounting for an increase in total liabilities of $129 million, much of it used to fund Orion’s investment in its network.

5.7 Cash flows from operating activities remained strong ($266 million) and marginally higher than the previous year ($258 million).

5.8 Unadjusted for the effect of the tax change on depreciation, the ROE is below both target and last year’s results. Adjusted for the effect of the tax change the ROE is 4% which is above target and consistent with the prior year’s performance. Staff have noted the difference arising from the tax change as this was introduced and effective after the SOI targets had been set. Staff have asked CCHL to speak to the ROE and return on invested capital as part of a responsible owner mandate that looks to maximise shareholder’s returns and deploy capital efficiently.

5.9 The following chart presents the unadjusted trend in NPAT of the CCHL subsidiary companies (noting that NPAT is a different measure of performance to EBITDA):

A graph of a group profitability

Description automatically generated

5.10 Of note:

· CIAL’s profitability through to 2022 reflects significant gains in its investment property portfolio. Since 2020, the uplift in value has been $117 million (before tax); CIAL’s NPAT over that period was $218 million and in FY2024 its NPAT was significantly affected by the non-deductibility of depreciation on buildings for tax purposes.

· Orion’s declining returns reflect the five-year regulatory price-path that has been set by the Commerce Commission, coupled with increased financing costs from debt (which has grown to $584 million in 2023/24 from $330 million in 2019/20.

5.11 The following table shows 2024 NPAT compared with the SOI targets and the prior year:

NPAT	Actual	Removal of tax dep’n on buildings	Adjusted NPAT	SOI target	Actual	Dividends to CCHL Actual
	2024	2024	2024	2024	2023	2024
CCHL subsidiary	$m	$m	$m	$m	$m	$m
Orion	12	5	17	16	22	33
CIAL	23	30	53	40	37	24
LPC	10	5	15	24	19	11
Enable	34	2	36	31	28	20
City Care	9	-	9	9	11	0
EcoCentral	3	-	3	1	2	5

5.12 The adjusted NPAT (grey) column adds back the impact of the government removing tax depreciation on buildings, to give a clear line of sight to underlying profit. The significant variances in Adjusted NPAT were as follows:

Against SOI target:

· CIAL (+$13 million) due to a value gain of $13 million in its investment property portfolio;

· LPC (-$9 million) as a result of lower volumes of containers, coal and bulk cargo due to the global economic environment and difficulties in shipping through the Panama Canal and Red Sea; and

· Enable (+$5 million) due to growth in connections to the network and cost savings.

Against last year:

· Orion (-$5 million) due to increases in operating costs from market price pressure of $8 million, finance costs of $4 million and depreciation of $4 million. Higher operating revenue of $10 million offset some of these cost increases;

· CIAL (+$16 million) from higher income and gains on property of $47 million offset by higher costs of $31 million. The increase in revenue was from property revaluation gains of $17 million from FY23 and higher operating revenue of $30 million from increased passenger numbers and occupancy of properties. Operating costs increased by $11 million, finance costs and depreciation increased by $3 million, and tax expense increased $17 million; and

· Enable (+$8 million) due to increased operating revenue of $14 million from growth in connections to the network less operating cost pressures of $2 million, higher interest costs of $1 million and a tax expense relating to adjustments for removal of depreciation on property of $2 million.

5.13 All the subsidiaries faced operating cost pressures largely from employee costs, insurance and interest costs.

5.14 On 12 November, CCHL will present a briefing to the Council on its Group Emissions Reduction Plans.

Options Considered Ngā Kōwhiringa Whaiwhakaaro

5.15 The only practicable option open to the Council is to vote in support of the items of business at the AGM. The Council is the sole shareholder and so it is necessary for it to vote so that the business of AGM can be transacted. The items are in the main for noting and the two items for recording are decisions of the Council and the Committee made earlier in the year.

6. Financial Implications Ngā Hīraunga Rauemi

6.1 There are no costs to the Council as a result of the decisions in this report. The costs of holding the AGM are incurred by CCHL.

7. Considerations Ngā Whai Whakaaro

Risks and Mitigations Ngā Mōrearea me ngā Whakamātautau

7.1 No significant risks are identified as a result of the Council exercising its responsibilities as the sole shareholder of CCHL at the AGM.

