Received from Christchurch Driver [CD]
Mon, 24 Oct 2016 at 11:08 p.m.
Readers, we must again raise our teacups – yes, a bit of condensed milk would be nice, makes the shareholder revenge all the sweeter ! – to Vaughan Elder of the ODT, who rose to the What if? challenge, and lifted the lid (25.10.16) on some astounding revelations at Delta : Management “instructing” staff not to deal with urgent, “compromised” poles but instead, continue with programmed pole replacement. The following is the intellectually threadbare accounting intellect practised by Grady Cameron and the directors (and others) : We only have X funds allocated, and those funds have to replace Y poles and Z number of urgent compromised poles. No one knows the number of Z, but everyone knows Y because we have to publish it in our public records. Therefore we will continue with non-urgent Y, because if we reduce it awkward questions we can’t be bothered answering will be asked, and we will just defer – yet again – urgent work. She’ll be right. There’s not that many Z number poles falling down – we’ve just made a resolution that they are within our risk tolerances – no one’s been killed yet (Oh yes, Steelo, shame about that) – moving on – pass the madeira cake with the almond icing over here will you Trevor ?
Readers, it does appear that Nigel Saunders has confirmed that Delta management are telling staff to break the law, and refusing to put it into writing. Mr Saunders wrote in a memo “line supervisors are currently acting on a verbal instruction only which no-one seems to be willing to back up in writing, and if something goes wrong we all know what happens next”. What happens next in the event of an accident, is that Grady would solemnly pronounce that Procedures Have Not Been Followed, and Immediate Disciplinary Action Has Been Taken, and We Are VERY Sorry About the Failure By Line Staff To Follow Clear & Comprehensive Delta Regulations. (Code: Nothing to do with me, NOT MANAGEMENT’S FAULT….). That Mr Saunders had to put this in a memo and put his neck on the line shows what a toxic, dysfunctional place Delta has become.
If we were in any doubt that Delta and Aurora must be terminated, it came with Mr Saunders next revelation, that even when compromised poles are stabilised the solution actually involved waratahs and number 8 wire. Delta and Aurora must be the laughingstock of the lines industry.
The depth of the arrogance and cynicism displayed by Grady Cameron and directors Parton, Frow, Kempton and McLauchlan towards the shareholders is nowhere more evident than the 2016 accounts :
The directors gave Grady Cameron a massive pay rise for failing to meet 5 of the 8 Financial Objectives set by the Delta board last year; but Grady says in the report “we have increased shareholder equity with a prudent approach to risk and revenue growth”, and we get the euphemism meter off the scale as Grady attempts to explain why operating cash flows, the life blood of the business, are down from the forecast $9.974M to just $3.439M. Grady came up with this pearler, “Operating cash flows were $3.4M for FY16, below the forecasted $10M, due to temporary differences in the timing of receipts from customers.” Grady, would those “customers” be effectively just ONE customer, and would that customer have been Noble Investments, and is the temporary difference in timing, your sub-truthful way of saying that Delta will not receive all of its expected funds until, as the DCHL chairman admitted, until 2024 ? Shall we expect to see this disgraceful quarter truth featuring in your reports until 2024 ?
As well as the debacle over the cash flow, Grady and Delta failed spectacularly on the debt : The objective was debt at $21.728M, but debt is at….$29.165M, which is over $2M MORE than last year, ($26.5M), when Grady was singing the same cheerful song, all is well, we have our debt well in hand.
The truly depressing thing, is that if we look at what 3 financial objectives Delta did achieve, there is no cause for celebration there either :
Net Profit : achieved (just) $4.67m, vs objective of $4.61M. Now as any accountant knows, with turnover of $100M, it will not be hard to adjust the average $8.5M work in progress (WIP) to get whatever profit figure you want, within reason, so we should take no comfort that the $4.67M is a real figure, but that it might suffer an embarrassing reversal next year. (Remember readers, “I’ll be gone, you’ll be gone”…. that refrain in the boardroom must be getting louder….)
