A good u-turn by Christchurch Council

September 30th, 2015 at 2:00 pm by David Farrar

Stuff reports:

Beachside Christchurch residents are celebrating “democracy at its best” after a plan to deal with long-term flooding and erosion risk was dropped.

In a press conference on Tuesday, Environment Minister Nick Smith and Christchurch mayor Lianne Dalziel announced that plan changes affecting property owners as a consequence of future coastal hazards would be dealt with through normal planning processes and not through the fast-tracked District Plan review process.

The Christchurch City Council sparked anger and anxiety among coastal property owners in July when an assessment it commissioned of the long-term threat posed by sea level rise identified 6000 properties that could be susceptible to erosion and nearly 18,000 that could face coastal inundation over the next 50 to 100 years.

The council immediately amended Land Information Memorandums for those properties to indicate they were in a coastal hazard zone and announced it was proposing through the Replacement Christchurch District Plan (RCDP) to limit new development in the areas considered most at risk. 

That sparked concern people would not be able to develop their properties, values in coastal areas would dive and it would become harder and more costly to get insurance.

Christchurch Coastal Residents United spokesman Tim Sintes said the decision to step back was “fantastic news”.

“To get a result like this, it’s democracy at it’s best.

“It has to go this way, with a national standard, rather than ticking off one town after another.”

The issue of sea level rise is a complex one, and not one Councils should be doing in isolation, and rushing through.

Smith said Christchurch had enough on its plate and did not need to have the added burden of leading the country and the world on how to deal with the issue of climate change and sea level rise.

The Government was proposing both legislative changes and national policy guidance on such hazards as part of its Resource Management Act reform programme.

“More time will also allow contestable advice and normal appeal rights to the Environment Court. It makes sense for the timing of this work to be aligned with national policy. I am satisfied that the existing plans provide adequate interim measures to deal with these risks in the immediate future,” Smith said. 

We have robust data showing there has been sea level increases in NZ. From 1900 to 2000 the sea level in Auckland increased 16 cm, or 1.6 mm a year. While this rate has been increasing globally, in Auckland it does not yet appear to be accelerating. It will to some degree, but we don’t know to what degree. And hence rushing through LIM notations on properties when the data is not yet clear, is unwise.

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60 fewer managers for Christchurch City Council?

August 29th, 2015 at 2:00 pm by David Farrar

Stuff reports:

Christchurch city council staff are “upset” and “shocked” by news they stand to lose their jobs, their union says. 

Sixty jobs will go under a major Christchurch City Council restructure announced on Thursday.

Chief executive Karleen Edwards said the changes would start with those “at the top”.

Nearly half of the axed roles are management positions. Edwards said the intention was to improve customer service, not to save money.  

The changes mean:

– 175 roles will be disestablished and 115 new roles created.

– Executive leadership team positions would drop from seven to five.

– 79 of the disestablished roles are management positions, 15 are communications roles and 12 are marketing roles. 

So of the jobs going half are managers and a sixth are comms or marketing. Looks like a good restructure.


Red zone rebels costing ratepayers $42,000 each

August 26th, 2015 at 4:00 pm by David Farrar

Stuff reports:

Christchurch red zone stayers say they have no intention of moving despite city council plans that may cut back key services such as roading, water and wastewater.

A Christchurch City Council staff report recommends decommissioning infrastructure no longer needed and reviewing services to residents still living in the Brooklands and Avon red zones to save money.

The report, which will go to councillors on Thursday, says maintaining red zone infrastructure costs about $260,000 a month and last year cost $3.1 million.

About 74 red zone houses are still occupied by people who did not accept the Crown’s buyout offer after the earthquakes, the council estimates.

So each red zone rebel is soaking up $42,000 from other ratepayers. A very easy decision.

Jan Burney, one of about 25 people who have decided to stay in Brooklands, said she had no plans to leave.

That’s fine – just don’t expect subsidies from others.


The Press ranks the Christchurch Councillors

August 3rd, 2015 at 9:00 am by David Farrar

The Press has awarded stars to the Christchurch City Councillors. Their ratings are:


  • Lianne Dalziel
  • Vicki Buck
  • Raf Manji


  • Phil Clearwater
  • Yani Johanson
  • Glenn Livingstone
  • Andrew Turner


  • Jamie Gough
  • Tim Scandrett
  • Ali Jones

No star

  • David East
  • Jimmy Chen
  • Pauline Cotter
  • Paul Lonsdale

What do locals think of these ratings? Almost everyone I know says Raf Manji is a star.

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$1.2 million for a basic Council website is too much

July 31st, 2015 at 11:00 am by David Farrar

Stuff reports:

The Christchurch City Council has spent $1.2 million upgrading its “outdated” website.

The revamp included new software, new content and staff training and took three and a half months. The site was last overhauled in 2009 and that version ran on systems that would not be supported past this month.

