This morning’s Sunday Star Times reveals that Transpower spent $2.2 million on overseas travel in the middle of the recession. Between July 2008 and November 2009 they spent $1.3 million on overseas airfares and another $900,000 on “travel expenses”.
To put that into context, all government ministers (including those outside Cabinet) collectively spent about $2.6 million on overseas travel during 2009. I understand the need for Transpower to tap into expertise from overseas, but this just seems excessive.
When coupled to the fact that 309 of their 567 staff earn over $100k a year, they spent $5.1 million on staff bonuses in the past year, and more than $1 million on public relations, it does start to paint a picture of an organisational culture that can’t be justified.
Hard working kiwis who have been seeing their power bills steadily increasing in recent years will be rightly annoyed with this.
On topic please Trevor
Chris
Yes it certainly paints a picture of an organisational culture that can’t be justified. However I do like this new standard of openness and accountability that we are starting to see with the current govt.
Hard working Kiwi’s have been complaining about steady increases in their power bills for more than a few years. It would be interesting to compare Transpower’s apparent excessive spending over the last 10 years to determine if this really is a sick organisational culture or simply a bad looking snap shot. On top of that it would be interesting to see what visibility of this spending various ministers had over that time and what was done before this current revelation.
Surely the CEO would be embarrassed?
See your point re the culture, but linking the spending to high power bills suggests you don’t really get the scale of the electricity market. Transpower’s prices are under close control by the Commerce Commission (they can’t raise them above a certain pre-approved amount) and they can only spend money on big projects that are approved by the Electricity Commission.
Transpower costs comprise around 10% of the average electricity bill. They are due to spend several billions (not millions) on much needed grid upgrades and this will increase their costs up to around 12-14% of the bill. The numbers you quote seem large but in the wider scheme of things if they cut salaries by 50% and international travel to zero, nobody would notice the difference in terms of their power bills.
Sorry chris i agree with you on many things but the comment on half the staff being on over 100K is unfair.
How many of these staff left similar pay in the companys that service teh trasmision lines to take up position in Transpower.
These are highly trained people who in many cases could get back out into the feild and work on the lines. These arent pencil pushers.
What i would ask you to look at more closely is not the overall bill of the travel, but the type of airfares purchased and the accommodation used. Im sure as an MP you will realise that traveling alot is not fun, and gets to the point where you dread it.
A result of the corporate culture that Roger Douglas and the 4th Labour government ushered in.
Burt – I’m not sure it is a ‘new’ culture of openness and transparency, I just think people (and the media) are taking more notice. There are notable exceptions, such as MP travel and expenses which were previously secret and are now out in the open (not a govt initiative but a move supported across the political spectrum). Re ministerial travel, the figures for the past 10 years are all publicly available through answers to written questions, nowadays they’re routinely published which I think is better.
JMK – I do understand the scale of the electricity market, it’s the principle at stake here not the amount. Your argument could easily apply to MPs/Ministers expenses (eg. it’s less than a few cents per taxpayer, so if we did away with it all no taxpayer would notice the difference). I don’t agree with that take, even if it’s a small amount in the grand scheme of things it’s still important to be seen to be acting responsibly and with a high degree of prudence.
Waterboy – I acknowledge that Transpower is a specialist technical employer, so one would expect salaries to be higher, but half over $100k, not sure about that. As for the travel, yes, I find work-related travel is often exhausting!
Maybe they have so many highly paid people because they have contracted out all the low paid stuff to contractors. They instead operate a core of experts who manage suppliers. It’s just envy politics to say they have too many people over 100k. How many should they have? Oh and how much do you and your caucus colleagues earn BTW?.
But rather than pick up on silly things like travel – they are a major corporate in NZ terms and international exposure to new technology is very important to their ongoing business – wouldn’t it be better to focus on the actual management of the system. How well are they doing? Are we just chucking money at them and hoping without any clear idea of what the problem is and whether that is the best use of the money? What actually caused the recent powercuts in Auckland? LAck of investment or poor controls and management?
Why object to this and not the gutting of the Electricity Commission which was the only control over their monopoly business? You lot were pretty quiet on that even though you set it up. Now there is very little control on TP so expect the empire to be less worried about what you and I think or the impact on our bills.
To be honest I don’t see this as an issue.
Like any big organization Transpower surely sends employees overseas to learn about new technologies, supervise the manufacture of pieces of plant, go to conferences, learn what similar companies are doing overseas etc. In fact, it would be alarming if Transpower wasn’t doing this sort of thing.
$2.2M doesn’t seem like a whole lot of money in the context of a large(ish) company. The salaries don’t seem wildly out of wack either. Sure, the company looks a bit top heavy on managers, but that is probably to do with contracting out the low paid jobs.
Disclaimer: my brother works for Transpower.
I seem to recall National being outraged when it was revealled how many people at SPARC received over 100K, of course the media and Key used incorrect figures but their outrage remained.
Perhaps someone could ask them why this is so different?