Legal Considerations Ngā Hīraunga ā-Ture

7.2 Statutory authority to undertake proposals in the report are conferred by the Local Government Act 2002 and the Companies Act 1993.

Strategy and Policy Considerations Te Whai Kaupapa here

7.3 The required decisions:

7.3.1 Align with the Christchurch City Council’s Strategic Framework.

7.3.2 Are assessed as of low significance based on the Council’s Significance and Engagement Policy. The level of significance was determined by considering the extent to which the decisions to be made in this report could impact the community.

Community Impacts and Views Ngā Mariu ā-Hāpori

Impact on Mana Whenua Ngā Whai Take Mana Whenua

7.4 The decision does not involve a significant decision in relation to ancestral land, a body of water or other elements of intrinsic value, therefore the decisions in the report do not specifically impact Mana Whenua, their culture, and traditions.

7.5 The decision will not impact on our agreed partnership priorities with Ngā Papatipu Rūnanga, as it relates to Council exercising its rights as a shareholder of a CCO at a statutory meeting to confirm the performance of CCHL.

Climate Change Impact Considerations Ngā Whai Whakaaro mā te Āhuarangi

7.15 The proposals in this report will not contribute significantly to adaptation to the impacts of climate change or emissions reductions.

8. Next Steps Ngā Mahinga ā-muri

8.1 The next steps are for the Council’s proxy to attend the AGM and vote in accordance with the Committee’s direction as set by the resolutions.

Attachments Ngā Tāpirihanga

No.	Title	Reference	Page
a ⇩	Christchurch City Holdings Ltd - Notice of AGM	24/1822001	131
b ⇩	Christchurch City Holdings Ltd Annual Report 2023/24	24/1823774	132

In addition to the attached documents, the following background information is available:

Document Name – Location / File Link

Not applicable

Signatories Ngā Kaiwaitohu

Author	Linda Gibb - Performance Monitoring Advisor CCO
Approved By	Bede Carran - General Manager Finance, Risk & Performance / Chief Financial Officer

13. ChristchurchNZ Holdings Ltd - Proxy and voting instructions for the Annual General Meeting 2024
Reference Te Tohutoro:	24/1636176
Responsible Officer(s) Te Pou Matua:	Linda Gibb, Performance Advisor, Finance
Accountable ELT Member Pouwhakarae:	Bede Carran, General Manager Finance, Risk & Performance / Chief Financial Officer

1. Purpose and Origin of the Report Te Pūtake Pūrongo

1.1 The purposes of this report are to:

1.1.1 seek the Finance and Performance Committee’s appointment of a proxy and alternate to exercise Council’s vote at ChristchurchNZ Holdings Ltd’s (CNZHL’s) Annual General Meeting (AGM) to be held on Thursday 28 November 2024; and

1.1.2 provide voting instructions.

1.2 This report has been written following receiving the AGM documents from CNZHL on 5 September 2024.

2. Officer Recommendations Ngā Tūtohu

That the Finance and Performance Committee:

1. Appoints Councillor Templeton as proxy and Councillor Coker as alternate to vote at ChristchurchNZ Holdings Ltd’s Annual General Meeting on 28 November 2024;

2. Agrees to vote in favour of all ChristchurchNZ Holdings Ltd’s 2024 Annual General Meeting agenda items; and

3. Notes that the decisions in this report are assessed as low significance based on the Council’s Significance and Engagement Policy.

3. Executive Summary Te Whakarāpopoto Matua

3.1 CNZHL’s AGM is to be held at its offices, Level 3, 101 Cashel Street (Five Lanes at the BNZ Centre), Christchurch at 4.30pm on Thursday 28 November 2024. The AGM will also include a farewell to the Chair of the board, Dr Therese Arseneau.

3.2 The timing of the AGM meets the requirements of section 120 of the Companies Act 1993 (no later than six months after balance date and not later than 15 months after the previous annual meeting). The AGM agenda is at Attachment A.