Capital Expenditure : Delta achieved its “target” of not spending MORE than $6.421M, by only spending $4.101M. This is an odd measure to gauge the health of a capital intensive business – to gauge how LITTLE the company spends on essential assets needed to perform their work efficiently. It shows the company is very constrained and has almost no capital base of liquid funds or retained earnings to use for capex.
Finally, Dividends : Yes, The target $2.5M DCHL dividend was achieved, because once again, the debt levels went up $2.7M to accommodate this, from $26.5M last year to $29.2M. Directors, if you want to deny this, show us, don’t tell us, and by the way, where is the “Investment in Financial Instrument” of $2.19M recorded as an asset ? Back to the dividend, at $5,000 each, this would have given Dunedin 500 new power poles and a much safer electrical environment. Grady, for all your faff about your environmental performance (heard the news, fleet fuel consumption down from 9.68 to 9.62 l/100km!) – what about the ratepayers’ street environment who have to dodge hundreds of your disgraceful poles with fear and trepidation. The fear and trepidation will soon belong to you – because there will be some waste management of the management waste, to coin a phrase, and it will involve “recycling” you to an “out of region facility”, and “recycling” those dismal directors back to their day jobs.
[ends]
—
Related Posts and Comments:
22.10.16 DCC struggles with Governance…. Delta/Aurora/DCHL…
21.10.16 Dunedin City Council must hang the companies out to dry
20.10.16 Delta #EpicPowerFail : Delta fulfils Adam Smith’s 1776 Prophecy
19.10.16 Grady Cameron and Graham Crombie : Eyes tightly shut #FAIL
13.10.16 COMPLETE Dis-satisfaction with DCC, DCHL, DVML, DVL, Delta….
9.6.16 Aurora Energy Ltd warned by regulator
█ For more, enter the terms *delta*, *aurora*, *epic fraud* or *dchl* in the search box at right.
—
Posted by Elizabeth Kerr
This post is offered in the public interest.
*Image: cagle.com – cold comfort by Nate Beeler, tweaked by whatifdunedin
What if? Dunedin... 
We have here absolute proof that if you don’t pay peanuts you get expensive monkeys.
In other words, it’s not the salary that makes a difference.
So-o-o-o… why has the myth persisted, about having to pay world-wide salaries to attract people of the right calibre? It’s been proven nonsense time after time.
Why aren’t top jobs tendered? Lowest/highest tender not necessarily accepted. Opportunity would be given for clued up competent people to work their butts off to get experience and a great reputation >> put in a higher tender for the next job they apply for. Just like common people……
Today high view numbers for Delta and University posts despite lack of conversation at Comments. Nice to see a few downloads happening for the Delta 2016 Annual Report referenced by CD in his post.
Obviously the fact of Delta not tracking strongly in its accounts means too that the prior release of the Statement of Intent 2016/17 was Most Uncritically received by Dunedin City Councillors when tabled. Except for Vandervis and Calvert. But we knew that would happen. Doug Hall who knows civil construction and development and the Christchurch market, didn’t speak out to all his Cr colleagues to advise. Hmm.
The SOI was a ‘hopeful’ and unlikely lead document given Yaldhurst, given annual reports before the 2016 edition. And given the whistleblowing phone calls and catchups with upset Delta personnel experienced by various of the What if? team this year in particular.
CD has been very helpful in drilling into the figures this week. Definitely more to come as we look forward to the results of the Energy Safety audit and what will be more cracks in the top of the Aurora/Delta/DCHL porridge.
The announcement that DCHL are “reviewing” the revelations is corporate speak for nothing other than we are trying as the matter of highest priority to find a way of discrediting Richard Healey and the source of the anonymous leak with the aim of diverting any effort to apportion blame on ourselves.
Its called self-preservation. Crombie, Cameron and Cull don’t want any information out there to show that they have been remiss in any of their duties for which they are being paid to perform.
It would not take 2 minutes to confirm that Delta have budgeted to replace 314 poles when 2910 poles need to be replaced. It doesn’t need a “review” to ascertain that as Cameron has already publicly admitted the higher figure. A 1 minute look at the financials for this year would confirm the budgeted replacement figures.
