19 March 2024

Media: Local Democracy Reporter

Topic: InfraCore staff strike action

Enquiry

I received the release about Infracore action and wanted to ask a couple questions please. Can I also please be advised who the best person is to send to at Infracore/send on my behalf? Many thanks

• Any comment on the action itself? On the attached document?
• Why have negotiations failed?
• Does the council/elected members have any input into salary budgets?
• Can I please have an overview of Infracore budgeting and what portion is set aside for salaries?
• How are salary and salary adjustments set? I.e. is it linked to experience, employee loyalty, annual reviews
• Is this action going to impact on contractual obligations between Infracore and council?
• Will this action impact on the public? How will this be resolved?
• Will the public be advised?
• To what level were the council and elected members aware of these negotiations? I see no mention of it in the most recent quarterly report.
• Can the council-funded aspect of Infracore please be explained - how is the funding allocated, i.e. is there set pools for salary, maintenance etc (or does Infracore get a lump sum to use as its own discretion?)
• Does Infracore contract to anyone other than the council?
• Any other comment or response?

Response

From RLC organisation (in response to the questions relevant to RLC):

Re does the council/elected members have any input into salary budgets?

No

Re will this action impact on the public? How will this be resolved? will the public be advised?

From General Manager Infrastructure and Environment, Stavros Michael: We are taking steps and are hopeful that the impact on key public services would be minimal ie some reduction in services like cleaning and mowing may occur but the public would be advised through appropriate channels of any potential significant impact. Council will prioritise high importance areas and facilities for the likes of water supplies, stormwater management, cleaning and open spaces mowing and will continue to monitor and reassess the situation and make adjustments as required.

Re to what level were the council and elected members aware of these negotiations?

From General Manager Corporate Services, Thomas Collé: Council was aware of the annual negotiations taking place.

Can the council-funded aspect of Infracore please be explained - how is the funding allocated, i.e. is there set pools for salary, maintenance etc (or does Infracore get a lump sum to use as its own discretion?)

From General Manager Corporate Services, Thomas Collé: As an independent organisation, InfraCore is responsible for managing its own finances.

InfraCore has a Service Level Agreement with RLC that comprises of:

• A fixed amount to cover things like mowing, gardens, inspection of assets and drains etc, and to operate drinking water pumping and treatment plants and
• payments made on an as-needed basis for responding to reactive work like fixing water leaks, fixing playgrounds and other assets, operating the crematorium and looking after cemeteries.

Rotorua Lakes Council is working with InfraCore to proactively identify and reduce financial risks and we are reviewing a proposed new Service Level Agreement (SLA) that would take a longer term view for the services the CCO provides to the council.

From Mayor Tapsell:

“The Service Level Agreement Council has with Infracore is funded by rates, which is a limited resource and any funding increases have a significant burden on our community which we must always consider.

“It is expected that CCOs manage their operations independently, bid for contracts, and deliver services in a sustainable way. It's not always possible for Rotorua Lakes Council, as the parent body, to fill funding shortfalls. Council has its own limited budgets to operate within, where we’ve already allocated ratepayers money to deliver other services.

“We're currently in discussions with Infracore about a proposed new Service Level Agreement to ensure the services they provide are delivered to the expected standard within the allocated funding envelope.”

From InfraCore Interim CE Regan Fraser:

Any comment on the action itself? On the [unions’ statement]?

We acknowledge that our team members have the right to take industrial action, and we know that times are tough for many people now. Like numerous organisations across Aotearoa New Zealand, we are navigating significant financial pressure, with our current losses placing us in a challenging financial position. This backdrop makes our commitment to our workforce's well-being all the more important to us. We work hard on fostering a strong sense of unity and valuing each employee, efforts that have enabled us to stretch our resources to offer a 5% increase.

Our discussions with the unions have been conducted in good faith, yet they have unfortunately not led to an agreement. The unions' expectations surpass what is sustainable for our organisation at the moment.

