Comment: Is anybody listening?

Someone in either the Dunedin City Council or its Dunedin City Holdings company needs to pick up the phone and make a call.

The tit-for-tat accusations about non-communication between Dunedin Mayor Dave Cull, and council, and holding company chairman Paul Hudson, and the other directors, reached a new level yesterday.

Each man claimed the other was not talking to him.

On Friday, Mr Hudson said Mr Cull attended most of the holding company meetings and the Otago Daily Times could not understand why Mr Cull had not picked up on the signals from the board that future dividends were under pressure.

An Official Information Act request to Dunedin City Holdings showed that Mr Cull and the council's finance and corporate support manager Athol Stephens had attended every meeting from October last year until May this year. Neither attended the June meeting.

Asked why he had not picked up on the debt-servicing problems, Mr Cull said he was called into the meeting at 11am for a 30-minute briefing from representatives of the subsidiary companies on the previous month's activities.

"No balance sheet is put in front of me. Anyway, it is not my job to read balance sheets."

Dunedin City Holdings released its annual profit result on Friday and, as usual, published the results on Saturday in an Otago Daily Times advertisement.

Mr Cull found it an odd way of communicating - by going over the head of the shareholder, the DCC, directly to the public.

Although he received behind-the-scenes anecdotal information on the ability of the holding company to continue paying dividends, Mr Cull wanted formal communication to him and the full council.

In turn, Mr Hudson told the ODT he had received no feedback from Mr Cull, or the council, on any concerns either party might have had about the holding company.

He believed discussions should have been held to find a way around the issue of a reduced dividend putting pressure on the council's ability to service some debt.

However, he had earlier said Aurora Energy needed to invest in new infrastructure and the company could not continue to pay 100% dividends while continuing borrowing to upgrade its assets.

A liaison committee had been set up, but after one meeting, the committee had continued to meet but without any representatives of City Holdings.

This, of course, is making a mockery of the council and the companies. The office of the chief executive of City Holdings is on the same floor as the mayor and chief executive.

The council and the DCC executive management team had full holding company briefings on March 14 and July 4. Did no-one listen?The obvious liaison person should be Mr Stephens. He attends nearly all the holding company board meetings.

He has a financial role with the city council and can presumably read a balance sheet.

Was there never a time when he felt a formal report on the state of dividend payments should be requested from the holding company?

dene.mackenzie@odt.co.nz

 

 

Add a Comment

News and reviews powered by drivesouth.co.nz