Richard Healey states that Delta have been raping the asset for 20 years. How true that is. Delta management and governance have been playing around in the corporate world for years losing millions and millions of ratepayers funds without one ounce of accountability. The various rugby rorts and then Jacks Point, Luggate and Yaldhurst.
Cameron needs to be suspended by Crombie while this “investigation” or “review” is being undertaken and until the findings by independent bodies are concluded. The DCC also needs as a matter of urgency to decide whether to continue with the current Board of DCHL – I can’t see one reason for that Board to have the confidence of the DCC. But of course by expressing a view on that the governance of the DCC also exposes themselves. Self preservation will dictate what happens.
Elizabeth – in simple lay terms my understanding was that two years ago Aurora Energy dropped a bombshell on DCC (through DCHL) by stating no annual dividend forthcoming as available money has to be used for a capital works programme of replacing power poles in Dunedin and Central Otago. Apart from the internal dysfunctional environment that is preventing this work from being carried out to acceptable safety levels; if Aurora are now saying there isn’t sufficient money it begs the question where has their income from our line charges gone? I recall their ODT ad earlier this year (or last year?) justifying an increase in line charges on this very premise. If Delta as the contractor have taken it and used it elsewhere (Yaldhurst?) then hard questions need to be asked by the Mayor, Councillors and CEO. Afterall the Council owned Company belongs to us ratepayers!!! As I said before we have had this before with Mudtanks in South Dunedin.
Hard questions are useless unless those that are receiving the questions are willing to answer them truthfully. Delta/DCHL/DCC have learned by experience that there is NO such thing as accountability. South Dunedin is a good example. I don’t think that anyone can point to any degree of accountability accepted by Delta, Aurora, DCHL or the DCC. Dunedin ratepayers had an opportunity to change this state of affairs but chose not to do so.
Wed, 26 Oct 2016
ODT: Delta, Aurora subject of three investigations
Three separate investigations have been launched into Aurora and Delta amid claims their failure to replace dangerous power poles could cost the Dunedin City Council tens of millions of dollars. The magnitude of the accusations against the closely linked council-owned companies continued to grow yesterday.
….Mayor Dave Cull announced yesterday Dunedin City Holdings Ltd (DCHL) was reviewing the claims against Delta and Aurora.
The Commerce Commission also said it was investigating Aurora for breaching limits on the duration and frequency of system outages or interruptions on its network in the 2015-16 financial year.
….This follows the launch of a Worksafe investigation in recent weeks and comes as an internal document leaked to the Otago Daily Times yesterday showed Delta originally planned to replace 314 power poles this financial year. Cont/
—
Quotable quotes from article:
“….it is not possible to smooth the bow wave associated with poles approaching end of life” –leaked document
“Basically, they have raped the asset for 20 years and now someone is going to have to pay and it’s going to be the ratepayers.” –Richard Healey
Asked if he expected a request for tens of millions of dollars to help with the pole replacement, Mr Cull said he did not.
—
Ludicrous non-comprehension of Aurora and Delta’s true financial positions by our pet-project Mayor.
And then…….
“Mr Cull said the big question was whether the claims against Delta were valid.”
—
Explanation via ODT:
“Delta and Aurora are intimately linked. Aurora, New Zealand’s sixth-largest electricity distributor, contracts infrastructure company Delta to plan, manage, operate and maintain the network.”
$13.528 million is written off as shown at pages 38, 45 and 54 of the Delta 2016 Annual Report (financials) in relation to the Yaldhurst Subdivision in Christchurch (although it’s silent that it is the Yaldhurst receivable and mortgage default being written off).
This should set the wrongly published (ODT and elsewhere) record straight; in that Delta through its recent second mortgage $13.2 million loan to the Yaldhurst developer (Infinity Yaldhurst Ltd) is its attempt to chase $13.2 million of what is/was an over $26 million debt, ie not of a $13.2 million debt. If Delta had not cheated the caveators with prior interests in the subdivision, it could have recovered most if not all their debt.