3.3 Schedule 1 of the Companies Act 1993 provides for proceedings at meetings of shareholders. Clause 6(1) provides that a shareholder may exercise the right to vote either by being present in person or by proxy. Clause 2 provides a proxy for a shareholder is entitled to attend and be heard at a meeting of shareholders as if the proxy was the shareholder. The remainder of clause 6 is concerned with procedural matters.

3.4 The agenda items for the AGM are as follows:

· to receive the Annual Report and Auditor’s Report for the year ending 30 June 2024; and

· to record governance decisions that have been made during the year, as follows

o appointment of Grant Thornton New Zealand as the company’s auditor and that the CNZHL board will set the audit remuneration;

o appointment of Ms Lauren Quaintance as the Chair of the CNZHL board for a term of three years from 29 November 2024 (approved by the Council at its meeting on 7 August 2024 (CNCL/2024/00103 refers));

o record the retirement of Mr Paul Bingham from the CNZHL board as at 30 June 2024; and

o record the board fees of $334,000 for each of the next three years from 1 July 2024, in accordance with the remuneration decisions made by Christchurch City Holdings Ltd (CCHL) which is discussed further below.

3.5 CNZHL’s outgoing and incoming Chairs (Dr Therese Arseneau and Ms Lauren Quaintance respectively) and the Chief Executive (Ms Ali Adams) will formally present CNZHL’s 2023/24 Annual Report to the Finance and Performance Committee’s meeting on 27 November (Dr Arseneau is unavailable for the Committee’s 23 October meeting).

Board remuneration

3.6 Clause 9.1 of the Council’s Policy for the Appointment and Remuneration of Directors of Council-controlled Organisations (CCOs) (the Appointments Policy) provides that CCHL is responsible for approving remuneration levels for the directors appointed to its subsidiary boards and other CCOs, including CNZHL.

3.7 The Appointments Policy includes requirements for CCHL to commission an independent consultant to benchmark the level of fees paid, consider a number of factors such as the need to attract and retain appropriately qualified people and the size, scale and complexity of the organisation and the type of expertise and specialisation needed. Remuneration is also set to reflect that serving as a director includes an element of public service.

3.8 These requirements underpinned CCHL’s advice to CNZHL in late 2023 of a fees’ pool for the board of $334,400 from 1 July 2024 until 30 June 2027.

4. Financial Implications Ngā Hīraunga Rauemi

4.1 There are no financial implications from the recommendations in this report. This is reflects that the AGM agenda items are all noting items.

5. Considerations Ngā Whai Whakaaro

Risks and Mitigations Ngā Mōrearea me ngā Whakamātautau

5.1 As the AGM agenda items are all for noting, there are no identified risks arising as a result of this report.

Legal Considerations Ngā Hīraunga ā-Ture

5.2 Statutory and/or delegated authority to undertake proposals in the report are contained in the Local Government Act 2002 and the Companies Act 1993.

5.3 Other legal implications identified include:

5.3.1 the legal requirements contained in section 120 of the Companies Act 1993 governing the annual meeting of a company,

5.3.2 schedule 1 of the Companies Act 1993 relating to proceedings at meetings of shareholders, and

5.3.3 CNZHL’s company constitution which provides for shareholder approval of board remuneration.

Strategy and Policy Considerations Te Whai Kaupapa here

5.4 The noting decisions sought are:

5.4.1 assessed as low significance based on the Christchurch City Council’s Significance and Engagement Policy, and was determined by considering the extent to which the decisions could impact the community.

5.4.2 consistent with Council’s Plans and Policies, in particular the Appointments Policy with respect to the setting of board remuneration.

5.5 This report is not directly relevant to the Council's Long Term Plan (2024 - 2034).

Impact on Mana Whenua Ngā Whai Take Mana Whenua

5.6 The decisions in this report do not involve a significant decision in relation to ancestral land, a body of water or other elements of intrinsic value.

5.7 The decisions in this report will not impact on our agreed partnership priorities with Ngā Papatipu Rūnanga.

5.8 The decisions in this report require the Council to note particular governance settings.

Climate Change Impact Considerations Ngā Whai Whakaaro mā te Āhuarangi

5.9 The decisions in this report have no impact on adaptation to the impacts of climate change or emissions reductions, as they are governance decisions, not operational.

