Council not ‘transparent’ on liability scheme

Photo: Supplied
Photo: supplied
An Otago regional councillor has hit out at the council for holding discussions behind closed doors on an issue which was aired in public by other organisations.

It emerged earlier this month that councils throughout the South were liable for claims against Riskpool, a shared liability scheme between councils, which had lost a multi-million-dollar case.

The liability scheme provides protection to councils for the likes of watertight building cases. Each member has to pay a bit more in the event of claims exceeding reserves.

Riskpool lost a Supreme Court case over Napier apartments and was now liable for a $12.884million payout.

Of the eight district or city councils in the South, the Dunedin City Council was not part of the shared liability scheme and did not have to pay anything, while the Southland District Council had received confirmation it was part of the scheme but no notice had yet been sent for payment.

Collectively, the city and district councils will be forced to fork out more than $500,000.

The Queenstown Lakes District Council was paying the most of any council in the South for its Riskpool contribution, facing a bill of $146,489.

The Invercargill City Council had to pay $123,323.

Regional councils have also been hit by the scheme.

Environment Southland was being hit with a bill of $55,000, which was due next week.

The council is owed $6,000 by the scheme, which will partially offset this liability.

The Otago Regional Council (ORC) this week released its cost from the exposure to the Riskpool scheme, $104,749.

It was discussed at a public-excluded section of a meeting.

When asked why it went behind closed doors for the issue, the council said it was because of commercial reasons and to avoid prejudice.

Otago regional councillor Michael Laws was scathing about the decision by the council to go behind doors.

"It is yet another mad example of ORC’s internal hypocrisy around being honest, open and transparent," he said.

"They, collectively, need a dictionary or to resit the NCEA level1 literacy standard."

Including the regional councils’ liability, the bill for councils in the South was $683,152.

The Riskpool scheme was in the throes of being wound up.

The Queenstown Lakes District Council had moved a motion at a meeting in October to lobby central government to limit council liability to 20% of any liability claim.

The council was already paying out considerable costs after it agreed a confidential settlement with the body corporate of the Oaks Shore apartments in Queenstown, which had initially claimed $163 million for leaky building repairs.