Delta continues to cover-up (page 54 – “the first mortgagee has accepted a conditional offer for the sale of the property”) that Delta was, albeit illegally under s84 of the Property Law Act, the controlling first mortgagee having purchased with ratepayers money 67.5% of the first mortgage (off Gold Band Finance and Avanti Finance) plus having 100% control over Gold Band’s remaining 32.5%.
“Mr Cull said the big question was whether the claims against Delta were valid.”
Has he been hit on the scone by a power pole or two?
Repeated blows to the head have been proven to cause… well, seldom anything good.
Reasoning ability. Capacity to take in new information and process it. Memory. Rationality. Mood disturbances.
Not that our esteemed Enchained Malady is other than perfect, good heavens no.
Received from Rob Hamlin
Wed, 26 Oct 2016 at 12:17 p.m.
HOW MANY RED TAGS?
How many red tagged power poles does Delta/Aurora have? You could choose to believe them (Can’t bring myself to recommend that), or go out and check for yourself. Today I counted how many red tagged power poles were immediately visible from a single pass in a car moving at 50kph between the main road junction coming into Mosgiel and my home. This is 2.6 kilometres down Gladstone Road North and Wingatui Road.
There were ten, about 1% of the claimed total. Presumably Mosgiel must be a ‘bad patch’! The ten included the particularly abysmal example shown in the accompanying pictures – I went back with a camera. This fixture stands at the junction between Wingatui and Soper Roads. It consists of a line ‘T’ junction for both local and domestic distribution voltage networks with a transformer stepping down from the former to the latter. The entire complex, and presumably extremely heavy, mass is mounted on two poles driven into earth slope.
One suspects that originally the ‘T’ junction was not there, as the two poles seem to have no bracing to resist the considerable weight of wires going off at 90 degrees down Soper Road. Presumably these extra wires were ‘hung’ off these two unbraced poles when Soper Road was developed. This would explain the considerable lean on the two wooden poles, which also seem to be not in the best of health at ground level. As a bodge it has clearly stood for some considerable time.
But for how much longer? Both the poles supporting this substantial structure carrying high voltage cables in several directions, including one over a regularly trafficked road, are red tagged. If they chose to roll over at the moment the photos were taken, what chance would the five roading contractors working immediately underneath it have had? Grady would have to buy a bigger desk to take the extra reminder portraits methinks.
The equipment on the poles seems to be far from pristine too. We havn’t even started to talk about that, but big transformers, and related gear don’t come cheap. It reminds me of a similar facility on Signal Hill Road when I was living there. The pipes coming out of the side of that transformer were entirely stuffed up with birds’ nests and guano. Rust was evident and corpses of birds without a mark on them were a common feature of the road and pavement below this rusting, buzzing facility.
Despite contacts over many years regarding this issue and the fact that the pole immediately outside my house was clearly rotted off at the base and was held up purely by its wires, nothing was done. Like many other poles along Signal Hill Road all the poles concerned seemed to have at one point supported the trolley bus wires. Trolley buses last ran up and down this route in 1979. I strongly suspect that the poles, most of which appear to be jarrah or something are contemporary with the start of mass housing development up Signal Hill Road in the late Nineteen Twenties.
A major earthquake would snap rotting posts off at their base, particularly when heavily top loaded like your photos.
“Mr Cull said the big question was whether the claims against Delta were valid.”
“He [Graham Crombie] would not comment on his thoughts as to the veracity of the accusations, saying: ”That’s what the review is about.”
What is all this prevaricating bullshit actually about? We have by now established that Richard Healey and Grady Cameron more or less agree that there are about 3000 unsafe structures on the network….give or take a couple of hundred…so the question of the veracity of the claims made is sorted. Admitted to. Out there at last. Nothing left to review now other than who let it get this bad, how is it all going to be fixed, and why was it necessary for Richard Healey to fall on his sword in order to protect the safety of his colleagues and others? If Mr Crombie or Mr Cull are truly interested in determining the context around those critical points then I expect they have been in touch with Richard Healey directly. Right?
