Wednesday, May 31, 2023

Thomas Cranmer: Minister Awaits Review into DOC Funding Hole

Multiple reviews are examining options to address a $25M to $40M funding hole in its operating budget and a reported $300M, 70,000 hour maintenance backlog for huts, tracks and visitor assets.

Following Friday’s revelation that Budget 2023 has left the Department of Conservation with insufficient funding to meet its basic running costs, Chief Executive Penny Nelson sent an email to all staff later that day addressing some of the issues raised in my article.

The email also sheds further light on the precarious financial position that the department now finds itself in. It makes clear that Minister Prime is aware of the situation and is expecting to receive the initial results of several reviews taking place by the end of August.

In the leaked email, Nelson stated, “To make sure we have more stability in future, our Minister has supported us to work on a review of our baseline funding and future capability. This will look at the true cost of the work that we do and the outputs we achieve, to help present to the Government what the department could do if we got more money. The initial results are due to our Minister by the end of August.”

It is understood that following Budget 2023, the current hole in the operating budget is between $25 million to $40 million, which is projected to increase to at least $85 million within 3 years.

However, the funding crisis has been anticipated for some time. It is understood that PWC has been in the department for the last four weeks conducting an independent review of the baseline costs and funding, and that Nimbl Consulting is undertaking a review of the asset management plan.

Although the results of those reviews are due to be delivered to Minister Prime by the end of August, the expectation is that nothing will be done by the Minister before the election. This will, therefore, be an urgent matter for the incoming government and the new Minister of Conservation.

In her email on Friday, Nelson rejected the suggestion that job cuts were inevitable, stating, “This is not true. We are not laying people off”. Whilst no decision on jobs has yet been taken, it is difficult not to conclude that a significant number of jobs are nevertheless at risk, particularly given the uncertainty that exists about which programmes will be affected by the lack of funding and the fact that employment costs make up a significant amount of the department’s baseline costs.

An Official Information Act request from August last year revealed that the total staff headcount for the department as at 30 June 2022 was 2,564. Sources within the department estimate that approximately 10% of those jobs could be at risk pending the outcome of the current reviews and any decisions that the Minister may make. With morale already affected by the on-going crisis staff turnover has increased from a historic baseline of 8% to 16%.

Green MP Eugenie Sage has already raised concerns with the government regarding some of these issues through a series of Written Parliamentary Questions submitted the week before the Budget. In a number of questions, Sage asked whether the department has adequate operational funding to maintain its visitor assets.

The Minister responded, “The Department of Conservation has advised that it has a large and ageing visitor asset base, which it cannot continue to maintain and keep to required standards. It needs to ensure that it provides for a spectrum of experiences, whilst making difficult decisions on what assets that are replaced and maintained ensuring the visitor network is financially sustainable. Work is underway to develop asset management plans for all Visitor Assets. The plans will identify the level of operating investment required to sustainably maintain existing hut assets on public conservation land.”

In a separate question to the Minister, Sage asked for details about, “the reported $300 million, 70,000 hour maintenance backlog for backcountry huts, tracks and other visitor assets.”

The backlog underscores the recurring issue of Ministers consistently refusing to allocate additional funding to existing programs over the course of many years. Instead, adequate funds have only been made available to new programs that the government prioritises and that are ringfenced within the Natural Resources Cluster.

Amongst the most pressing maintenance issue for the department is the 520 suspension bridges dotted across the country on many of our trails and walks. Although constructed in accordance with best practice at the time, that is no longer the case given that a single point of failure will cause a bridge collapse. Current best practice requires two points of failure before collapse.

The issue was highlighted when a Lake Waikaremoana tramping track bridge collapsed in September 2015 in Te Urewera. Two tourists were unharmed after falling eight metres off the 65m-long Hopu Ruahine bridge when one of two suspension cables on the bridge gave way while the trampers were crossing.

Although the chance of a failure is extremely small, recent engineering and legal advice to the Department of Conversation is that the 150 suspension bridges in high use areas should be immediately closed and upgraded. That would mean the temporary closure of many, if not all, of our Great Walks. A lack of funding and a desire not to raise the issue with the Minister has meant that it has not yet been adequately addressed.

