Hindsight is a wonderful thing, affording as it does the most glaring and uncompromising of perspectives. With the aid of a review of the Dunedin City Council's trading companies, it is now clear just how inadequate the governance structure of those companies had become.
The report, conducted by independent reviewer Warren Larsen, identified a "high level of dysfunction" in the umbrella organisation, Dunedin City Holdings Limited (DCHL), and financial problems with the potential to become "very serious", if they had not already.
The diagnosis confirms the basis for widespread public concern, historical and recent, in relation to the debt of those companies, and their governance.
In particular, the revelation of an $8 million shortfall in the dividends the companies were able to pay to the council, and in the fact the companies were having to borrow to meet their dividend commitments, led to robust inquisition by outside observers ahead of the review's release. Equally in the firing line was the number of city company directors, their levels of remuneration, and the duplicated roles they held on various of the companies' boards.
It is a welcome report because, finally, it not only spotlights perceived shortcomings but makes firm recommendations as to the way forward. And while there is always a tendency to scapegoat in such matters, Dunedin Mayor Dave Cull seems to have set a conciliatory tone in suggesting the issue was not about "saying anyone has done something wrong, but that the system has come to a point where it is no longer appropriate".
Recrimination is easy, constructive action more difficult even if, as council critics might point out, Mr Cull might well take this approach given he, and other councillors, were on the last council when matters were deteriorating and they did little about it.
They might have a point, but the last council, too, inherited a board structure and a governance environment that seemed adequate then - but self-evidently is no longer. It is also true Mr Cull did not sit in the leadership role he now has. The important point is problems have been categorically identified and now must begin the task of rectifying them.
Mr Larsen's findings on the governance "problems" was they had indeed existed for some time, but had become more obvious and critical because of a need to fund several major infrastructure projects at the same time.
To address this perceived failing, the review made several important recommendations. It suggested councillors may not hold directorships in DCHL or its subsidiaries; nor should senior council managers. This makes perfect sense and - without imputing failings on the part of current directors - it is difficult to argue the arrangement as it has stood did not - at least potentially - put those councillors who were also directors in a position of conflict.
There would appear to have been scope for duplication in having directors on both DCHL and its subsidiaries. Sources with wide experience in such matters say this is at best an unusual practice and the report concurs, recommending it should cease.
In speaking to the review, Mr Cull said it was important to distinguish between its recommendations and its "opinions", and while it appeared the council accepted the recommendations there was some debate over the issue of nationally recruited directors for a reconstituted DCHL board. DCHL chairman Paul Hudson argued it was "an insult to directors that work in Dunedin" to suggest there was nobody in the city capable of looking after the interests of the holding company.
But that is to miss the point: an outside perspective, together with experience from other centres, would surely be a useful addition and do much to dismiss claims of conflict or special interest. Whether there need be three national recruits is another matter.
Similarly and rightly the council raised issues with the conclusion - which fell into the category of opinion - that asset sales were necessary. This is a thorny issue and one over which decisions should not be made in haste.
In some respects it mirrors the national debate and there are points to be made for and against. Sales would reduce council debt, but also diminish the prospects for future income from those assets. This is one issue arising out of the report that should be revisited.