Unfortunately not. Although both men claim to want to verify the information I have supplied, neither have made contact with me. I had thought that they may have been interested to find the extent of the problem, or to view the evidence, apparently not.
I can assure you that the extent of the the problem is far greater than just the poles. In fact, I chose the condition of the poles simply to illustrate the far greater problem of the condition of the network in general.
I am confident however that as long as they read a newspaper, listen to the radio or watch the television the message will, eventually get through.
You are correct, the number of poles rated condition 0 and condition 1 is no longer a point of contention. Aurora, through the CEO’s press releases, have confirmed that I am right. It was never in doubt.
My primary concern has always been the hazard that a deteriorating network represents to the people who work on it and to the community it serves. My community.
Greta, the chances of Crombie or Cull contacting Richard Healey are less than nil. They don’t want to know anything other than how to save their own skins, and the best way to do that is to either throw Cameron to the sword, or fight a combined strategy of “we didn’t know because the workers didn’t tell us”.
I’m not a legal beaver but what are the chances of Cameron and the Delta/ Aurora board facing a class action given their negligence and having already killed one man.
A manslaughter charge?
Better than average one would hope. Hence the now apparent race to the #1 position of most plausible deniability….
What was the finding of the Coroner? That would determine the likelihood of that course of action being successful.
From this site March 2014…
“When you take on a role as a director you cannot sit there passively,” says NZID’s Stuart McLauchlan. “You’ve got to understand what the risks are, you’ve got to understand the operations of the business, and ultimately you’re responsible.”
The man’s a prophet.
—
{Link to post: Delta blues…and Easy Rider -Eds}
Three reviews. Three Conclusions. Lessons learnt. Let’s move forward. We have heard it all before.
The same people stay on, to act on the reviews, till no one is looking out anymore. Same people ‘get over it’ and enjoy the next rugby games at the stadium which they spent money on instead….and continue to do so.
They must thank their lucky stars they don’t live in China where they could very well be executed for their sins.
Editor Barry Stewart on Channel 39 News this evening says the ODT will publish a map showing “the location of every dangerously compromised power pole in Dunedin”….
ODT Link to Map
Jezz. The ODT gona be a big one tomorrow to have a map covering Dunedin and Central Otago.
Received.
——– Original message ——–
From: Bev Butler
Date: 26/10/2016 2:20 pm (GMT+12:00)
To: Grady Cameron [Delta Utility Services Ltd]
Cc: Sandy Graham [DCC], Elizabeth Kerr
Subject: Urgent LGOIMA Request: Delta/Aurora dangerous power poles – reason for financial restraints
Dear Mr Cameron
As you are aware Aurora pay a subsidy of approximately $7.2 million per annum to subsidise the stadium.
At $5000 per power pole this is equivalent to 1440 power poles per year.
I read in the ODT that Aurora’s excuse for not dealing with the backlog of dangerously compromised power poles was that there were financial constraints but nowhere did it mention the reason for these constraints. It is patently clear that Delta/Aurora/DCHL’s priority over the last few years has been to support a rugby stadium at the expense of public safety by way of subsidies/subvention payments.
It is in the pubic interest that Delta/Aurora are transparent especially now that this has become a public safety issue.
I, therefore, urgently request the following:
The total yearly amount Aurora and/or Delta have paid to DCC/DVML/DVL for the stadium, including grants, subsidies, subvention payments or other, since 2007.
Given the total amount is in the vicinity of approximately $40 million, then it is incumbent on you as CEO of both Aurora and Delta to inform the WorkSafe investigation team that Delta/Aurora/DCHL made stadium payments a priority over replacing dangerous power poles.
Please also send me the name and contact email address of the WorkSafe investigation team leader as I want to ensure that the WorkSafe investigation team receive this relevant information.
Yours sincerely
Bev Butler
Further to Bev Butler’s letter, letters by others to WorkSafe have been sent in order to (paraphrasing) ensure WorkSafe knows exactly what it is dealing with.