Infighting, surveillance of fellow candidates, legal action and asset sale allegation leaks have one of Auckland’s most important – and forgotten – elections shaping up to be a gamechanger.
Tomorrow more than 300,000 electricity customers will start receiving voting papers for the 2018 Entrust election, just weeks after receiving a $350 rebate from the trust.
The distribution of the rebate is one of the most popularly known functions of the consumer trust which annually returns approximately $100 million to Aucklanders through its 75.1 percent share in power company Vector.
Despite Entrust’s mandate to provide consumer rebates, protect power prices and determine the future of Auckland’s big energy utility valued at $3.3 billion, the three-yearly election has historically failed to capture the attention of voters – in 2015 attracting a voter turnout of under 13 percent.
So what makes this election any different?
For a start there is the very public fracturing of the Communities and Residents (C+R) organisation which has enjoyed an unrivalled monopoly over Entrust’s five seats for the past nine years.
A complex series of rifts within the centre-right C+R group began in March when long-standing trustee and Vector director James Carmicheael left the organisation after being de-selected from its successful ticket in favour of National Party board member Alastair Bell.
Fractions continued in May, when Vector chair Michael Stiassny announced he would not run for re-election after losing the support of Entrust.
The decision to move away from Stiassny was far from unanimous with trustees Karen Sherry and Carmichael saying they had been cut out of decision-making by chair William Cairns, deputy chair Michael Buczkowski and Paul Hutchison.
Sherry, the longest-serving trustee told Stuff.co.nz the effective dumping of Stiassny led by her colleagues was “lacking in transparency, and unprofessional”.
To make matters worse for C+R, Carmichael filed High Court action on May 28 against his fellow trustee Paul Hutchison, alleging the former National MP did not live within the Entrust district making him ineligible to be elected.
The district’s boundaries cover the former Auckland Electric Power Board (AEPB) district which is Auckland, Manukau, northern Papakura and eastern Franklin.
Evidence submitted by Carmichael to support his claim included a 17-page report by private investigator, Paragon, which carried out physical surveillance of Hutchison at his South Auckland property as well as evidence from electoral rolls, neighbours and Hutchison’s company and vehicle registrations
Hutchison rejected the claim with a statutory declaration, however the court action will not be resolved until after the election.
The C+R infighting intensified in August when the Vector board announced it was delaying its annual general meeting, in which Stiassny was to step down, from September 27 to October 29 – after the Entrust polls close.
Entrust’s majority retaliated with a lengthy and critical press release on August 30 calling for a special meeting of Vector stakeholders to remove Stiassny early because he was increasingly acting “against the best interests of shareholders and beneficiaries”.
The decision to send the press release was made without the consent of trustees Sherry and Carmichael, further dividing the C+R team.
Among other allegations in the media release Cairns accused the high-profile Vector chair of falsely suggesting to the media there were plans afoot for Entrust to sell down its Vector shares.
Cairns and his fellow C+R candidates denied any intentions to sell down Entrust’s Vector stake even going to the trouble of retrofitting their campaign billboards with neon orange signs to that effect.
In that same month Carmichael, who has also come out against a Vector sell-down, announced he was running for re-election as an independent with a campaign he says he funded himself.
He told Newsroom his chances of re-election have been improved by not being associated with the party he’d been with for 12 years.
“Given the poor behaviour of some C+R members and public concern regarding whether they act in the best interests of Aucklanders or themselves, I am proud to be independent.”
And just when it seemed there had been enough politicking came the Vector board’s response to Entrust’s request for the special meeting of the Vector shareholders.
Not only would there be no early shareholder meeting – Vector’s AGM would be further delayed until November 12, well after the newly elected trustees had been declared.
In an effort to exploit the disarray of the group it’s struggled to beat, C+R’s main opposition, the Labour-Green aligned City Vision sent out a string of media releases questioning C+R’s infighting as well as an open letter demanding answers from Cairns.
The letter sent on September 4 put 30 questions to Cairns on topics including payments made to Entrust trustees, Vector’s performance during April’s storm and advice provided both in the Stiassny rift, and in a High Court case over the eligibility of former National MP Paul Hutchison to be a trustee.
Today, Vector announced it would settle with the Commerce Comission after being found to have breached electricity network quality standards in 2015 and 2016 allowing an “excessive level of power outages”.
The power company will learn the sum of the fine in an upcoming penalty hearing.
City Vision’s leader and former cabinet minister Peter Neilson said Entrust’s response to his questions was sub-par, with Cairns answering many of them saying the information will be available in the trust’s annual report or discussed at an Entrust meeting after the election.
While the trustees are publicly elected, Entrust has the status of a private trust meaning it is not subject to the same official information rules as other publicly elected organisations in New Zealand.
Neilson said if elected City Vision, would adopt more transparent public disclosure rules in line with other public organisations.
The organisation has also since started a petition to “stop the sale of Vector” following an NBR article published in mid-September suggesting Australian bank UBS was working on a Vector proposal.
NBR reported: “…a market source said he had seen elements of an investment bank plan involving a restructuring of Vector’s distribution network into a separate subsidiary company, which would then be partly sold to an outside investor.
“Such a move would require a shareholder vote, so could proceed only with the support of Entrust but would not involve a sale of Vector shares.”
Whether there is any truth to that will remain unclear after the election.
There are 13 candidates standing for election including five from C+R, five under the City Vision ticket and three independents, James Carmichael, Ashraf Choudhary and Ian Ward who is running under Energise Auckland.
To be counted, all completed voting documents must be in the hands of the Returning Officer by 5pm, October 26 2018.