The $1.2m spend came out of the council’s IT capital budget for this financial year.

The director of a Christchurch web development company said the total cost was a surprise.

“That takes my breath away. You vaguely hear of those sorts of number getting thrown around. I’m struggling to get my head around where that cost would come from.”

The director, who asked to remain anonymous as his company did web development work for the council, said parts of the design, such as the user elements for rates and dog registration, were quite technical, making precise cost estimates difficult.

“[But] we’d have happily done the job for half that and probably, I believe, still arrived at the same result.”

$1.2 million is a huge figure. If they had designed a website where you could interact online with the Council in every area, that sort of price might be justified, but it is primarily just a static website.

As an example I went to their services section to see what could I do online. Under burials, there is no online form to book one in. You download a pdf, print it out, then have to scan it back in and e-mail it to them.

Other services which you can’t do online are:

  • Dog registration
  • Tenancy application
  • Report to noise control

Incredible that they spend $1.2 million and can’t even convert some pdf forms into online forms.


One more Councillor or three more Councillors – not a true choice

July 21st, 2015 at 12:00 pm by David Farrar

Stuff reports:

Up to three additional Christchurch City councillors could be elected at next year’s local body elections as part of a post-quake representation shake-up.

After studying population shifts since the 2010 and 2011 quakes, council staff are putting forward two options for re-jigging the city’s representation arrangements. …

Under the first option, Christchurch and Banks Peninsula will be carved into 14 wards. Under the second option, they will be divided into 16 wards.

Each ward will be represented by one councillor to deliver either a council of 14 or 16, plus the mayor.

The current Council has 13 Councillors (plus the Mayor). So both options are to increase the number of Councillors. That’s a claytons decision. How about an option for the status quo or reducing the number?

A governance body larger than 12 members tends to struggle to do its job well, and you inevitably get an inner circle of key decison makers the bigger you get. The current total size of 14 is large enough – no need to go to 15 or 17.

I do support though the proposal to have one councillor per ward. I think you get far better informed voting in smaller wards with just one councillor to be selected, than a larger ward where you have to pick multiple councillors.



Lianne doing well

June 7th, 2015 at 10:00 am by David Farrar

The Press reports:

Three months ago, it seemed unlikely Christchurch City councillors would find common ground and reach agreement on how to dig the city out of its financial hole.

But some deft manoeuvring by Mayor Lianne Dalziel has the council inching closer to unity. 

The budget proposal she outlined on Friday was both clever and pragmatic. It did not shy away from an unprecedented sell-down of council-owned assets but it spread the timing out over three years, which gives the council more wriggle room and time to finalise exactly how much money it needs to finance the work it has to do. …

A $200 million-$300m reduction in the council’s capital works programme coupled with $40m in projected savings from the council’s operational budgets has also allowed Dalziel to propose a lower rate rise than originally forecast. Rates in Christchurch will still rise significantly over the next few years but the burden will be a little less onerous than originally thought.

There is a trade-off though. Having lower rate rises means we might have to wait longer for some capital projects, including road repairs. Just what projects will get pushed out or axed altogether is unclear. Some initial cuts have already been made but the bulk of the re-prioritising work will occur in the second half of this year when external advisors will be brought in to help the council separate the capital programme’s nice-to-haves from the must-haves.

A lot of work still has to be done but Dalziel deserves credit for putting forward a proposal that charts a clear course to a sustainable financial future.

Dalziel has shown commendable pragmatism in seeing the wisdom in using existing assets to help with the purchase of future assets. I wasn’t sure she could leave ideology behind, but she has.

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Yardley on Chch community boards

May 29th, 2015 at 11:00 am by David Farrar

Mike Yardley writes in The Press:

It will come as little surprise to learn the bulk of city councillors who voted in favour of super-sizing the number of elected representatives were indeed the People’s Choice crew, who increasingly vote like a blinkered, partisan block.

Ironically, these civic comrades, who want to rack up a bigger bill on running the council, are the same characters who’ve been particularly vociferous against capital divestment of council assets.

Any credible consideration of getting the council’s financial house in order has completely escaped their priorities.


Dove-tailing with the representation review, the city council is planning to develop a community governance model, whereby many council decision-making powers are devolved to community boards.

The notion sounds fine in theory but do our community boards currently comprise the requisite calibre and nous, to make the hard calls and reach firm decisions, frugally and fairly?

With the council’s Long Term Plan hearings under way, I subjected myself to several days of the process on the live-stream last week.

It was a dispiriting spectacle. One by one, the community board chairs fronted up to the council table, cap in hand, to make their submissions and share their big-spending wish lists – seemingly oblivious to the city’s dire financial predicament.

Most of the board chairs dutifully barked their protestations at council asset sales, like graduating parrots from group-think school.


