Council wants new CCHL chair to be named within days
A new head of Christchurch City Council’s asset holding company could be chosen by Friday next week, just nine days after councillors voted to oust the previous chairperson.
The fast turnaround is revealed in a report from acting council chief executive Mary Richardson, presented to councillors behind closed doors on Wednesday. Council released the report publicly yesterday.
Richardson recommended seeking the resignation of Abby Foote, then chairperson of Christchurch City Holdings Ltd (CCHL), and putting a new name before councillors on May 24. Her report also recommended looking at whether the board had the right balance of directors.
Councillors voted 9-4 to accept the recommendations. The report followed councillors’ request for advice on how to get CCHL in step with its chosen direction of returning more money from its existing portfolio.
Foote and board members Chris Day, Martin Goldfinch and David Hunt resigned on Wednesday evening.
Deputy chairperson Gill Cox is filling in as acting chairperson in the meantime.
Paul Silk remains in the acting chief executive role he has held since 2022. He told The Press yesterday the board was still looking to appoint a new chief executive, which he said was “an appropriate course of action”.
In her resignation letter to mayor Phil Mauger, Foote said she and the now-former directors believed the relationship between CCHL’s board and the council had broken down.
In February, councillors demanded a higher dividend from CCHL, after denying by an 8-7 vote its bid for greater control of its assets. Greater control would have boosted revenue by allowing the company to buy and sell assets and make investments.
CCHL looks after council businesses including the airport, Lyttelton port, electricity company Orion, maintenance business CityCare, fibre company Enable, and recycling operation EcoCentral. Together they are valued at $5.8 billion.
Richardson’s report provided the advice councillors requested on how to best achieve the “enhanced status quo” stance they had chosen.
Wednesday’s vote was considerably stronger than the December vote to reject CCHL’s preferred course.
Those who voted to remove Foote were Mauger, deputy mayor Pauline Cotter, and councillors Kelly Barber, Melanie Coker, Tyla Harrison-Hunt, Victoria Henstock, Aaron Keown, Jake McLellan and Andrei Moore. Councillors Celeste Donovan, Yani Johanson, James Gough and Mark Peters opposed the move. CCLHL board member councillors Sam MacDonald and Sara Templeton did not vote, and Tyrone Fields and Tim Scandrett were absent.
In line with the rules, Mauger, Cotter and an external adviser they appoint will put a new name forward to replace Foote.
McLellan said they were “working really hard to get a new team in place, so we can get back to business as usual”.
In December, CCHL forecast it could boost its annual dividend from $51 million this financial year to $126m in a decade, if allowed to manage its own assets. This compared with a forecast of an increase to $96m in the same period using the council’s preferred model. Both models would have seen dividends drop in the short term, with a forecast of $33m next year.
Council then sought dividends of $55m in the upcoming financial year, rising to $65m for both of the following two years.
Foote’s letter said the resignations were over the council’s recent demand for another $47m in dividends of CCHL, at the expense of paying down $2.3b of debt within CCHL.
The four had “lost confidence in the council’s ability to responsibly own core strategic infrastructure”, Foote wrote.
Foote and the three directors had been appointed last year. Only half the board remains – independent directors, Gill Cox and Bridget Giesen, and two councillors as representatives of the council, MacDonald and Templeton.
In December, the council narrowly voted against CCHL’s request to take control of managing the city’s assets, which would have boosted dividends, but many believed it would have paved the way for asset sales.
Business Canterbury has also criticised the council’s December vote. Chief executive Leeann Watson said councillors’ “obvious lack of commercial acumen” had led to the board members’ resignations.
“With the council oversight of CCHL causing disarray, the obvious question is who would put their hand up to take the board places now vacant, and govern an organisation with limited ability to operate commercially and independently of elected members?”