A consultant paid nearly $30,000 for a failed marketing strategy

The government paid $28,613 for key advice that shaped its disastrous Three Waters ad campaign last year.

Kim Wicksteed, consultant and former CEO of advertising agency Saatchi & Saatchi New Zealand, was paid $25,024
a “marketing and communication” strategy, delivered in December 2020, for the government’s water infrastructure reform program, known as Trois Eaux.

Additionally, Wicksteed received $3,588 for participating in the “Three Waters Reform Program Critical Friends Advisory Group” last year (both figures include GST and were paid to Wicksteed’s individual advisory firm Advice Ltd).

Wicksteed’s strategy has shaped a controversial “public information and education campaign” that has so far cost the Department of Home Affairs (DIA) some $3 million – not including the cost of staff and consultants . The campaign ultimately failed in its main objective of obtaining, through public support, the voluntary agreement of the municipalities to adopt the government’s reform program for rainwater, wastewater and drinking water.

The ministry released the figures under the Official Information Act.

Wicksteed recommended a communications strategy that focused on “emotional marketing” first rather than a more traditional “information first” public service style campaign.

According to Wicksteed’s advice, the communication plan was aimed squarely at eliciting an emotional response rather than providing information. At the center was a paid advertising campaign to promote the need for Three Waters, produced by creative agency FCB New Zealand.

Local government officials overwhelmingly denounced the advertisement, with some calling it “incitement to fear” and “propaganda”.

It also prompted warnings from the Civil Service Commission that the adverts were “worrying” in light of government advertising guidelines which state that such work should only be undertaken to meet a need for “identifiable and justifiable” information.

The ad, which aired on TV, in print and online, featured among its cartoons a drooling child swimming, a sick duck and other dirty, unhappy creatures; he also warned against “bad guys in the water”.

The Public Service Commission said it had not had a chance to review the first advertisement, which it expressed concern about. A second advertisement was reviewed by the commission and edited before airing, and a third was canceled before being used.

DIA deputy chief executive Michael Lovett said the “critical friends” were an advisory group, not a decision-making body. “His expertise and guidance helped shape the elements of the campaign and provided a sounding board for content and direction. Not all individual viewpoints could always be considered and ultimate accountability of television advertising content remained with the Department”.

Most of the group’s members were drawn from the staff of the Department of Home Affairs itself and from the ranks of consultants paid or recently paid by the department. It also included Avon Adams, then senior press secretary to local government minister Nanaia Mahuta. Those from the public sector or local authorities were not remunerated for their contribution.

Among the “critical friends” who were paid consultants (or recently paid consultants) to the department’s Three Waters unit were: Raphael Hilbron, a partner at the public relations consultancy SenatorSHJ, whose specialty is managing the reputation; Jennie Smeaton, DIA’s full-time contractor until April 2021, and at the time of “Critical Friends” meetings, Chief Operating Officer of Te Rūnanga o Toa Rangatira, the iwi mandated authority for Ngāti Toa Rangatira; Katy Te Amo, consultant on Maori issues to the DIA in 2020 and, since January 2021, responsible for the strategy and ideas of the new drinking water regulator Taumata Arowai, a Crown entity; and Wicksteed.

It is unclear how much Smeaton and Hilbron were paid for their work. A department spokesperson said: “[their] participation in the Critical Friends advisory group was part of their wider advisory work for the Home Affairs Department.

It appears that the group was belatedly augmented by voices from outside the central government. Late additions, following the launch of the TV advert and heavy criticism from local councils, were Susan Freeman-Greene and Bridgit Sissons of Local Government of New Zealand (LGNZ), and Nigel Corry, Chief Executive of Greater Wellington Regional Council . Corry said he did not consider himself a member of the group but, by invitation, he attended its last meeting.

“After the ads ran, we were added to the Critical Friends advisory group [in time only for its final meeting]Chief Executive of New Zealand Local Government, Susan Freeman-Greene, confirmed: “We have repeatedly provided feedback to say that the adverts were provocative and had landed very badly in the area. [which] found them insulting. As a result, we have called for the campaign to be halted.”

