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A Southland Chamber of Commerce letter about its lack of confidence that the council can fix its own problems has also been revealed to be damning in its criticism.
The information is in a raft of documents and correspondence between city councillors, council staff, the mayor, major stakeholders and the Department of Internal Affairs (DIA) on the matter of the DIA’s interest in the council, released by the council following a request by the Otago Daily Times.
In August, the DIA stepped in to review the council’s performance amid concerns about serious internal conflict.
An emailed note from council chief executive Clare Hadley in the document bundle, dated October 13, recollected conversations she had with DIA staff this year.
Her notes made it clear her first conversations with the DIA started in January, when a staff member called her about a reference check.
The DIA’s deeper involvement grew out of a subsequent series of broader discussions and meetings following the initial contact.
Mrs Hadley noted that, in those initial discussions, DIA staff were interested in "the lay of the land" at the council. That was particularly in relation to litigation between Mayor Sir Tim Shadbolt and the council after it declined to pay his costs in the successful defence of a defamation claim by then-councillor Karen Arnold, and the later breakdown of the regional recycling tendering process.
She noted that in August, during councillor conversations about the performance of the council, Cr Ian Pottinger wanted to understand what options for support for the council there might be, and the mechanics concerning Crown observers.
"Cr Pottinger suggested it would be helpful for councillors to understand what the role/responsibilities of a Crown observer might be. He felt contact should be made with Local Government New Zealand [LGNZ]," Mrs Hadley said.
She contacted LGNZ and was referred to the DIA, which subsequently wrote to the council on August 18 seeking assurances and evidence the council was taking proactive steps to restore trust and confidence in its ability to meet the Crown’s expectations of a high-performing council.
The council made the contents of the letter public several days later.
The documents also disclosed a September 3 letter from chamber president Neal McAra to Sir Tim and councillors and copied to council and DIA staff.
In it Mr McAra states the chamber shared the DIA’s view several high-profile capital projects were testing the capacity of the council to provide strong, united governance and leadership.
"We believe the challenges facing the council are beyond the councillors’ ability to resolve.
"Consequently, we do not believe council can resolve its differences and represent its community with unified leadership."
The underlying issues were systemic and long term in nature, he said.
"These systemic failures have been significant contributing factors to the bottleneck of major capital projects, and we have concerns about the council’s ability to achieve several long-term plan targets.
"The chamber believes there is a vacuum in leadership around the council table and a poor understanding among many councillors of what the governance role of elected representatives is.
"The ongoing and very public conflicts ... have been very embarrassing, and have led to a significant loss of confidence in the council from within the Southland business community."
The chamber would continue to work with the council, but "feedback from many of the 450 businesses we represent is that time and time again when concerns have been raised, they have been met with indifference and inaction ..."