Cr Chris Staynes made the claim yesterday, even as his fellow councillors appeared divided over whether spending by staff was out of control or a media-driven storm in a teacup.
Cr Staynes yesterday told the Otago Daily Times he voiced concerns after noticing the number of staff meeting in city cafes "whenever you went into them during the day ... it did not matter what time."
He said his concerns were raised with Mr Harland during a meeting with other members of the council's executive management team in late 2008, held to discuss budgets for the following year's annual plan hearings.
"I did make the chief executive aware of my concern with the number of city council employees that were in local coffee shops around the city centre."
Cr Staynes said there "wasn't any significant reaction" from Mr Harland at the time, and nothing appeared to have changed since.
"I haven't seen anything change."
Mr Harland said when contacted yesterday he did not recall the conversation, and therefore could not recall acting upon it.
However, he said issues of inappropriate spending were usually picked up first by managers below him, and insisted changes had occurred in the past year.
"Certainly in the case of one or two staff their behaviour did change in the last year as a result of managers picking them up," he said.
He stressed staff meeting in cafes were still engaged in council business. On occasion, they were prompted to leave the office because of a shortage of meeting rooms within the council's Civic Centre office.
"I'm confident they were discussing work-related matters."
Cr Staynes said he believed the problems "should have been picked up earlier", and would be calling for an investigation seeking to tighten the rules at the next council finance and strategy committee meeting, in August.
He questioned whether having 206 credit cards spread across the council was beneficial.
"There seems to be an awful lot of credit cards in the organisation. The more you have, the more chance you have for inappropriate use."
Mr Harland reiterated their benefit in helping reduce accounting costs, and stressed the other efforts made by councillors and staff to reduce costs and lower forecast rates increases, which saved millions of dollars, year after year.
"The big picture is under control," Mr Harland said.
His comments came after an ODT request for information prompted the council on Monday to reveal details of $534,500 in credit card spending by 36 of its senior managers and four PAs over the past three years.
Spending worth millions of dollars more was contained on another 166 staff cards, details of which are yet to be divulged but which have also been requested by the ODT.
Analysis of the council's figures yesterday showed council staff had spent more than $44,000 in central city restaurants, cafes and bars - most of them in the Octagon - for a variety of meetings and functions.
Several councillors leapt to the defence of staff yesterday, with Cr Michael Guest saying he did not see "any issue at all" with the spending, other than the $7000 worth of questionable coffees already addressed.
"We are not running a corner store dairy. We are running a $200 million dollar city."
Cr Paul Hudson said the ODT's coverage was misleading as it implied all the expenditure was personal "and that's simply not true" Cr Bill Acklin said the spending was being "absolutely totally blown out of proportion".
Crs Fliss Butcher, Teresa Stevenson and Dave Cull were among those to express concern.
Cr Butcher was "surprised to see the scale of it, particularly coffee drinking".
"It does seem excessive to me ... especially the executive managers who do get good salaries. Why aren't they paying for these things themselves?"
Cr Staynes said in his former role, as a general manager for Fisher & Paykel in Dunedin, it was made "very, very clear" all spending on company credit cards had to be justified.
"There's no way putting things like coffee on a credit card would have been permitted."
Other councillors - and Mayor Peter Chin - were more circumspect, saying the matter was being handled appropriately by Mr Harland.
Asked yesterday what was happening with the other 166 credit cards, Mr Harland said he expected to receive transaction lists and would scrutinise each, line by line, looking for inappropriate expenditure.
• Is council credit card spending out of control? Email your views to chris.morris@odt.co.nz
