CRLL Statement of Intent

City Rail Link Limited Statement of Intent For Financial Years 2017 – 2025

________________________________________________________________________________________ INTRODUCTION

This Statement of Intent (SOI) sets out the activities and objectives of City Rail Link Limited (CRLL) for the period 1 July 2017 to 30 June 2025.

Sir Brian Roche

Anne Urlwin

Chair

Director

22 December 2017

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OBJECTIVES OF THE CITY RAIL LINK PROJECT The City Rail Link Project (CRL or Project) is a significant infrastructure project to enhance the capacity and performance of Auckland rail services and improve transport outcomes in Auckland.

The Project comprises a 3.45km twin tunnel underground rail link from the existing Britomart Transport Centre connecting to the Auckland Rail Network at a redeveloped Mt Eden Station with two new stations at Aotea and Karangahape.

The Crown and Auckland Council (Shareholders) have agreed to co-fund and partner on the delivery of the Project, and collaborate on other initiatives, with the following overarching objectives: •

improve transport access into and around the Auckland City Centre for a rapidly growing Auckland;

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improve the efficiency and resilience of the Transport Network of urban Auckland;

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significantly contribute to lifting and shaping Auckland’s economic growth;

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provide a sustainable transport solution that minimises environmental impacts;

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contribute positively to a liveable, vibrant and safe city; and

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deliver the Project with a ‘best for Auckland’ approach.

________________________________________________________________________________________ OBJECTIVES AND PURPOSE OF CITY RAIL LINK LIMITED CRLL’s primary objective and purpose is to manage, deliver and complete the Project in accordance with the terms set out in the Project Delivery Agreement dated 30 June 2017. CRLL will not carry out any other business without prior written unanimous Sponsor approval.

The Sponsors are the shareholders of CRLL. The Sponsors have, through a Sponsors’ Agreement dated 30 June 2017, agreed to fund the development and delivery of the Project by CRLL. As set out in the Sponsors Agreement, the Sponsors also wish to work together in relation to the wider benefits associated with the Project and any future rail investment and the ownership and operating structure of the wider Auckland transport network. ________________________________________________________________________________________ NATURE AND SCOPE The Project was previously governed and managed by Auckland Transport (AT) from 2011 to 30 June 2017.

The Shareholders incorporated CRLL on 13 April 2017 to deliver the Project in accordance with the Project Delivery Agreement, entered into by the Sponsors and CRLL, and the Sponsors Agreement entered into by the Sponsors. The Sponsors Agreement sets out the arrangements between the Sponsors for the governance of the Project and their relationship as its co-sponsors. The Sponsors Agreement states “the Sponsors also wish to work together in relation to wider benefits associated with the CRL Project and any future rail investment and the ownership and operating structure of the wider transport network.”

The scope of the Project is summarised in Schedule 2 of the Project Delivery Agreement. ________________________________________________________________________________________ RISK MANAGEMENT The Board and Management will encourage a culture that is risk aware and CRLL will seek to understand and mitigate risk where it is identified.

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CRLL will maintain an active and regularly updated register of strategic and operational risks, managing these risks through an agreed management process with oversight from Management and the Board. _______________________________________________________________________________________ FUNCTIONS AND OPERATIONS The Board provides governance and assurance that Management is delivering the Project in accordance with the objectives of the Project. The Chief Executive has appointed a leadership team to provide direction and oversight to the activities of the Company.

CRLL is responsible for delivering New Zealand’s first underground passenger rail project. This includes consenting, land acquisition/disposal, community engagement, procurement and management of the contracts required to complete the Project. CRLL will work with key stakeholders to deliver the objectives set out above.

The Project is divided into a series of workstreams encompassing Property & Planning, Sustainability, Operations, Design, Architecture, Engineering, Construction, Safety Assurance, Business Case/Funding, Procurement, Transaction Management and Programme Management supported by Corporate Services. The team structure is adapted progressively in keeping with the evolving requirements of the Project through its lifecycle.

CRLL’s activities are guided by policies and procedures that ascribe to effective corporate discipline.

The key Project operational activities comprise nine construction contracts which are summarised below. The first three contracts are underway: C1 - Awarded in July 2016 to Downer Soletanche Bachy JV for creation of temporary Britomart station passenger facility and construction of tunnels from below Britomart to DowntownShopping Centre (DSC) DSC - Precinct Properties Ltd is developing its site (retail and tower) and constructs the CRL tunnels across the site C2 - Awarded in June 2016 a cut and cover contract to Connectus (McConnell Dowell Hawkins JV) for works from DSC to the Wyndham St intersection on Albert St and pipejack contract (separable portion) awarded in December 2015 to Connectus for the relocation of a stormwater line on Albert St and strengthening of the Orakei Main sewer which cuts across Albert St C3 - Tunnels and stations (Aotea Karangahape Road, Mt Eden) and tunnels from just south of Wyndham St to North Auckland Line at Mt Eden C5 - Connection of tunnels into existing North Auckland Line live rail corridor enviornment C6 - Stormwater replacement in Mt Eden prior to start of C3 and C5 works C7 - Rail systems, integration, testing and commissioning from Britomart to Mt Eden Station C8 - Additional platforms at turnback facilities at Otahuhu, Newmarket, The Strand and Henderson C9 - Additional connections and stairs, platform widening and track modifications in East Britomart to be commenced once CRLL is operational The Company has been established with the understanding that its primary purpose is to deliver the Project, and has a finite life span. ________________________________________________________________________________________ ORGANISATIONAL HEALTH & CAPABILITY Health and Safety As a Crown Entity operating in a construction environment, CRLL will be a leader of health and safety and ensure compliance with the Health and Safety at Work Act 2015.