We are working alongside Rotorua Lakes Council ensure the future sustainability of our organisation. We remain dedicated to our team, and we are hopeful for a resolution that upholds the long-term health of both our employees and the organisation.

The union statement says that they will work with InfraCore management to ensure that the strike will not impact burials and critical services to the Rotorua community such as 3 waters. However their strike notices explicitly say that they will be withdrawing all labour. We will reach out to clarify with them.

Why have negotiations failed?

As above.

Can I please have an overview of Infracore budgeting and what portion is set aside for salaries?

Here is the budgeting graph from our Statement of Intent for this financial year :

How are salary and salary adjustments set I.e. is it linked to experience, employee loyalty, annual reviews?

Union Salaries and salary adjustments are negotiated between the Unions and InfraCore during collective bargaining.

Is this action going to impact on contractual obligations between Infracore and council?

Yes Infracore won’t be able to deliver on some contractual requirements.

Does Infracore contract to anyone other than the council?

Infracore provides services to a number of other entities, but these are of a small value (hire plants, infrastructure maintenance etc)

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Media: Local Democracy Reporter

Topic: Lakeland Queen

Enquiry

I am aware the Lakeland Queen went into liquidation last week. May I please ask if this impacts RLC in any way?

Can I please have any comment on the liquidation notice itself, if the council sees itself as having played a role in this result (why and how), what impact not having the Lakeland operating has had on tourism (have also added Rot NZ).

From council's/mayor's point of view could the council have done any more to help Terry Hammond continue to operate the Lakeland?

Can I also please ask if the council is owed anything by the Lakeland Queen owner and if so, how much. How does the company being in liquidation impact on the boat being at Motutara Pt?

For the mayor - given the iconic nature of the boat does she, personally, feel it is a loss as a tourism attraction?

Any other comment on the situation?

Response

From General Manager Infrastructure and Environment Stavros Michael:

Rotorua Lakes Council has done all it can to assist Mr Hammond.

RLC provided the following assistance:

• Applying in 2020 to Central Government’s Shovel Ready fund to enable construction of additional lakefront facilities including commercial buildings and jetties, including for the Lakeland Queen. Unfortunately this was unsuccessful;
• Commissioning, at RLC cost, potential concept designs for a new commercial jetty for Lakeland Queen;
• Waiving slippage charges for having the Lakeland Queen in dry dock at Motutara Point, where it has been since late October 2021;
• Providing multiple extensions for the permit for slippage at Motutara Point to enable Mr Hammond to progress options for the sale or removal of his vessel from the site;
• Waiving rent for lakefront operators, including Lakeland Queen, and promoting their businesses during work that impacted on the spaces from which they operated;
• Contributing in 2021 to the cost of the removal of the Lakeland Queen building;
• Covering the cost of removal of old sheds from the Lakeland Queen jetty;
• Renewing the Lakeland Queen jetty resource consent as part of overall lakefront consents (consent was to be transferred back once lakefront redevelopment was finished and the jetty was fit-for-purpose).
• Undertaking an independent engineer’s assessment of commercial jetties at the lakefront, including the Lakeland Queen wharf. Undertaken in early 2022, it concluded the Lakeland Queen jetty was in “poor” to “unsatisfactory” condition and recommended repair work or replacement to be carried out;
• Offering to remove, at council’s expense, the old Lakeland Queen jetty at the conclusion of construction of the boardwalk. This offer was not taken up;
• Offering to cover the cost of consenting if/when Mr Hammond builds a new jetty;
• Using council contractors this year to repair loose boards on the jetty after pieces broke off and became a navigational hazard in the lake.

Council is not filing as a creditor.

Council will assist the liquidator regarding removal of the vessel from Motutara Point if/as appropriate.

From Mayor Tapsell:

“It's sad to see the chapter closing for this iconic tourism attraction which has hosted many international visitors over the years.

“Council has done all we can to help Mr Hammond get the Lakeland Queen back on the water but unfortunately this hasn’t been possible.

“Although it's been challenging for the Lakeland Queen, we've seen significant investment in tourism in recent years along our lakefront which has been hugely positive for our district.”