Wellington Chamber of Commerce a cheer leader for secret corporate welfare

John Milford of the writes:

World of Wearable Arts, Wellington on a Plate, Festival of the Arts, Rugby Sevens… they’re just some of heavyweights of the Wellington events scene that bring in hundreds of thousands of people and tens of millions of dollars.

They help make us the events capital of New Zealand. 

Not only do they each attract people in their own right, but together they encourage other events: the touring shows, the bands, and the one-offs that wouldn’t come here if we didn’t have a record of putting on a good night and selling-out a good show.

It’s hard to imagine Wellington without them. Year after year we enjoy them while acknowledging the huge spend they bring in.

There’s one ingredient they have in common – they all receive, in some form, ratepayer assistance, from either the city growth fund, the events development fund or Positively Wellington Tourism’s budget.

They’re all great things to have. And I’m not opposed to potential ratepayer assistance where there is a clear benefit to Wellington, but that is not enough by itself.

The first question has to be whether these events would occur without ratepayer assistance. Some like WOW could well go elsewhere while the Rugby Sevens probably would not. The Sevens location is more about the ability to get great crowds. Would we really have no Wellington on a Plate without ratepayer assistance?

We need people who will do a hard headed analysis of the business case for each, and the probability they would not occur without ratepayer assistance.

Exact payments aren’t disclosed.

Mostly this is because the council doesn’t want to give away even the slightest commercial advantage by letting competitors know what it’s prepared to pay to secure an event.

Oh sorry but crap. Is there another Sevens event that might negotiate? Plus publishing the amount paid could be great for attracting other events. They could say “Hey you were willing to pay $x for this event, we can do another event for $x-10”

At the end of the day ratepayers deserve to know. When central Government does similar deals, the amounts are published.

Anyway, most of us don’t care what is paid – we don’t ask because we know the benefits far outweigh the likely costs.

This attitude is why my business is not a member of the Chamber. Appalling to have a business leader argue businesses don’t care how much money is paid on their behalf.

Has the Chamber ever surveyed its members and ask them if they support secrecy around the ?

For example, WoW drags in $20 million-plus for  two weeks’ work, while the Sevens once earned a little less than that in just three days.

So how can we judge that when we don’t know the level of subsidy? Also all these economic benefit cases assume the money spent on an activity would not have been spent otherwise. When in reality if you didn’t go to the Sevens, you might have gone out to dinner or a movie and spent money also.

Now when events get people from outside the region, you are creating a benefit for the region, but it is not as simple as calculating the total spent on an event and assuming it is all “benefit”.

So if we’re happy with spending undisclosed amounts on these events, why make a big thing about not disclosing the size of a marketing package to encourage a Singapore Airlines service between us, Canberra and Singapore?

Particularly when all events have the exactly the same aims and all have to meet an acceptable return on investment.

BECAUSE IT IS SECRET AND WE DON’T KNOW THE RETURN ON INVESTMENT

Wellington Regional Economic Development Agency is in no doubt as to the benefits of the air service, saying it “will boost visitor numbers…opens doors for more investment, international student attraction, a faster route to market for local fresh food producers and increased connectivity for business travellers.” 

Actually according to the Council no external advice was sought on the benefits. They just took whatever the Airport said as gospel.

If it is such a good deal, then publish the numbers. Tell us how much is being subsidised, and publish the report calculating the benefits so it can be independently scrutinised.

The chamber is always first to speak up when there’s an issue around transparency of spending ratepayer money.

Really? You seem to a a cheerleader for secrecy at the moment.

We’ve made it our mission to keep a close eye on this, and the council will get no change from us if something smells.

How do you know if it smells when you don’t know the amount being spent, don’t know the estimate of the value, and the Council itself says there is no documentation at all.

And the Singapore Airlines deal, which connects us directly to the world and is worth an estimated $95 million a year, may never have got off the ground.

How do you know it is worth $95 million a year? A lobbyist has told you so. Have you seen any independent verification of this? Has there been a public report that could be scrutinised for its assumptions?

There’s an old saying – if it is too good to be true, then it is. The notion than you can get a $95 million a year benefit for $800,000 falls into that.

Wellington needs a business lobby that is a watchdog, not a cheerleader, for secret Council spending.

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