The Lyttelton-Mt Herbert Board chairwoman, Paula Smith, even had the gall to claim her community supported lifting the annual rates rise beyond 8.75 per cent.

I hope she campaigns on that.

Spreydon-Heathcote chairman Paul McMahon tried to argue that instead of divesting capital, the convention centre should be aborted.

McMahon didn’t seem  to realise the project is being fully funded by the Crown, prompting the mayor to bristle with frustration.

Then the deputy board chair, Karolin Potter, launched a tirade against any council money being lavished on car parking in the central city, because “we should only use public transport to get to the city”.

Adding to the cabaret, Riccarton-Wigram’s Mike Mora called for a spanking regional fuel tax to avert asset sales, until the ever-exasperated mayor, who couldn’t stomach the malarkey any longer, shut him down with quick-fire lecture on how the council was powerless to impose such funding-stream fantasies.

If you were hoping your community board representatives might actually defend your back pocket, and submit savings proposals, to slash the forecast rates hike of 8.75 per cent this year, it was an epic failure.

Might be time to set up a Christchurch Ratepayers’Alliance.

In basically just two weeks, the Auckland Ratepayers’ Alliance has gained 6,000 members, as the backlash grows against the 9.9% residential rates increases. That means the ARA now has more members in Auckland than all but one political party. Even better a significant proportion of the members have said they want to be volunteers and activists. I’d be very worried if I was a Councillor who voted for 9.9% rate increases in Auckland or advocated for the same level of increase in Christchurch.

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The Press against increasing the size of Council

May 19th, 2015 at 1:30 pm by David Farrar

The Press editorial:

The suggestion that Christchurch residents support  more councillors is rather surprising.  There has been no hint of it in public debate recently. The last time the number of councillors was reviewed six years ago there was no hint of dissatisfaction with the council’s size and that review passed virtually unnoticed. …

There is no doubt that the governance decisions councillors must make in the rebuild are of fundamental importance and require close attention. But councillors are well paid for their work and it is far from clear that increasing the numbers will improve the decision making. Indeed, studies on board governance suggest that the council is somewhere near an optimum level for efficiency and performance. To take an obvious if not quite exact parallel, the boards of giant companies making billion-dollar decisions are rarely much larger.

 Any suggestion of a council increase will have to go to public consultation. Ratepayers are unlikely to support it. What they want is sound and efficient decision-making, not a handful more decision-makers.

The Council struggles to make sound decisions with 13 Councillors. Going to 19 will only make the problem worse.

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Unions can’t get past ideology

May 17th, 2015 at 2:00 pm by David Farrar

The Press reports:

Unions are pushing for the Christchurch City Council to renegotiate its Cost Share Agreement with the Crown in a last ditch bid to stop assets being sold off.

They’re saying they want hard working taxpayers in Oamaru and Hamilton to hand over money to the Christchurch Council. Taxpayers have been very generous with Christchurch, and have poured billions in. But an agreement is an agreement. The Christchurch Council has to live within its means.

The Rail and Maritime Transport Union told the council it was vehemently opposed to the proposed asset sales and viewed it as matter of life and death.

“In our experience the privatisation of publicly owned assets that are operated as businesses leads to a deterioration of health and safety standards and increased risk of serious harm and death. This was our experience during the privatisation of the rail industry in New Zealand,” spokesman John Kerr said.

Lyttelton Port had an unhappy recent history of deaths and serious harm injuries on the waterfront and its inland port. The union did not wish the situation to be made worse by a sell-off of the port and would fight to stop any sale.

Their ideology blinds them. Council owned ports such as Lyttelton have far far worse safety records than privately owned ports such as Tauranga.

Relative injury rate statistics at all the Ports throughout New Zealand. Supplied by Worksafe New Zealand BTG 31Oct14 -

Relative injury rate statistics at all the Ports throughout New Zealand.
Supplied by Worksafe New Zealand
BTG 31Oct14 –

This graph is from the Bay of Plenty Times. The most unsafe ports are Timaru, Wellington, Dunedin and Lyttelton. Wellington’s port is 100% Council owned. Port Otago is 100% Council owned.

The Port with the largest private shareholding (45%) is Tauranga. Bluff has 34% private.  Timaru has 28% private.

There is no evidence at all that having some private share-holding makes you unsafe.

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Yardley backs Jones

May 17th, 2015 at 10:00 am by David Farrar

Mike Yardley writes:

Enter the Christchurch deputy mayor, Vicki Buck, who thinks it’s the city council’s role to fire hose the issue with your money, by underwriting their rental payments on more than 40 private properties.

Enter Cr Ali Jones, who had the audacity to say no. No, to the never-ending binge. No, to the misappropriation of the city’s coffers as a branch office of social welfare.

