1: Our inquiry

1.1
We have considered the decision-making process followed by the Christchurch City Council (the Council) in deciding in July 2008 to purchase certain properties in and around central Christchurch. The properties cost about $17 million, and were acquired by the Council from companies connected with one property developer.

1.2
We carried out our inquiry under section 18(1) of the Public Audit Act 2001, which provides that the Auditor-General may inquire into any matter concerning a public entity’s use of its resources.

1.3
We reviewed the process followed by the Council and its staff in deciding to purchase the properties. We reviewed relevant documents, and held discussions with some Council staff and Councillors. We have not discussed this matter with the property developer, as our inquiry focused on the actions and processes of the Council.

1.4
Through our discussions, we have noted a number of different views. We have not set out all of these views in this Appendix. In some instances, we have referred to views from particular individuals.

1.5
We are aware of many different concerns being raised about the Council’s decision to purchase these properties. Some people wrote to us about their concerns, and we also took note of the issues being raised in the media. However, not all are of relevance to the Auditor-General, and not all are dealt with in this Appendix.

1.6
We have noted comments about this decision and about our inquiry that suggests a misunderstanding of the Auditor-General’s role in this area. Our Office is not a general appeal authority or complaints agency that the community can turn to if it is unhappy with a decision competently reached by its local authority. Under the Local Government Act 2002 (the Act), local authorities have a power of general competence and a substantial measure of discretion in making decisions within a specified decision-making framework. It is not our role to second-guess how local authorities exercise their powers and fulfil their responsibilities.

1.7
We focused this inquiry, consistent with our role and mandate, on whether the overall approach the Council took in making this decision was broadly sound and consistent with the requirements of the Act, and was in keeping with good practice.