The NZ Transport Agency has published the findings of an independent investigation into the management, governance and functioning of the agency’s former Connected Journey Solutions (CJS) business group.
The independent review of the NZTA’s innovation and technology unit was commissioned from Deloitte Consulting in March 2019.
NZTA interim chief executive Mark Ratcliffe says the review was initiated in response to a range of concerns relating to the management, governance and activities of the CJS group, which were identified as part of an overall assessment of the agency’s functions undertaken after his appointment in January 2019.
“That assessment and feedback provided by staff made it clear that there were serious concerns with the way the group had developed and operated. The Deloitte investigation was commissioned to provide an independent assessment of the risks as well as the opportunities associated with the group, and to provide recommendations which could be swiftly implemented to put things right. All of the report’s recommendations have been or are being implemented,” Ratcliffe says.
The Connected Journeys Solutions group was set up in October 2016 as a small business unit within the NZTA, to focus on developing technology innovations.
However, the Deloitte report found that CJS grew rapidly and ‘created its own culture and ways of operating.’ The report also confirms there was an ‘extensive disregard’ of proper processes for business, finance, governance, procurement and staffing within the group, largely as a result of the leadership of the former CJS director and the relationship between the director and the former CE.
Ratcliffe says while ring-fenced ‘innovation hubs’ are an increasingly common feature of large organisations, including those in the public sector, the encouragement of innovation must be balanced by strong systems and processes to ensure there are high levels of transparency and accountability.
“The Deloitte report makes it very clear this was not the case within the CJS group. The group was allowed to ignore many of the Transport Agency’s own processes and rules. That is not acceptable, and we have moved to address these issues to ensure that these mistakes are never repeated. I also want to acknowledge the open and honest contribution from many individual staff, who tried to raise these concerns before I arrived. They acted with courage and integrity and the findings of this report should not be seen as a reflection on them.”
Ratcliffe says the CJS group has now been disestablished and its functions are currently being managed within the NZTA’s operations group. The former director of the CJS group resigned from the agency in March 2019.
Ratcliffe noted that while the Deloitte report identifies serious issues with the way CJS’s business was carried out, it also recognises the value of successful products developed by the group, including the Weigh Right tool which uses data and technology to strengthen the NZTA’s regulatory function, and the pilot and development of mobility-as-a-service apps.
The work undertaken by CJS has also advanced the use of data for traffic management and the provision of travel information to the public, and the agency will continue its work in this area.
The Deloitte Consulting report can be viewed at: https://www.nzta.govt.nz/assets/About-us/docs/deloitte-review-of-cjs-may-2019.pdf