Parker rejects sale of assets

SAM SACHDEVA
Last updated 05:00 22/05/2012

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The Government has been told to back off pressuring Christchurch into selling its ratepayer-owned assets.

Mayor Bob Parker was yesterday defiant in response to growing calls for the city council to cut its stake in council-controlled companies.

Prime Minister John Key and Local Government Minister David Carter have said the council should contemplate selling shares in its assets to fund the city rebuild.

Key has said the council "might want to consider the balance" of its assets, and Carter has called on the council to think carefully about "rationalising" assets.

Parker told The Press the council had proved that it could fund its share of the city's recovery without resorting to asset sales.

"Despite being told by the Government a year ago that we would need to put our assets on the blocks just to meet our share of the infrastructure and the major assets rebuild, we have proven them totally wrong."

The council-owned companies were "tremendous investments" that had been well managed and generated significant revenue for ratepayers, he said.

The council regularly reviewed its assets holdings, but Parker believed no changes were necessary.

He was not concerned about the Government's overtures and believed a lack of understanding was responsible for the statements.

"The Government's got a million things on its plate, and I don't expect all ministers to be intimately associated with the financial positions of the city," he said.

"If they stepped back for a moment and just had a look at the situation, they would see a community which has invested wisely over a number of decades and owns a number of strategic assets."

The council would have the final say on what it did with its assets, Parker said.

"I don't think it's the Government's place to tell us what we should and shouldn't own as a community," he said.

"If we need to resolve or solve some sort of pressing financial issue, that's something we will do, but we don't need the Government to tell us how to do it and when we should do it."

Carter said he acknowledged the council's responsibility for its own assets, but it had a duty to consider other options to fund the recovery.

Whether asset sales were necessary could depend on whether concerns over the council's insurance cover turned out to be true, he said.

"If they are well insured, they may make a decision that they don't need to sell down their assets, but if they're well and truly underinsured, I expect that would come back on the agenda," Carter said

Key said the council should be able to have a "grown-up" conversation about its assets ownership.

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"We're simply saying, `We're all grown-ups; let's have a discussion about the mixture of assets we own'," he said.

"Mum and dad do that in their home every single day. They think about the mixture of assets they've got, they think about whether they might want to buy something else or sell something."

The Government had committed $5.5 billion to the city's recovery, Key said.

Funding from other sources might be needed to fast-track the rebuild.

Labour local government spokesman Clayton Cosgrove said the Government was clearly pressuring the council to sell its assets.

Revenue from asset sales would be a "short-term fix" that would not make up for the loss of the companies' annual dividends, and there was "wall-to-wall opposition" to asset sales, Cosgrove said.

- The Press

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