No, to Vicki Buck’s insatiable appetite to dream up new feel-good, big-spending schemes, that stray further from the council’s knitting and inflate the rates explosion.

As Cr Jones points out, only eight weeks ago, the council benevolently shelled out $300,000 to the City Mission for their new Homelessness Accommodation Project.

But now Cr Buck wants to throw another $400,000 at the problem, even though Cr Jamie Gough has confirmed to me the council housing unit  (which is supposed to be revenue neutral) “can’t clean its own face”, clocking up a monthly loss of $660,000.

Fundamentally, the council’s penchant for trying to usurp the core functions of the Ministry of Social Development is galloping out of control.

Housing is not a core role for Councils. Central Government does have a role there, but local government should focus on doing infrastructure well, rather than trying to be a social welfare provider.

Christchurch is blessed with an abundance of community housing providers. As just one example, Comcare and VisionWest have just been contracted by the government to provide more placements for transient residents.

Meanwhile, the inspirational Sue Bagshaw is developing transitional housing for homeless youth. 16 and 17 year olds are currently paid $175 a week by Work & Income, plus a $65 accommodation supplement.

If they pooled their money wisely, and behaved lawfully, securing a rental wouldn’t be problematic.

But unreformed glue sniffers, pot and meth heads, unwilling to deal to their demons, is a hell of a proposition for private landlords.

I’ve held the hands of several friends as they confronted drug addiction. I know how tortuous the journey can be. But it’s the extended whanau who need to be fronting up, taking account and reclaiming their “lost” children from the street.

The hate-filled, rancid, vitriol piled on a councillor who courageously said no to yet another hand-out, is contemptible.

It is always interesting to observe how much hatred some people have when a politician has different views to them. It isn’t healthy.

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Christchurch Councillors claim they need more Councillors

May 12th, 2015 at 12:00 pm by David Farrar

Stuff reports:

The size of Christchurch City Council could be increased by more than a third because of concerns councillors are spread too thinly across the city.

The elected arm of the council consists of the mayor and 13 councillors but a working party set up to review representation arrangements in Christchurch is concerned that is not enough for the size of the city’s population.

Based on the current size, there is only one councillor for every 26,000 people in Christchurch, which is far below the ratio in other metropolitan cities where there is, on average, one councillor for every 16,500 people.

Other cities (except Auckland) have smaller population and inevitably a higher ratio. Look at the data:

Christchurch – 13 councillors (one per 26,000 residents)

Hamilton – 12 councillors (one per 12,512 residents)

Wellington City – 14 councillors (one per 14,102 residents)

Dunedin – 14 councillors (one per 8823 residents)

Nelson – 12 councillors (one per 4058 residents)

Auckland – 20 councillors (one per 74,645 residents)

What I read from this is that all major cities except Auckland have 12 to 14 Councillors. So Christchurch is not unusual.

With each councillor entitled to a salary of close to $100,000, increasing the size of the council to 19 will add at least $600,000 to the cash-strapped council’s operating costs.

But worse than that, a large Council becomes a worse decision maker. There is a wealth of literature on optimal sizes for councils and boards to function well. It tends to be between five and nine. As Councils do have a need to be representative, they are often a bit larger at 10 to 12. But you never really want to go beyond 12.

If there is extra workload from the earthquakes, then a better solution than more Councillors would be more resources for Councillors.



Not very common sense

April 21st, 2015 at 10:00 am by David Farrar

Stuff reports:

An alternate budget that slashes the Christchurch City Council’s work programme and avoids the need for strategic asset sales is being touted as the answer to the city’s financial woes.

The Common Sense Plan for Christchurch was released at the weekend by the six Labour-aligned People’s Choice councillors and is aimed at circumventing the need for the council to sell shares in Lyttelton Port, Christchurch International Airport Ltd, Orion and Enable.

Its release comes less than 10 days out from the closure of public submissions on the Christchurch City Council’s draft Long Term Plan (LTP) which includes provision to sell up to $750 million in assets in order to plug the council’s $1.2 billion funding shortfall.

The People’s Choice councillors – Andrew Turner, Phil Clearwater, Yani Johanson, Glenn Livingstone, Pauline Cotter and Jimmy Chen – voted against including asset sales in the draft LTP and have been desperate to find another way to balance the books. 

They propose cutting $700 million, or 15 per cent, from the council’s $4.6 billion 10-year capital works programme outlined in the draft Long Term Plan (LTP) by deferring all non-urgent work, including construction of the city’s planned new rugby stadium.

They also propose asking the Government to use the $37m it has allocated for the new stadium on road repairs and propose asking for another $180m in Government funding for the horizontal infrastructure repair programme.

I’m all for cutting spending. That part of the proposal is good.

However their balanced budget is dependent on waving a magical wand and the Government handing over $217 million. That’s not common sense. That is wishful thinking. The Government has a signed and sealed agreement with the CCC as to how much it will contribute.