6. Next Steps Ngā Mahinga ā-muri

6.1 CNZHL will issue invitations to councillors to attend its AGM on Thursday 29 November 2024.

Attachments Ngā Tāpirihanga

No.	Title	Reference	Page
a ⇩	ChristchurchNZ Holdings Ltd - Notice of Annual General Meeting 2024	24/1683485	213

In addition to the attached documents, the following background information is available:

Document Name – Location / File Link

Not applicable

Signatories Ngā Kaiwaitohu

Author

Linda Gibb - Performance Monitoring Advisor CCO

Approved By

Russell Holden - Head of Finance

Bede Carran - General Manager Finance, Risk & Performance / Chief Financial Officer

14. Venues Ōtautahi - Annual Report 2023/24
Reference Te Tohutoro:	24/1636043
Responsible Officer(s) Te Pou Matua:	Linda Gibb, Performance Advisor, Finance
Accountable ELT Member Pouwhakarae:	Bede Carran, General Manager Finance, Risk & Performance / Chief Financial Officer

1. Purpose and Origin of the Report Te Pūtake Pūrongo

1.1 The purpose of this report is to advise the Finance and Performance Committee of Venues Ōtautahi’s (VŌ’s) annual report and performance for the year ending 30 June 2024.

1.2 This report is written following receiving VŌ’s Annual Report on 30 September 2024 in accordance with Local Government Act 2002 (LGA). VŌ’s Annual Report is at Attachment A.

2. Officer Recommendations Ngā Tūtohu

That the Finance and Performance Committee:

1. Receives the Venues Ōtautahi - Annual Report 2023/24.

3. Background/Context Te Horopaki

3.1 VŌ’s primary activities are the attraction, planning and delivery of events and management of assets at the following Council-owned venues – Christchurch Town Hall and Wolfbrook Arena and at venues under VŌ management – Air Force Museum of New Zealand, Hagley Oval and Apollo Projects Stadium.

3.2 VŌ operates commercially but relies on Council funding support ($3.25 million in 2023/24) to assist it to meet the not insignificant fixed costs (around $6.5 million) associated with asset ownership, repairs and maintenance of venues and $0.2 million to service legacy debt. The Council also provided a capital grant of $2.5 million and made a subvention payment of $2.8 million.

4. Considerations Ngā Whai Whakaaro

Annual financial results

4.1 Comparison of VŌ’s financial performance for 2023/24 against its SOI targets and its performance the previous year (the first full year of operations since COVID-19 restrictions were lifted) is shown in the table below. The last full year of operations before COVID-19 restrictions was 2018/19 and outcomes in that year are also shown.

Operating performance	Actual 2023/24 $m	Target 2023/24 $m	Actual 2022/23 $m	Pre-COVID-19 2018/19 $m
Operational revenue	20.2	18.3	20.9	17.2
Council grant – operating	3.0	3.0	3.0	0
Council grant – debt funding	0.3	0.3	1.1	1.0
Operational costs	(25.7)	(23.3)	(23.7)	(21.4)
EBITDA	-2.2	-1.7	1.3	(3.2)

No. of events (all venues)	386	372	435	374
No. of guests (all venues)	642,775	450,000	689,707	713,393
VŌ estimate of regional economic impact through visitation^{^[1]}	$28.1m	$30.0m	$34.2m	N/A
VŌ estimate of direct regional economic impact through local sourcing	$13.1m	N/A	$12.0	N/A

4.2 Against SOI target, the EBITDA (operating deficit) is higher by $0.5 million reflecting a combination of increased operating costs of $2.4 million partly offset by increased revenue of $1.9 million.

4.3 Although event numbers were slightly ahead of target, and guests to venues significantly exceeded target, EBITDA came under pressure from fewer ticketed events, one cancelled major event (Blink-182 concert) and higher operating costs of $2.4 million (including personnel costs of $1.2 million due to the increase in the living wage). Revenue increased from VŌ’s food and beverage offering including the unbudgeted securing of all food and beverage services for SailGP as well as more lower yield events (eg those not requiring food and beverage).

