Mayor rejects sale of assets

17:00, May 24 2013
John Key and David Parker
BLACK AND WHITE: New Zealand Prime Minister John Key and Christchurch mayor Bob Parker are divided on selling strategic civic assets to pay for the city rebuild.

Politicians may be talking up the benefits of selling Christchurch's family silver for the rebuild but city councillors have already determined it's not going to happen.

Mayor Bob Parker said ongoing suggestions that sales of stakes in strategic assets such as Orion New Zealand, Christchurch International Airport and Lyttelton Port Company might be necessary to pay for anchor projects were "just rubbish".

On Tuesday, Prime Minister John Key said it was up to the council to ask if residents wanted the "nice-to-haves" in the city's rebuild.

Under the Local Government Act, any possible transfer or sale of ownership in council assets has to be explicitly mentioned in the long-term, or in Christchurch's case the three-year, plan.

Parker said that would require special community consultation, "which we would have had to start at the beginning of the Annual Plan process".

"We do not need to sell any assets at this time. It's a choice we don't have to make.


"The whole debate around the anchor projects . . . is winding up into getting hysterical. The reality around the anchor projects is the borrowing we would need is less than $300 million.

"Comments that we have got to sell assets if we want this stuff, it's just rubbish. The whole thing has just built up into a kind of hype.

"The Government has an asset-sale programme - they can go ahead and do that. We have a different view in the city at the moment."

On February 26, councillors passed a resolution - to be added to the final three-year plan - saying there were no such proposals going into the plan.

Cr Glenn Livingstone said he proposed the motion to make it "absolutely clear" the council would not be looking at selling investments to pay for what the Government said Christchurch should have.

"A big question for me is, what right does a central government have to visit upon local government its ideologies? We know the National Government has an agenda to sell off assets."

Former mayor Garry Moore said there was a potential "middle path".

"What is important is we own our own seaport, our airport, our data port and our power company. These are natural monopolies and should be publicly owned.

"But you could say, why does council own a bus company? Bloody good question, we probably shouldn't. Council is probably involved in some things it doesn't need to be involved in.

"We have to apply the same rigour to the proposed projects for the city. In a spirit of good intentions we said we would do this, this and this but maybe, as every family does in the grim face of reality, we might have to relook at things."

With "proper" seating, AMI Stadium in Addington "could do us for 20 years", Moore said.

And he questioned why, when the previous convention centre cost $20m, a "grandiose facility costing 10 times the price" was being considered.

"Actually, Christchurch can't afford that. Do them in a top to bottom priority, so we don't go broke, so we slowly pull ourselves up by our bootstraps."

Parker said the council could sell land and buildings surplus to requirements, although it had not been able to do so because of the earthquakes and their effect on land values.

"There's bits and pieces of land all over the place."

Parker agreed with Moore that some assets could perhaps be periodically re-examined to see if they were still "strategic".

University of Canterbury economics senior lecturer Dr Eric Crampton said the council asset-sales debate seemed "a bit backward".

"It seems every May we have a new round of arguments about council asset sales. But the basic economics haven't changed.

"There is a good argument for council selling off land holdings, there's also a good argument for selling off a minority stake in the airport and perhaps fully divesting Red Bus. But if the money raised winds up supporting the construction of a convention centre or stadium much larger than we really need, it would be a pretty terrible waste."

The Press