Alternative budgets are a good thing if they genuinely propose alternatives such as deferred spending, or different revenue streams – so long as they are revenue streams that the Council can actually use.

This is not an alternative budget. It is a plea for a Government bailout.


Ashes in Christchurch

March 30th, 2015 at 3:00 pm by David Farrar

The Press reports:

A cultural clash over scattering of human ashes has left Christchurch City Council split and a new bylaw in limbo.

Despite months of deliberations, councillors still cannot agree whether the Draft 2014 Parks and Reserves Bylaw should include a provision allowing human ashes to be interred or scattered in parks and reserves.

Local Maori are against the practice for cultural reasons, but a council hearings panel decided it was unwilling to impose any blanket restrictions on the scattering of human ashes without first doing wider public consultation.

The panel brought a report to Thursday’s council meeting that recommended the council pass the bylaw with the omission of the clauses relating to the scattering of ashes.

That would mean the status quo would continue to apply and people would be able to scatter or bury ashes in any public place, apart from the Botanic Gardens, until the council had time to consider the matter further.

Good. So long as it is done in a way that doesn’t interfere with other users of parks (ie don’t sprinkle ashes in the middle of someone’s picnic), people should be at liberty to let cremated loved ones be scattered in a park.

Mahaanui Kurataiao (MKT), the company that acts on behalf of six runanga within Christchurch, had formally submitted the council should ban the scattering of ashes in parks and reserves.

In subsequent talks with the council, it acknowledged it was not practicable but said, as a minimum, the practice should be restricted to identified locations within council-controlled parks and reserves and people encouraged to bury ashes rather than scatter them to the wind.

If members of the six runanga don’t wish to scatter ashes, then they shouldn’t. But their religious beliefs should not be imposed on others.

Andrew Turner and the other People’s Choice councillors said they were unprepared to allow the status quo to continue when MKT had raised such significant cultural concerns about human ashes being scattered in parks.

“I’m not happy for this bylaw to be approved with this significant matter still unresolved,” Turner said.

“To approve the bylaw and then signal we are looking to change it quite soon … is quite absurd.”

As the hearings panel had already been instructed once to go back and reconsider the bylaw as it related to the scattering of ashes, there was no point asking it to revisit the matter again, Turner said.

The best option was to refer it to the full council for a decision.

The Council should follow the advice of the panel, and not impose the religious beliefs of some residents on all residents. The harm it causes to those who can’t farewell their loved ones in they way they wish is much greater than any perceived harm by those who disagree with the practice.

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Guest Post: Christchurch Planners

March 14th, 2015 at 2:00 pm by David Farrar

A guest post by Hugh Pavletich:


 Hugh Pavletich
Performance Urban Planning
New Zealand

 4 March 2015

 Introduction …

 On Thursday 26 February, an important decision was announced by the Christchurch Replacement District Plan Independent Hearings Panel, dealing with the Christchurch City Councils Notified Plan foundation Strategic Directions and Outcomes ( http://www.chchplan.ihp.govt.nz/Hearings/Hearing1/Pages/default.aspx ).

 Recently, the Press Senior Feature Writer John McCrone interviewed Sir John Hansen, a former High Court Judge and current Chair of the Christchurch Hearing Panel … Sir John Hansen is a man with a plan . Sir John and the Panel are highly regarded within the wider community.

 Housing …

 With respect to housing (s164 onwards) the Panel states the Council’s Notified Plan was “insufficiently clear and directive on the very important subject of housing capacity and choice”.

As noted within the decision, submitters explained the human costs of Christchurch’s stressed and currently severely unaffordable housing market.

S167 states …

‘In the overall sense, that demonstrated relevant provisions of the Notified Version would fail to promote sustainable management. In particular, its Policy referred vaguely and inconsistently to notions of “housing affordability” and “opportunities for affordable housing development … sufficient to meet demand’. Without proper definition or objective or goal” the Notified Version did not provide any helpful measure of the problem or ability to monitor whether the problem was being resolved (through the administration of related Plan provisions, for example).”

The Panel Decision stressed the importance of consistency, clarity and certainty.

In subsequent sections the Decision states the Planning Experts Joint Version “… was much clearer”.

The Planning Experts perspective, however, tends to be prescriptive.


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Labour breaking their word on asset sales

December 8th, 2014 at 9:00 am by David Farrar

Asset sales are a controversial and often emotional issue. That is why National has been very careful to lay out its policy in advance, and keep to it.

In 2008 National said no SOEs would be sold in the first term, and none were.

In 2011 National said up to 49% of four power SOEs and Air NZ would be sold, and they were (except Solid Energy that collapsed).

In 2014 National said no further sales of SOEs and there are none planned.