Lovett said the group met four times, in May, June and July 2021, and consisted of 18 members (names listed below), who attended at least one meeting.

Freeman-Greene noted that his group received “high-level concepts” from the ad campaign just before it went public, thanks to his involvement with a different group: the Three Waters Steering Committee.

The only other local government representative elected to the “Critical Friends” group was Central Hawke’s Bay Mayor Alex Walker.

“I’ve been in a few brief meetings with this group. I’ve seen the first concepts, but never the full TV commercial or copy. Some of the critical feedback I’ve given has resulted in small changes, but it was always very clear that ownership of strategy and decision-making belonged to the DIA,” Walker said.

Heather Shotter, then chief executive of Palmerston North City Council, who joined DIA last month to lead the National Transition Unit tasked with advancing planned structural changes at Three Waters, and James Palmer, chief executive of Hawke’s Regional Council of the Bay.

Where to go from here?

A special unit within the DIA is leading the government’s plan to merge council-owned water infrastructure for drinking water, stormwater and wastewater into four regional bodies, and heavily dilute broad public ownership of these assets through new and shared control with iwi (control is generally considered an important test of ownership).

The government argues that consolidation is necessary to allow for greater borrowing on water-related assets to fund the necessary investments that will amount to more than $120 billion over the next 30 years. It also says the reforms would result in better quality water services, including ever cleaner drinking water.

Many councils and observers agree that changes are needed, including more consistent investment and maintenance of the country’s pipelines. However, there is general disagreement on whether the reforms planned by the government will achieve their lofty goals.

While Wellington initially promised local councils could opt out of the reforms, he changed his tune late last year when it became clear the overwhelming majority of local councils opposed the government’s plan .

Mahuta now says new legislation to be introduced this year will enforce the changes, although she is considering some revisions recently recommended by a task force of elected local government and iwi members.

If passed, the amendments would restore some board control over the proposed regional water bodies. However, the plan retains the controversial proposal to dilute public control of water assets, through the new governance model shared equally between councils and unelected Maori groups.

The government says removing asset ownership is necessary to stay ahead of lagging infrastructure investment and to consistently deliver good water services across the country.

Members of the Advisory Group of Critical Friends of the 2021 Three Waters Reform Agenda (names provided by DIA):

•Michael Lovett, Deputy Chief Executive of Local Government, DIA
• Allan Prangnell, Executive Director, Three Waters, DIA
•Nick Davis, Policy Officer, Three Waters, DIA
• Kim Chambers, Director, Office of the General Manager, DIA
• Louise Yarrall, Acting Director General of Communications, DIA
•Simon Cunliffe, Three Waters Communications Manager and Facilitator of the Three Waters Reform Program Critical Friends Advisory Group, DIA
• Raphael Hilbron, Associate at SenateSHJ, (undisclosed compensation per contract with DIA)
• Jennie Smeaton, independent consultant Te Ao MĀori (undisclosed compensation under contract with DIA)
• Kim Wicksteed, Advice Ltd (paid $3,588 “as per DIA’s Cabinet Office CO(19)1” circular)
•Avon Adams, Senior Press Secretary to the Minister of Local Government
•Alex Walker, Mayor of Central Hawke’s Bay
• Heather Shotter, Chief Executive of Palmerston North Town Council
•Katy Te Amo, Head of Strategy and Ideas, Taumata Arowai (2020 employment contract with DIA)
•Caroline Robertson, Communications Manager, Taumata Arowai
•Susan Freeman-Greene, Chief Executive, Local Government New Zealand
• Bridgit Sissons, Deputy Chief Executive of Communications and Engagement, Local Government New Zealand
•Nigel Corry, General Manager, Greater Wellington Regional Council
• James Palmer, General Manager, Hawke’s Bay Regional Council