The Neale Park Sewer Pump Station contributed to an $8 million hole in council’s spending. Photo: NCC.

Council manager resigns amid budget troubles

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A senior council manager who came under fire last week for his lack of preparation and disclosure has resigned.

Shane Davies, who has worked for Nelson City Council for 13 years and manages all of its capital projects, resigned from his position but will see out the next few months before starting at another organisation.

It was revealed in last week’s audit risk and finance committee meeting that there was an $8.3 million hole in spending in council’s works and infrastructure budget.

Shane was unable to provide specific projects that contributed to the huge hole other than to say that the Neale Park sewer pump station upgrade was the major contributor with a $1.1 million underspend. Works at the Saltwater Creek bridge and the lack of progress at Saxton Creek also contributed to the underspend.

“The Neale Park pump upgrade is a project that spans the year, the construction hasn’t stopped, it’s just occurred at a different rate than anticipated,” Shane said.

He went on to say that the project is still within budget and within its expected time-frame.
When asked by Mayor Rachel Reese: “What’s the rest of it (the spending hole)?” Shane could not recall.

“I can’t recall off the top of my head, I think it was a small amount over a wide range of projects.”

Rachel didn’t accept that and went on to say that somehow between the end of May and end of June council had gone from being $3.5million under budget to now being far more.

“So what are these projects? I think we need to know. This is absolutely critical to the performance of the organisation.”

Shane responded: “My team manages over 120 projects, I can’t recall all the details of each one today, but I can certainly find that information for you.”

Rachel said she was finding the scenario “somewhat challenging”.

The Neale Park Sewer Pump Station upgrade is a multi-year project that was due to be completed in November but has been pushed to December due to some issues arising.

Council communications manager Paul Shattock says that the issues that have been addressed are “not considered significant”.

However, councillor and chair of the works and infrastructure committee Stuart Walker said that the issues “are significant to the functioning of the works and infrastructure meeting”.

Stuart said in last week’s Audit Risk and Finance meeting that he had made a comment a few weeks ago “how’s Neale Park going?”

“I was told ‘oh we had a hiccup but it’s under control’. Today I find in fact that the hiccup was very serious.

“That there’s foundations for some gear that’s obviously not right and something is having to be sent back out of town.”

“Now to my way of thinking that’s pretty serious stuff, and if I’m going to have some sort of oversight from a governance point of view and be confident that the work is being properly managed, it makes it pretty darn difficult for me.”

Paul says the issues that have been remedied are that concrete was poured into the pump plinths before steel beams for the fixing of the pump pipework were installed so the concrete had to be removed.

He says that this detail was not shown on structural drawings, so the subcontractor had already poured the concrete before the main contractor became aware of the foundation beam requirement.

There was also a manufacturing fault with the flanges on the steel pipe supplied and they were sent back to the factory to be fixed.