Now contrast this to Labour in Christchurch. The Press reports:

It took months of briefings, quiet lobbying, and frank meetings to bring the Left-leaning People’s Choice councillors around to the inescapable truth that some asset sales would be needed to solve the city’s financial woes.

Those meetings happened  right up until late Thursday afternoon, which suggests some councillors were still wavering.

The reason the People’s Choice councillors – Andrew Turner, Jimmy Chen, Pauline Cotter, Yani Johanson, Phil Clearwater, and Glenn Livingstone– were  reluctant to go down the path of asset sales was because they had signed a pledge before last October’s elections to support keeping all significant public assets in public ownership and control.

They didn’t want to be seen to be going back on their word.

They were confident that if they pored over the council’s budgets, cutting expenditure and deferring capital projects, they could achieve the necessary savings without asset sales. 

Alas, it was not to be and on Thursday the People’s Choice councillors reluctantly threw in the towel and acknowledged the funding gap, which has jumped from $900 million to $1.2 billion, was too large to close through savings.

“Our preferred option is not to sell assets, however, the financial position in which the council has been placed requires us to sell assets as one of the number of things we need to do to fill the funding gap,” they conceded in a statement issued through Turner, their spokesman.

This is not true. There is a choice. They have chosen to break their word. I think their policy was stupid and wrong, but they made it.

The People’s Choice is the Labour Party in Christchurch local government politics. In fact most of the PC Councillors had their affiliation on their ballot as (The People’s Choice – Labour).

So the moral of the story is that National has kept its word on asset sales, and Labour once again has not.

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Will Christchurch sell assets?

December 1st, 2014 at 11:00 am by David Farrar

The Press reports:

The path to asset sales is likely to be cleared this week as the Christchurch City Council takes steps to raise money for the rebuild.

Councillors are expected to hold a special meeting on Friday to adopt a financial strategy that deals with the potential $900 million funding shortfall the council is facing over the next few years.

Details of the strategy have yet to be made public but Mayor Lianne Dalziel said it would include a range of options to release capital from city-owned assets.

That could sit uneasily with the seven People’s Choice councillors, who all signed a pre-election pledge that promised all significant public assets would be kept in public ownership and control.

Dalziel had studied the pledge and believed councillors would not be breaking their word if they went down the route proposed.

She reasoned that if the council was to sell some of its Orion shares to the neighbouring Selwyn District Council (SDC), which already had an 11 per cent stake in the company, that pledge would still have been honoured.

Likewise, she saw no problem with inviting a strategic partner to buy a stake in Christchurch Airport or Lyttelton Port (LPC), provided the council retained its control.

You mean a mixed ownership model? Have the Council keep say 51%? Use the proceeds to reduce the need to borrow for other assets?

It sounds a very sensible idea. Of course it is the same idea National had in 2011, which Lianne campaigned against. If the Christchurch Council does agree to this policy, I expect Labour to of course condemn them and campaign against their decision!

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Christchurch Council considers partial privatisations

August 5th, 2014 at 2:00 pm by David Farrar

The Press reports:

Ngai Tahu is expected to be one of the partners invited to take a stake in the cash-strapped Christchurch City Council’s commercial and investment arm.

The council is considering releasing up to $400 million in capital from Christchurch City Holdings Ltd (CCHL) as part of a plan to reduce its funding shortfall, which has been calculated by investment bankers Cameron Partners to reach up to $883m by 2019.

CCHL owns 75 per cent of Christchurch International Airport and is also the majority shareholder in the Lyttelton Port Company and Orion.

It also owns City Care, Enable and Red Bus Ltd.

The irony is huge. Lianne Dalziel as a Labour MP campaigned against partial privatisations, yet as Christchurch Mayor she may implement the same policy at the Christchurch City Council.

It is the obvious thing to do. When you have huge debt, then a reduction in assets to offset debt is preferable to rate increases of 20%+.

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Christchurch City Council incompetence continues

July 12th, 2014 at 11:00 am by David Farrar

Stuff reports:

The Christchurch City Council is unlikely to face consequences after a food-licensing blunder affected businesses, Local Government Minister Paula Bennett says.

All cafes, supermarkets and food manufacturers in Christchurch were left operating illegally for two weeks after food licences expired on June 30 and none were renewed by the council.

Bennett said the council would not face intervention as a result of the delay but would be under the spotlight and monitored for further botchups.

Delays in renewal were timing and administration, which the council said it had now fixed.

“The council has some unique challenges to manage on top of its core business requirements,” Bennett said.

“While I don’t believe this delay indicates the council has wider issues or that there is a need for intervention, I’ve asked officials to continue monitoring the council’s work to ensure all is on track.”

Hospitality NZ Canterbury president Peter Morrison said the blunder was “unbelievable”.

“It’s diabolical, considering all the trouble they’ve had with the building consents, that they couldn’t get a simple thing like this right,” he said.