4.4 Against last year, EBITDA is lower by $3.5 million due to lower revenue of $1.5 million and higher operating costs of $2.4 million. Revenue was lower due to fewer ticketed events following the buoyancy of 2022/23 which was the first full post COVID-19 year and from a lower Council operating subsidy by $0.7 million reflecting VŌ’s repayment of debt which consequently reduced finance costs. Operating cost increases of $2 million included market price pressure on insurance (+54%) and living wage (+9.9%) among other costs and Te Kaha (One.NZ Stadium) pre-opening costs which were $0.5 million higher ($0.7 million) than the prior year. The pre-opening costs are being met by VŌ and will be recouped once the stadium is operating.

Fixed costs and capital grants

4.5 The capital grant of $2.5 million enables VŌ to maintain the safety, compliance, operational functionality and ultimately the value of the venues. The annual asset management and maintenance costs of $6.57 million are underpinned by VŌ’s asset management plans which have been independently prepared and annually reviewed.

4.6 Fixed costs include a depreciation charge of $8.8 million in each year and finance costs of $0.2 million in 2023/24 (2022/23 $0.9 million). The reduction of $0.7 million arises from lower finance costs as a result of VŌ’s repayment of the majority of its debt in the last 2-3 financial years.

4.7 Income tax has increased by $14.7 million in 2023/24, of which $19 million is attributable to the Government’s removal of tax deductions for depreciation charges on commercial buildings. Other movements include the subvention payment received and adjustments for deferred tax arising from timing differences on income and expense recognition under accounting rules and tax rules.

4.8 Total assets are $252 million, $5 million higher than 2022/23. This reflects the capitalisation of roof strengthening at the Wolfbrook Arena and the continuation of the Town Hall Restoration Project. Overall total equity decreased by $12 million, largely due to the tax adjustment of $19 million arising from the removal of a tax deduction for depreciation on buildings.

Non-financial performance

4.9 VŌ has met most of its targets, including supporting local community groups and individuals, of which 57 received the community rate in 2023/24 against a target of 40 ($184,000 of value from VŌ to the community, against a budget of $100,000).

4.10 As noted in the Annual Report the health and safety target of no serious harm incidents was not met with one event relating to working at heights. The issues and control failures relating to the incident were identified and addressed immediately.

4.11 The target to “achieve reduction in carbon footprint” is noted as met. VŌ advises an overall 11% reduction in carbon emissions from its 2022/23 baseline.

Quarter 1 2024/25 Performance

4.12 VŌ has provided the following summary of Quarter 1 performance summary for the three months, 1 July to 30 September 2024 as shown in the following tables:

Actual

$000

SOI target

$000

Variance

$000

Prior year

$000

Variance

$000

EBITDA

(497)

(750)

+253

(848)

+351

	Actual	Target	Variance	Prior year	Variance
Number of events	115	101	+14	110	+5
Number of visitors	149,829	125,000	+24,829	160,142	-10,313

4.13 The Quarter 1 EBITDA result against SOI budget is a positive variance of $253,000 and higher by $351,000 against last year.

4.14 In both cases the variances largely reflect less volatility in the cost profile for asset management and maintenance costs including, for example insurance (6.5% increase versus 54% increase in 2023/24) and utilities (10% increase versus 25% in 2023/24).

4.15 Of note, One.NZ Stadium at Te Kaha pre-opening costs ($277,000 for the quarter) are excluded from reporting to focus on VŌ’s business as usual. These costs will be recouped once the stadium is operating as per the 2024-2034 Long Term Plan.

Non-financial performance targets

4.16 17 community events have been delivered to 30 September 2024 equating to $69,000 in discounted community venue rental. The annual target of $100,000 value on this basis is likely to again be well exceeded.

4.17 Client and guest net promoter score (NPS) for the quarter are 75.00 and 57.37 respectively versus the annual SOI target of greater than 50.

4.18 Total direct and estimated indirect regional economic contribution for the three month period was $7.0 million - estimated regional economic impact of guests from out of town attending events held across the portfolio of venues to end September 2024 was $4.9 million and direct contribution to local economy through VO’s source local strategy to 30 September 2024 is estimated at $2.1 million.