However, Eugenie Sage is clearly aware of the problem. On 12 May, Sage asked the Minister, “What advice has the Minister received, if any, about the number of bridges which have been deemed to be in need of “safety-critical work” in the last 24 months?”

Prime responded, “I have not received any advice from the Department of Conservation regarding the number of bridges in need of safety critical work.”

The department is instead trying to quietly do what it can with its limited funds. On Friday it announced that three popular bridges in the Wānaka area were being closed for safety reasons. The DOC press release stated that the Blue Pools and Rob Roy bridges required upgrade work to ensure there are measures in place should a key component fail, while the Makarora bridge has reached the end of its operational life.

Department of Conservation Central Otago Operations Manager David Butt stated while the closures will be frustrating for people who want to visit these sites, visitor safety is at the heart of the decision.

“These are popular sites that see a high level of visitation, particularly over the summer months. Engineering advice is that they cannot sustain the current usage, and with visitor numbers continuing to increase, we need to make them safer.”

Unfortunately, this safety issue extends far beyond these three bridges and impacts all 520 of DOC’s suspension bridges.

Beyond its funding squeeze, the department is also bracing itself for criticism which is expected to follow the release of the review of the treatment of kiwi which DOC has sent to Cape Sanctuary. The sanctuary is situated at Cape Kidnappers, Hawke’s Bay and was founded by Julian Robertson and Andy Lowe. Robertson was the owner of the Cape Kidnappers Golf Course and an American billionaire and philanthropist who died in New York last August at the age of 90.

Concerns first came to light when a report into the deaths of several little spotted kiwi at the sanctuary in 2015 revealed that they died from neglect. A video then emerged of Sir Paul McCartney cuddling a squirming kiwi during a visit to Cape Sanctuary in December 2017 which raised concerns that the country’s largest privately-owned conservation project had been allowed to show off kiwi to wealthy tourists without a permit, despite welfare concerns about the birds.

Following recent media coverage over the treatment of a kiwi at Miami Zoo, focus has again turned to the Department of Conservation and Cape Sanctuary which remains under investigation over whether our national birds have been mistreated here at home.

Cape Sanctuary has been the subject of multiple reports over the past five years although concerns continue to be raised about the treatment of kiwi there. It is understood that a kiwi was recently accidentally shot and killed by a guest participating in a rabbit hunt. According to sources, the killing has been reported to the department.

DOC and the sanctuary have now confirmed that an external review is nearly complete and is due out in June although it has been delayed numerous times already. It is understood that legal heavyweight, Mai Chen, is acting for Cape Sanctuary.

The Department of Conservation was contacted for comment but did not respond prior to publication.

Thomas Cranmer, Lawyer with over 25 years experience in some of the world's biggest law firms. This article was published HERE


CXH said...

Underfund the department, censure them for not doing their job, hand over all DoC land to any iwi with it's hand out, increase the budget to double that required.

Quite a simple plan really.

Anonymous said...

For goodness sake, why is it that as soon as there's ever an issue, in come the outside consultants, like PWC, to run up the ever growing fees? What are we paying our public servants big salaries for? If they can't clarify the issues, they should be the first to go and then there may well be enough money to do the basics.

Anonymous said...

May explain why the track booking system for next season isn't working yet. No money to maintain it and no money to keep all great walks open. Just wondering.....?

Anonymous said...

I've been thinking exactly the same as CXH.'
The reason they're not telling the Minister about the bridges needing replacement is...?
The stench of TOW and co-governance is hanging in the air.
Roll on October and let's sink this racist government for good.
It's our NZ outdoors inheritance with assets that were paid for by all of us. Why should we give it away to Iwi corporates and then pay to keep it maintained?

Robert Arthur said...

When over $50 million was dished out to maori media, primarily promotion of a giant hobby industry and propoganda machine, the DOC requirments seem modest.

Anonymous said...

And what do we have then CXH, a Maori mafia playground for free eh bro.