Now consider Labour is vowing to abolish CERA in 2016 and make their mate Lianne’s council responsible for the entire rebuild.

Considering the Council lost its consenting accreditation due to incompetence, and now has failed to perform another statutory duty, can you imagine the chaos that would eventuate if they were in charge of everything.


Is the Christchurch Town Hall affordable?

July 10th, 2014 at 9:00 am by David Farrar

The Press editorial:

The Christchurch City Council’s decision to pause its project to restore the Christchurch Town Hall until its financial position is clearer is plainly a wise one. The council had intended to begin seeking expressions of interest from companies who wanted to be involved in the project in May. But that has not gone ahead while the council awaits the outcome of negotiations with is insurers. That makes sense. There would be little point in committing a lot of time and money to the project if in the end there would be no rational way for the council to complete it.

The Council is already struggling with debt.

The Town Hall was insured for $69.1 million, but not all of that is necessarily recoverable. In any case, repairs have been estimated to cost $127.5m, more than it cost, in inflation-adjusted terms, to build.

So the net cost to ratepayers is at least $58 million.But it sounds like they won’t get the full insurance and we all know government construction projects tend to cost more than originally estimated. I would not be surprised if ratepayers end up having to pay over $100 million. That is almost $800 per household. If you asked households if they would rather have the $800 themselves or spend it on the Town Hall, I know what the answer would be.


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Can Christchurch Council make hard decisions?

May 8th, 2014 at 9:00 am by David Farrar

Stuff reports:

The Christchurch City Council is facing a cost over-run of $534 million which could balloon even higher if it fails to secure $1 billion in insurance payouts.

The grim financial picture was revealed this afternoon as the council finally released the findings of an independent audit of its finances conducted by KordaMentha, an advisory firm specialising in insolvencies and corporate recovery. …

The report has been labelled a worst case scenario by others in this story. What it is really about is trying to get more money out of taxpayers, rather than ratepayers:

Green MP Eugenie Sage said it was time the council and the Crown renegotiated their earthquake rebuild cost-sharing agreement.

“It’s clear that the Christchurch City Council is not in the financial position to pay all of its share for the big-ticket items being pursued by the Government, or to borrow more,” said Sage.

Labour MP Ruth Dyson said the Government had to acknowledge the city’s financial position had changed.

“We need a genuine partnership between central and local government if our recovery is going to be the best it possibly can be. We need to hear that commitment from John Key now.”

My answer is simple. No.

An agreement  was signed and agreed to after great negotiation last year. Taxpayers have been very generous with Christchurch, pumping billions into it. But the Council needs to now stand on its own two feet, and start making some hard decisions.

Finance committee chairman Cr Raf Manji said the council would need to take decisive action to put itself on a sound financial footing for the future.

“We have a strong balance sheet to help us weather this kind of financial challenge. KordaMentha makes it clear that there is no single simple solution but rather a number of levers that will need to be be used.

“Hard choices will need to be made and we will be relying on the residents of the city to engage with the council as it makes these decisions and charts a prudent and sustainable course forward,” Manji said.

The Council has a number of routes it can take:

  • Reduce the rebuild costs – the council needs to consider not doing some of the work planned.
  • Negotiate for the Crown to pay more money or for the council to pay less money for the anchor projects.
  • Increase the council’s core revenue through rate rises.
  • Cut spending in other areas such as the capital programme.
  • Improve the performance of council owned assets and investments, or sell them.

The left will ignore four of those options and just call for taxpayers to pay more. Real leadership would be making the hard decisions yourself.



Christchurch’s next Mayor?

April 2nd, 2014 at 7:00 am by David Farrar

Mike Yardley writes:

He’s the bolter, the bloodhound, the big-hitter. And he is fast stapling his presence on to the city’s consciousness.

Cr Raf Manji, the most impressive newcomer to council, wasn’t elected to office with a pasteurised set of opinions from party central or enslaved to a rigid ideology.

He is an independently minded raging pragmatist, spearheading the drive for better performance and fiscal restraint. The hear-no-evil, see-no-evil culture of conceited mediocrity is what sunk the previous council regime. Its prime adversary was the fearless first-term tiger, Cr Tim Carter.

Manji appears to have picked up the baton from Carter, bringing the same financial rigour and razor-sharp scrutiny to the table.

Take the past fortnight, for example. Manji has publicly grilled council staff for failing to adopt any measures against feckless freedom campers.

The council has had the power to regulate freedom camping for two years. Two years, amigos! Manji has blasted their “dithering” as “just ridiculous”.

I’ve heard several people say very good things about Cr Manji. As Yardley says he’s an independent focused on improving performance and holding the management to account. Dalziel is doing fine so far, but if things don’t improve over the next two years, I won’t be surprised to see Manji standing for Mayor.

