Tory Whanau denied last year that the Wellington City Council was in a financial crisis.
Tory Whanau denied last year that the Wellington City Council was in a financial crisis.
Georgina Campbell is a senior journalist based in Wellington who has a particular interest in local government, transport, and seismic issues. She joined the Herald in 2019 after working at Newstalk ZB.
But councillor Ben McNulty has accused Whanau and council officials of “an incredible rewriting of history”.
“At no point until one week before the vote to sell the airport were we made aware that holding the airport would have direct ramifications for other parts of the WCC budget”, McNulty commented on social media.
Council officials have been keen on getting rid of the shares for some time, citing the need to diversify the council’s investments.
Whanau said at that time that the council had all its eggs in one basket.
“Let me be clear - I will never lead a city that sells airport shares to pay down debt. I have never supported selling the silverware to pay the mortgage.
“Instead - to spread our risk and secure our financial resilience - officers have come up with a solution that sells our minority share in Wellington Airport and recycles the funds.”
She successfully proposed that the proceeds of the sale would be put into an investment fund with strong environmental and social criteria and be protected against future councils withdrawing the capital to pay down debt.
Councillor Ben McNulty has accused Whanau and officials of an incredible rewriting of history in the aftermath of the council agreeing to sell its shares. Photo / Mark Mitchell.
There was no threat at that time of $450m in capital spending needing to be slashed if the council did not go through with the sale.
It was also not mentioned in public consultation documents, which said retaining the airport shareholding would have no impact on council rates or levels of service.
This option meant the council would need to retain the $272m of headroom held in its debt-to-revenue ratio. This would limit the council’s ability to fund other projects, the documents said.
We don’t know what has been said to councillors behind closed doors, including if they knew about this budget hole much earlier in the piece.
Regardless, the public didn’t have that specific information when it was consulted on the sale. “Limiting the council’s ability to fund other projects” is not nearly as black and white as cutting $450m from the budget.
To put that money into context- the council’s cycleway network rollout is costing $121m, redeveloping the Courtenay Place section of the Golden Mile is about $54m, the new Tākina exhibition and convention centre was $180m, earthquake strengthening and refurbishing the Town Hall could cost as much as $329m, the city’s new sludge facility is $400m.
In other words, $450 million is substantial, especially in the context of a budget that has already been trimmed to cut costs.
The Wellington City Council has voted to sell its 34 per cent share in the airport. Photo / Mark Mitchell
McNulty and other councillors say this reality was revealed to them only a week before the vote to sell the airport. It seems Whanau did not have a majority firmed up to sell the shares at this point.
That’s because she went on the radio with Newstalk ZB Wellington Mornings host Nick Mills three days before the vote and said a full sale was unlikely and she was leaning towards a partial sale.
A few days later, the council voted in favour of a full sale.
