Auckland Mayor Wayne Brown to push on with selling Auckland Airport shares after consultation showed ‘majority support’

Auckland Mayor Wayne Brown wants to sell the council's shares in Auckland International Airport to bridge a $295m funding gap. Photo / Dean Purcell

Auckland Mayor Wayne Brown intends to push on with selling Auckland Council’s shares in Auckland International Airport after public consultation showed most support the controversial move.

And he is urging councillors to keep an open mind about the options available to bridge a $295 million funding gap, as they meet today to assess the results of public consultation on the council’s annual budget.

The council has proposed a programme of spending cuts, increased rates, asset sales and debt to bridge the massive shortfall.

It has sparked concerns that funding for beloved arts and cultural programmes across the city could be axed, affecting the fabric and identity of Auckland.

Brown told Newstalk ZB’s Mike Hosking that the “public has woken up” to the fact that the council could not keep borrowing money.

“People seem to understand that we’ve inherited a bit of a mess and that the mixture of things we have offered does show a way by giving a little bit of a haircut here and there, rather than relying on one,” said Brown.

Public consultation on the proposed package of cuts and borrowing attracted record numbers of submitters, with 41,146 submissions received and nearly 4000 others providing feedback through a demographically representative survey.

The council has today released a report summarising public feedback.

It has found there is majority support to sell Auckland International Airport shares but that people are split on whether it should be all or some of the shares.

Other key findings include:

• Most participants believe there needs to be spending cuts but opinion differs on the extent of the cuts - most prefer some, rather than all, of the possible spending cuts.

• The proposed mix of rates and debt - rates increase of 4.66 per cent and borrowing of up to $75m - was the most popular of the options canvassed.

• There was also public support for the Future Storms proposal, which would put an additional $20m each year towards preparing for and responding to severe weather.

The council proposes spending $20m each year to prepare for and respond to severe weather. Photo / Brett Phibbs

Brown said it was encouraging there appeared to be public support for key elements of the budget proposal, including using a balance of spending cuts, sale of airport shares, rates and debt to cover the $295m hole.

“We encouraged Aucklanders to have their say on the key proposals for the annual budget and they did, in record numbers – the most of any individual public consultation in Auckland Council’s history.

“We will listen to what Aucklanders have told us, and balance that with the correct mix of different levers for this budget. By putting a number of options on the table, my budget proposal provided us with the flexibility to genuinely take into account public input.”

He urged people “to be constructive, and to keep an open mind” about the options to bridge the financial gap.

Wayne Brown wants to sell Auckland Airport shares to help plug budget gaps.

“Remember, bigger bills are heading our way. The combined cost of Auckland’s flood recovery and over-runs from the City Rail Link are somewhere in the region of $1.7b.

“Events like these provide a timely reminder that we need sufficient debt headroom to deal with unforeseen shocks. We cannot in good conscience rely on increased borrowing to cover annual budget shortfalls each year. Now, more than ever, we have to be prudent and make financially sustainable choices.”

Last week, the Governing Body began a series of 14 workshops on the annual budget, which involve briefings for the mayor and councillors, and cover regional feedback and input from local boards, economic and financial forecasts, a budget refresh, analysis of the impacts for all Aucklanders, and the mayoral budget proposal.

“There are still difficult choices to be made that require some compromise. I am quite prepared to negotiate on aspects of my proposal, but there has to be some alternatives on the table,” Brown said.

“At this stage, I believe we should go ahead and sell the airport shares, because it makes good financial sense, and allows room to move on some of the more disliked cuts to social, arts and culture services. At least 27,000 ratepayers pay rates solely for the council to retain our shares in a company listed on the NZX.

“It’s important that our budget choices are credible, sustainable and avoid unreasonable shocks for Aucklanders now and in the future.”

Auckland Council’s Governing Body, made up of the mayor and 20 ward councillors, focuses on Auckland-wide strategic decisions and is responsible for preparing and adopting the annual budget. The first step in developing the annual budget was the draft mayoral proposal, passed for consultation 20-1 by the Governing Body in December.

The decision-making process will culminate with the final mayoral proposal on May 31, with all budget decisions made on June 8, and adopted on June 29.