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CRLL is committed to a culture that holds safety as a core part of the Company’s identity. It will do this through: •

the Board and Management modelling behaviours that it expects from its staff and contractors;

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establishing best practice health and safety approaches in the field and in the office environment, monitoring adherence to these practices and taking immediate corrective actions, if required;

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ensuring that the Company, and those who are working for the Company, meet all health, safety and environmental regulatory obligations.

Capability Development CRLL will support its staff to achieve the Company’s objectives and purpose, by: •

developing the team for their current roles, providing flexibility to move staff to other roles in the Company, and preparing staff for their next career steps;

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regularly reviewing the capability of its people to align the available skills with the requirements of the Project development lifecycles;

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achieving high levels of staff engagement;

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providing a safe environment for staff;

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developing skills required to achieve the Company’s objectives in a cost-effective manner;

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providing staff with reliable, secure and cost-effective technology; and

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providing a sound financial and internal control environment.

Ensuring CRLL is a Good Employer The successful delivery of the Project will depend on the technical, commercial and financial expertise of CRLL. It is important that CRLL attracts and retains skilled staff, is a good employer and offers an attractive place to work, with a culture that is valued by employees and supports the Company to deliver on its objectives. ________________________________________________________________________________________ ASSESSING PERFORMANCE CRLL commenced its first year operating as a company on 1 July 2017. It has an established baseline of Project costs developed under the governance and management of AT and summarised in the Project Delivery Agreement.

Reporting against the baseline will assist Management and the Board in implementing the Project and keeping the Shareholders informed of progress.

CRLL will report regularly to the Shareholders, and to the Sponsors as set out in the Project Delivery Agreement. ________________________________________________________________________________________ OTHER STATUTORY REPORTING REQUIREMENTS Governance Organisation Form Incorporated under the Companies Act 1993, CRLL is a majority-Crown-owned entity and is listed under Schedule 4A of the Public Finance Act 1989 and Part 2 of Schedule 1 of the Ombudsmen Act 1975. In addition, the Public Finance Act 1989 applies several provisions of the Crown Entities Act 2004 to CRLL, as if it were a Crown entity under that Act. CRLL's shareholders are the Crown, acting by and through the Minister of Finance and Minister of Transport, and the Auckland Council.

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The Crown holds 51% of the voting shares in CRLL, while Auckland Council holds the remaining 49%. CRLL is not treated as a Council Controlled Organisation.

CRLL has had the Project transferred to it, with each Shareholder contributing 50% of the Project cost to date.

Funding will continue to be by way of equity contribution on a 50/50 basis.

Board of Directors The Board is committed to a high standard of corporate governance and regulatory compliance in guiding and monitoring CRLL's activities. It is currently made up of five Directors, who have been appointed by the Shareholders, following Cabinet and Auckland Council Governing Body approval.

The Board will carry out its accounting, reporting, risk management and responsibilities in accordance with applicable legislation.

CRLL's directors will comply with their obligations under the Companies Act 1993, the Crown Entities Act 2004, the Public Finance Act 1989 and other relevant legislation.

The Chief Executive, who is accountable to the Board, has responsibility for the management, operation and administration of CRLL. The Company has in place a suite of policies that underpin its objectives and mandate and which provide a link to day-to-day company operations.

Shareholders CRLL maintains relationships with its Shareholders in a manner which respects their roles, responsibilities and expectations Crown Entities Act Requirements CRLL is subject to various sections of the Crown Entities Act as set out in its Constitution, including the collective duties of the Board to the Crown and Shareholders; interface with the Companies Act 1993; directions from Ministers to support a whole of government approach or under statute; provision of information; employment; and restrictions on financial products, borrowing and giving of guarantees and indemnities.

Other Statutory Requirements In addition to the Crown Entities Act, Companies Act 1993, Public Finance Act 1989, there are various other Acts that apply to CRLL, including the Anti-Money Laundering and Countering Financing of Terrorism (Requirements and Compliance) Regulations 2011, Crown Organisations (Criminal Liability) Act 2002, Hazardous Substances and New Organisms Act 1996, Land Transport Management Act 2003 and Public Audit Act 2001. CRLL is committed to complying with its oligations under all legislation.

Under the Public Audit Act 2001, the Controller and Auditor-General is the Auditor of CRLL. ________________________________________________________________________________________ ADDITIONAL INFORMATION Settlement Agreement Sponsors Agreement Project Delivery Agreement All of the above documents and more information on the Project and the Company are available on the Project website, www.cityraillink.co.nz

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