Auckland’s integrated ticketing saga might seem like just another IT boondoggle with delays and cost blow outs.
But when the progress of Auckland’s public transport system is at stake, not to mention $98 million of public money, it is inevitable the public will want someone held accountable.
The Herald has pointed the finger at Snapper, saying the company should make its smart card compatible with the new integrated ticketing system or face the consequences.
Transport Minister Gerry Brownlee has threatened NZ Bus (which like Snapper, is owned by Infratil) could be “off the run”, losing the $70 million subsidy it gets for running 70% of Auckland’s buses if it can’t get the Snapper machines on its buses to work with the new system.
Back story: in 2009 Snapper lost out to French technology giant Thales in a competitive tender for the integrated ticketing system designed to be set up in Auckland and then rolled out in other centres. About a year later NZTA and Auckland Transport decided to allow Snapper to roll out its card on the NZ Bus fleet as long as it could guarantee compatibility with the new Thales-built system. There have been successive delays and things came to a head last week with a leaked lawyer’s letter from Auckland Transport to Snapper asserting the November 30 deadline would not be met and that Snapper was in breach of contract, with hundreds of thousands of dollars in extra costs piling up by the month. (For more history on this see Rudman, or Transport Blog if you are really keen.)
Snapper have been painted as the bad guy: losing out in a competitive tender, then sneaking back into the marketplace, and trying to use their dominant market position in Auckland to establish their card alongside instead of within the main system. The commercial incentive is obvious. If NZ Bus uses Snapper they get access to a sizeable cash float as public transport users charge up their Snapper cards. They also get a treasure trove of data about public transport journeys and consumption patterns that would help them wipe out competitors.
I think having a go at Snapper is too easy. We shouldn’t be surprised that a company aggressively competes for market dominance.
But we should expect our politicians to make decisions in the public interest, and not screw the scrum on behalf of private interest which seems to be what happened here. I’ve been told by former board members of both agencies that then transport minister Steven Joyce intervened on behalf of Infratil, putting pressure on both boards to let Snapper roll out their card in advance of the new system.
Last week in the House Gerry Brownlee denied his predecessor had any role in the decision making, saying it was a decision for Auckland Transport and NZTA.
Both Mike Lee, former chairman of Auckland Regional Council, and Michael Barnett, also a former elected member of the ARC, have publicly said that lobbying of and by central government politicians led to what has turned out to be a very unwise decision.
That is why I have asked the Auditor General, who is already investigating Auckland’s integrated ticketing project, to include an examination of the role of central and local government politicians in the decision making around Snapper’s early roll out.
And Sneaky Steven Joyce strikes again. Now that he is in charge of a ‘Super Ministry’ will he be Super Sneaky Steven? THe man is a very nasty menace to our country.
why did auckland ratepayers fund an integrated ticketing system when a private company already had one in other centres and was offering to provide the service beyond its own fleet, not just in Auckland?
if people are worried about a private company having undue influence, there are other ways to deal with this, but bankrolling a rival French-built (!) system and then insisting that the incumbent (snapper) must re-engineer to become compatible by an arbitrary deadline seems more than a little harsh.
You might be right marsman. Much is made by the ‘right’ of past successful business experience as a good background for ministers. Business is often cuthroat and may work at the edge of honest and ethical practice. Cabinet ministers must exhibit absolute propriety. The ‘super ministry’ with Joyce as minister is a worry. How by any reasoning is fisheries in there? Should we expect to see quota managment principles slip.
We have Key`s Casino Capers too of course.
Sorry – I am confusing with the new MAF … With fisheries – so sorry for that Steven!? Same worry though… Fisheries has little affinity with land based Agriculture and Foresry — And of course Forestry was badly served for along period by its earlier amalgamation with the Ag giant.
Why are cabinet ministers directly interfering with commercial deals? No matter how you cut it, it’s corrupt. We have an impartial and independent process to handle such deals, in local and central government. Ministers are supposed to stay well away. When did the rules change?
@jennifer
agreed, seems Ministers turned up late and are now contributing to a pile up. is it just an opportunity to look ‘authorititive’?
@ Ben, it’s more about looking corrupt, than authoritative. Ministers should not be involved, period. As a certain minister keeps saying, its an ‘operational matter’. Ministers should be simply advised of the outcome. So when did the rules change so they could get directly involved in commercial deal making?
Snapper is a rort. The cards cost a bomb and because they are too thin they are not acceptably durable. Auckland doesn’t need that sort of dogware and Wellington would do well to get shot of it as well.
“when did the rules change?”….. There hasn’t been any change in the rules…. This is pretty traditional national party politics….
”
The lord helps them who help themselves” has been a very fundamental national party tenet since it’s inception…considering the factions who created the party, then it’s a sure bet the misuse of that principle was one of the reasons for the creation of the party in the first instance….
Why are we still acting surprised when they indulge in corrupt, dishonest practices??
“In the public interest”
Sorry, thought this thread was about richard worth
@ jennifer & bbfloyd
Absolutely agree.
Politicians of all shades must obviously walk a difficult path, and basic integrity is esential in their makeup
My take is that most of those of the left at least entered public life wanting to help ordinary citizens (I hope), wheras those of the right seem to have entered to aid and maintain wealth and privilege , and particularly so for themselves and friends. Business acumen is important of course, but it often comes with baggage.
So my leanings are, as they say, “a no brainer”.
I see the Nat`s ‘Sale of ESSENTIAL Assets’ as little more than a state gift to those who choose to buy, and who will clearly be, in the main, supporters of Key and Co. The huge windfall of course will be when the gov`t ‘finds out’, that for perhaps some legal or other reason, that they will be ‘required’ to sell more than 50% and we lose control?
As for ‘Snapper’ and other stuff – It almost seems like many commercial decisions of this govenment need continuous and very scrupulous auditing – Now there would be a ‘superministry’ for Joyce – but I doubt he would be interested.
@Aliens ” “In the public interest”
Sorry, thought this thread was about richard worth”
Me too, then I realised when it comes to corruption Taito Philip Field may win that particular prize eh?
Good job he was stood down, excluded from caucus, de-selected and soundly beaten at the 2008 vote by Labour’s candidate.
All that transparency, you just know it wouldn’t happen under merchant banker inc.
Want to know what the real problem is?
It’s the government:
1.) Not setting compatibility standards that the cards needed to adhere to
2.) Not maintaining control of the systems used for the accounting and transference of our currency
When we leave these things to private industry we get corruption and inflated prices to boost profit – just as has been proven, once again, in the LIBOR rates scandal.