Singapore Airlines expresses 'serious concerns' about council funding leak
The leaking of details of a multi-million dollar subsidy for Singapore Airlines flights into Wellington has "undermined" Wellington City Council's relationship with the airline, leaked emails claim.
In the days after Singapore Airlines and Wellington International Airport announced a new service linking the capital to Canberra and Singapore, documents emerged showing the council had agreed to subsidise the service.
While the document - a presentation given to councillors the day the flights were confirmed - gave only a basic outline of the agreement, it appears the council's Destination Wellington Fund will contribute close to $9 a passenger, over 10 years.
If the service reaches projections of 90,000 passengers a year, a level at which the frequency of flights would likely have to be increased from four times a week to a daily service, the subsidy could cost around $800,000 a year, every year for a decade.
Although the council had acknowledged that money from the Destination Wellington fund was being used to secure the service, leaked emails show the council is furious that details of the payments were made became public.
Council chief executive Kevin Lavery wrote to councillors on January 22 saying the leak was "disappointing" and had damaged relations with Singapore Airlines.
"Steve Sanderson the [chief executive] of [Wellington Airport] has advised me that Singapore Airlines has expressed serious concerns to him about this breach of confidentiality. This undermines our relationship with Singapore Airlines. It also potentially compromises the interests of our own ratepayers."
Lavery's email set off accusations between councillor Helene Ritchie, who has been publicly critical of the subsidy, and Wellington's deputy mayor Justin Lester, who helped negotiate the deal with Singapore Airlines.
Ritchie, who said councillors were kept in the dark on the spending, claimed Lester had sent a power point presentation to members of the public, suggesting this was how it made its way to the media.
"I was somewhat surprised that Cr Lester sent out the power points to the public and especially given your and his wish as Chair...to retain confidentiality," Ritchie wrote.
Lester responded to Ritchie's accusation claiming that he only shared the presentation - without the financial details - after journalists quoted details of the presentation to him.
"The leaked information was quoted back to me by the Dominion Post and a member of the public as early a two hours after the presentation to Councillors, including commercial information, proposed spend and the general contents of the presentation," Lester wrote.
"As a result, in the capacity of my portfolio I emailed councillors [Simon] Marsh and [Sarah] Free and the residents of Moa Point with the background information EXCLUDING commercial terms, which had been removed by the Chief Executive's office."
A spokesman for the council said it was natural that Singapore Airlines did not want the details in the media.
"Any large commercial entity such as Singapore Airlines does not enjoy having its business arrangements played out in the media while negotiations are still underway," the spokesman said, claiming that negotiatings on the deal were continuing.
"I think the email was sent in response to the fact that Kevin [Lavery] had asked councillors to keep it confidential, at least in the short term but of course that request was clearly ignored by someone so he obviously felt it was necessary to put it on the record about his annoyance."
The council could spend "days, weeks and months" trying to find out who leaked the document, but would not do so.
"We all know that any effective leak, the origin of it will not be detected."
Along with Wellington Airport, the council was attempted to repair the relationship with Singapore Airlines.
"We have explained to Singapore Airlines about the risks involved in trying to keep confidential information confidential."
The spokesman said details of the subsidy "ultimately might have had to be made public" but the Destination Fund allocated funds on a confidential basis for legitimate reasons of commercial sensitivity.
"We were hoping that the same rules would apply here."