Attachments Ngā Tāpirihanga

No.	Title	Reference	Page
a ⇩	Venues Ōtautahi Annual Report 2024	24/1826503	221

In addition to the attached documents, the following background information is available:

Document Name – Location / File Link

Not applicable

Signatories Ngā Kaiwaitohu

Author	Linda Gibb - Performance Monitoring Advisor CCO
Approved By	Bede Carran - General Manager Finance, Risk & Performance / Chief Financial Officer

15. Transwaste Canterbury Ltd - Annual Report 2023/24
Reference Te Tohutoro:	24/1805281
Responsible Officer(s) Te Pou Matua:	Linda Gibb, Performance Advisor, Finance, Risk and Performance Group
Accountable ELT Member Pouwhakarae:	Bede Carran, General Manager Finance, Risk & Performance / Chief Financial Officer

1. Purpose and Origin of the Report Te Pūtake Pūrongo

1.1 The purpose of this report is to advise the Council of the annual results and performance of Transwaste Canterbury Ltd for the year ending 30 June 2024.

1.2 The Annual Report was received on 30 September 2024 in accordance with section 67 of the Local Government Act 2002 (LGA) which requires it to be delivered to shareholders within 3 months after the end of the financial year.

2. Officer Recommendations Ngā Tūtohu

That the Finance and Performance Committee:

1. Receives the Transwaste Canterbury Ltd - Annual Report 2023/24.

3. Background/Context Te Horopaki

3.1 Transwaste operates the Kate Valley Landfill and is required to accept all waste from within the Canterbury region that is non-hazardous.

3.2 The company is owned jointly by five Canterbury councils (50%) and Waste Management NZ Ltd (50%). The Christchurch City Council owns 38.9% of total shares on issue. Other councils with shareholdings are the Ashburton, Hurunui, Selwyn and Waimakariri District Councils.

3.3 The five local authority shareholders have delegated governance issues to a joint committee – the Canterbury Regional Landfill Joint Committee.

3.4 The Chair of the Transwaste board, Mr Gill Cox, is retiring from the board after 25 years at the company’s annual meeting later this year. The date and other details of the 2024 meeting will be notified shortly under separate cover.

3.5 Mr Cox will present Transwaste’s Annual Report and discuss Transwaste’s approach to managing carbon emissions at a Council briefing on 5 November. The presentation will outline Transwaste’s commitment to meeting district targets and its progress in developing its emissions reduction plan with targets for annual reductions.

3.6 Transwaste’s Annual Report for 2023/24 is at Attachment A.

4. Considerations Ngā Whai Whakaaro

4.1 Transwaste’s financial performance is summarised in the table below:

Financial Performance	Actual 2023/24 $000	SOI target 2023/24 $000	Actual 2022/23 $000
Earnings before interest and tax (EBIT)	21,098	20,256	22,142
Total dividends paid · CCC 38.9% share	12,050 4,687	11,650 4,532	18,300 7,119
Total assets	76,874	Not forecast	72,011
Government waste levy ($)	17,753	17,400	10,794
Total waste to landfill (tonnes)	355,051	348,000	359,810

4.2 Earnings before interest and tax (EBIT) was higher than the SOI target by $0.8 million (+4.2%) but lower than 2022/23 by $1 million (-4.7%). The key impacts over the year were:

4.2.1 Against SOI targets, the volume of waste received into the landfill was higher by 7,051 tonnes (+2%), the waste levy paid to the government was consequently higher (+2%) and Transwaste’s EBIT was higher. In large part the variances were due to higher than expected volumes of general waste which had been predicted to decline due to the economic downturn.

4.2.2 Against last year, the volume of waste received into the landfill was lower by 4,759 tonnes (1.3%) from weaker economic activity. Transwaste notes that the government’s waste levy of $50 per tonne (up from $30 per tonne in 2022/23) has incentivised both more effort from commercial businesses to extract reusables and recyclables from waste and diversion of waste to lower class landfills paying lower waste levy rates.

4.3 Dividends in 2023/24 were higher than the SOI target by $0.4 million but lower than last year’s dividend by around $6 million. Some of this year’s dividends were accelerated into last year to prevent the loss of imputation credits which if not used would have been lost.

4.4 Total assets have increased from last year by around $5 million as cash has accumulated from operations during the year.