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Dalziel on right track

February 12th, 2014 at 9:00 am by David Farrar

The Press editorial:

Councillors were told this week that the rating base had declined by 2.3 per cent and the council faces a larger-than-forecast operating deficit. The decisions to be made will undeniably be difficult and are likely to be unpopular.

There is one option that Mayor Lianne Dalziel appears to have ruled out.

“It’s not a question of adding to the rates; it’s a question of re-allocating within budgets,” she said.

That is the right approach. Rates are already set to rise by 6.5 per cent this year and probably by similar amounts in years to come. Just adding more to property owners’ rates burden would be evading the problem not facing it.

It’s good to see Lianne Dalziel rule out further rates increases. The Council needs to adjust its expenditure to match its income – not take more money off struggling ratepayers.

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Will Christchurch City Council join the stupidity?

February 5th, 2014 at 11:00 am by David Farrar

The Presss reports:

The Christchurch City Council is under pressure to find extra money to ensure all its employees get paid at least $18.40 an hour but its finance chairman is warning it cannot afford it.

“We are going through a process of cutting costs, not adding to them,” Cr Raf Manji said yesterday as councillors met to consider a report on the implications of introducing a Living Wage.

By law, workers must be paid a minimum of $13.75 an hour, but $18.40 is what the Living Wage movement believes a family of two adults and two children, where one adult works fulltime and the other works part-time, needs to meet basic living costs.

That is the key point. It is a calculation for one specific family type. That type of family is only around 10% of families earning under $18.40 an hour. Claiming that a 16 year old boy living at home must be paid $18.40 an hour because that is the income needed to support a family with two kids is ridiculous.

A report prepared for the council’s chief executive and employment matters committee, which met publicly for the first time yesterday, estimated the cost of increasing their hourly rate to $18.40 an hour at $1.1 million, excluding KiwiSaver, overtime and penal pay.

It also warned that introducing a Living Wage was likely to have a knock-on effect for other staff as the council would need to maintain relativities in remuneration.

That could add another $1 million to the council’s wage bill.

So proponents want ratepayers to pay an extra $2 million a year. Are ratepayers in Christchurch not already struggling enough?

Also the Councils seem to ignore the very serious flaws in the calculation by Rev Waldegrave, which include:

  1. Only 12% of low income households are two adults and two dependents, which the Waldegrave calculation is based on
  2. They assume you need 10 hours of childcare a week, even if the children are aged over 14
  3. They calculation of level of “basic necessities” is not based on any empirical measurement of the lowest cost of necessities, but merely a proportion of the average expenditure in deciles 1 to 5 (this one is key – it is a calculation based on the Browns should be spending as much as the Jones, and is not a calculation on how much income the Browns need)
  4. The calculation doesn’t account for some sources of household income such as trade-ins, sales, teenagers income (yet does include their costs) and school donation tax refunds
  5. The calculation double counts some expenditure such as childcare costs
  6. The calculation includes as a basic necessity costs such as Sky TV, pets, international travel and video games
  7. The calculation includes insurance for dwellings and mortgages, despite assuming they are renting

Any politician that advocates the living wage calculation as a serious way to do policy should not be trusted with finances.

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The Press on Mayoral accessibility

January 18th, 2014 at 12:00 pm by David Farrar

The Press editorial:

With the announcement this week of the appointment of a press secretary for Mayor Lianne Dalziel, along with a number of other appointments, the make-up of the mayor’s office is now complete. The mayor had earlier announced the appointment of a chief of staff to run the office. The mayor will have nine people working directly for her, more than twice the four that the former mayor, Bob Parker, had.

It would be interesting to compare the size of the various Mayoral offices to the sizes of their Councils.

In addition to a chief of staff and a press secretary, the mayor now has a senior adviser, a community adviser, a visits and ceremonials co-ordinator, two information officers and two executive assistants (one of them shared with the chief of staff). It must be hoped this staff will be committed to ensuring robust performance from the mayor’s office. It must also be hoped they will be committed to the greatest possible transparency and openness about the mayor’s work.

The mayor’s community adviser is Nicola Shirlaw, who was Dalziel’s campaign manager for the council election. That political connection is of no great significance by itself but the mayor must take care not to allow her office to become highly politicised or excessively inward-looking.

Of course it will be politicised. The job of the Mayor’s office is to get the Mayor re-elected. There’s nothing wrong with that per se. A Mayor who is doing a good job is more likely to be re-elected, so part of what the Mayoral office does is help the Mayor perform well. But they also of course promote the Mayor and try and get favourable coverage.

The office must also not become a barrier between the mayor and the media and public. Parker was commendably available to the media – replying with remarkable diligence and promptness to emails, texts and phone calls, even at the height of his political travails when there was little benefit to him from doing so. Dalziel is proving to be less accessible.

I didn’t know that about Parker. Good on him.

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