Councillors accused of ‘political virtue signalling’ during directorship debate

Christchurch city councillors will continue to donate their directorship fees to a hardship fund as their six-figure salaries get a 3% boost.

Following a strong debate at the council’s first meeting of the year on Wednesday, the council decided to stick with the status quo and continue its nine-year-long policy of giving councillors’ directorship fees to the Mayoral Welfare Fund.

In doing so, the council rejected advice from an independent report that recommended councillors be paid directly for the additional work and risk associated with sitting on boards.

The annual fees for being a director range from about $36,000 to $48,000. Councillors will receive a salary of $117,647 this year, a 3% increase.

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The majority of councillors believed they were already well-paid and should not receive additional money for directorships of entities including Christchurch City Holdings Ltd, Christchurch NZ, Ōtautahi Community Housing Trust and Transwaste.

The policy was brought in by former mayor Lianne Dalziel, who wanted to prevent directorships being used as rewards.

Last year $314,000 in directors’ fees was donated to the fund, which helps families and people in “extreme financial distress”.

However, Northington Partners said the donation policy was unfair and did not recognise director contributions equally.

The vote to pay director fees to councillors was lost six votes to 10, with one abstention.

Mayor Phil Mauger, councillors Kelly Barber, James Gough, Victoria Henstock, Aaron Keown and Sam MacDonald voted for.

Deputy mayor Pauline Cotter, Melanie Coker, Celeste Donovan, Tyrone Fields, Tyla Harrison-Hunt, Yani Johanson, Jake McLellan, Andrei Moore, Tim Scandrett and Sara Templeton voted against.

Henstock said voting against paying councillor directors showed some councillors did not understand the risk and were unable to accept professional advice, thinking instead that they knew best.

“You are saying boo hoo to corporate governance best practice. Use your brain on this one, ignore the political virtue signalling.”

Mauger said if you do the work you should get paid for it.

He said councillors in Selwyn and Waimakariri districts are paid for their directorships.

Gough said directors could personally be held criminally liable and councillors could not, therefore they should be paid to reflect that additional risk.

However, McLellan said councillors were on these boards because of their role as councillors, rather than their commercial nous. They were there to represent the council and the people of Christchurch, which was a role they were already well-paid to do.

Cotter said paying board directors more implied they worked harder than other councillors, which she did not accept was true.

At the same meeting, the council had to decide how to divvy up a $1.9m salary pool amongst the 15 councillors and deputy mayor.

The pool was set by the Remuneration Authority, which decides on the salaries of elected officials. The council has to allocate the full pool, but has discretion over whether to pay councillors additional money if they take on additional roles like chairing a committee.

Councillors decided unanimously to pay all councillors $117,647 and Cotter $135,294 to recognise the additional work a deputy mayor does. The salary is a 3% per cent increase on the $114,000 councillors were previously paid and is the first increase in three years.

The irony of the decision to pay the deputy more was brought up by a number of councillors, who asked those that voted against the director fees to explain how paying the deputy mayor more money was different.

Johanson said it was unfair to pay directors more when they might not be doing more work than other councillors, but just had a different role.

Moore wanted the council to ask the Remuneration Authority to make no additional pay increase for the rest of the three-year term, but he did not get enough support from councillors.

Many councillors believed the Remuneration Authority was unlikely to listen to the council anyway.

Moore said the council needed to set a tone and practice financial restraint.

Asking the authority not to make any more pay increases this term was a worthwhile signal that the council wanted to lead by example, Moore said.