The plan is to reinvest that money in a new perpetual investment fund.
Over the past decade, the airport has returned nearly $100 million in dividends to Wellingtonians and had a better-than-average return than the sharemarket of 11.2 per cent annually, Tolich argued.
“It makes no sense to sell such a profitable asset.”
“History shows that whenever assets are privatised they are lost forever, and no matter what safeguards we are promised the funds are frittered away on pet projects or dipped into the moment things get tough.”
Wellington City Council has acknowledged the important revenue stream.
However, the council has concerns the shares and ground leases are effectively the only two investments in its portfolio.
“It is not well diversified and is highly exposed to situations like the Covid-19 pandemic. The investment portfolio could not be easily utilised in a disaster, such as a significant seismic event,” council documents said.
Mayor Tory Whanau has said 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.”
Any investment fund would have strong environmental and social criteria and be protected against future councils withdrawing the capital to pay down debt, Whanau said.
This persuaded several councillors, who were initially reluctant, to support putting the sale proposal out for consultation as part of the Long Term Plan.
Georgina Campbell is a Wellington-based reporter who has a particular interest in local government, transport, and seismic issues. She joined the Herald in 2019 after working as a broadcast journalist.