Carbon emissions

4.5 Page 10 of the Annual Report provides an update on progress with reducing carbon emissions. In particular, it notes that of the 303,822 tonnes of carbon equivalent, 287,382 tonnes (95%) were destroyed by flaring, electricity generation or oxidised. Offsets from carbon sequestration in the forests owned and managed by Transwaste accounted for 6,804 tonnes exceeding diesel used for transport and operations. No benefit is included in the calculation for the Electronic Trading Scheme credits by Transwaste.

Non-financial performance targets

4.6 Transwaste achieved most of its non-financial performance targets in 2023/24. Those that it has not met are noted below:

4.6.1 As has been the case previously, Transwaste has been unable to export all the electricity it has produced due to transmission line capacity constraints between MainPower and the national grid. It had been discussing the potential for line improvements with MainPower NZ Ltd which Transwaste advises are unlikely to happen in the near future. The company is now looking at other options for the excess electricity it produces including manufacturing hydrogen for power transport and plant and introducing electricity powered line haul trucks. Transwaste notes that the alternative energy sector is rapidly developing and Transwaste is being presented a continual flow of new ideas for energy use.

4.6.2 Education material regarding waste management and environment has been developed for schools but engagement from the schools has been low.

4.6.3 Carbon emissions reporting to territorial local authorities identifying those emissions attributable to each territorial local authority has been completed but is awaiting Toitū audit before being distributed later this year.

4.6.4 Against a target of zero, there was one minor at-fault traffic incident, from which there were no injuries.

4.6.5 Annual turnover of staff was 18% (9 staff from workforce of 49) against a target of 15%.

Attachments Ngā Tāpirihanga

No.	Title	Reference	Page
a ⇩	Transwaste Canterbury Ltd - Annual Report 2023/24	24/1805265	278

In addition to the attached documents, the following background information is available:

Document Name – Location / File Link

Not applicable

Signatories Ngā Kaiwaitohu

Author

Linda Gibb - Performance Monitoring Advisor CCO

Approved By

Russell Holden - Head of Finance

Bede Carran - General Manager Finance, Risk & Performance / Chief Financial Officer

[1] VŌ has estimated (using the Events Economics tool) benefits to the city from events at its venues.

10. Capital Programme Performance Report September 2024
Reference Te Tohutoro:	24/1190999
Responsible Officer(s) Te Pou Matua:	Nicky Palmer, Head of Programme Management Office
Accountable ELT Member Pouwhakarae:	Brent Smith, Acting General Manager City Infrastructure

11. One New Zealand Stadium at Te Kaha - Elected Members' Update
Reference Te Tohutoro:	24/1616102
Responsible Officer(s) Te Pou Matua:	David Kennedy, Chief Executive Te Kaha Project Delivery Limited
Accountable ELT Member Pouwhakarae:	Andrew Rutledge, Acting General Manager Citizens and Community

ITEM NO.	GENERAL SUBJECT OF EACH MATTER TO BE CONSIDERED	SECTION	SUBCLAUSE AND REASON UNDER THE ACT	PLAIN ENGLISH REASON	WHEN REPORTS CAN BE REVIEWED FOR POTENTIAL RELEASE
17.	Public Excluded Finance and Performance Committee Minutes - 25 September 2024			Refer to the previous public excluded reason in the agendas for these meetings.
18.	Visibility of Capital Project Budget Changes: September 2024	s7(2)(h)	Commercial Activities	The report contains information on specific projects being tendered in the open market and accordingly it may put Council in a disadvantaged position.	This report can be released to the public once all commercial negotiations and contracts have been concluded, and subject to the approval of the Head of Procurement and Contracts
19.	Local Government Funding Agency - Annual Report and Appointment of Proxy and Voting Instructions for Annual General Meeting	s7(2)(a)	Protection of Privacy of Natural Persons	To protect the privacy of individuals referred to in the report.	4 December 2024 Following the Annual Meeting for LGFA, when the election of directors will be public information.

Author	David Kennedy – Chief Executive, Te Kaha Project Delivery Limited
Approved By	Barry Bragg – Chairperson, Te Kaha Project Delivery Limited