Wellington Airport 'mystified' by council's decision to scrap $76 million loan for seawall upgrade

Thursday, 4 March 2021

Wellington City Council has agreed to scrap a $76 million loan earmarked for Wellington Airport seawall upgrades, following confusion what the money would be used for. (File photo)

Wellington Airport chief executive Steve Sanderson says he is “mystified” by the city council’s decision to remove $76 million of funding for the airport’s seawall upgrade.

Councillors voted 8-7 on Thursday to remove the loan from the council’s draft 10-year plan following concerns the money would also be used for a proposed $300m runway extension.

Sanderson said in a statement following the vote he was stunned by the council’s late decision to remove funding, which was critical to the seawall upgrade.

“We are mystified by Wellington City councillors deciding to withdraw funding for the airport’s seawall, which requires essential upgrades for resilience, safety and infrastructure protection,” Sanderson said.

Wellington Airport chief executive Steve Sanderson says he is “mystified” by Wellington City Council's decision to pull $76 million of funding for seawall upgrades. (File photo)

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Wellington City councillor Tamatha Paul believes the funding for seawalls will also be used towards the airport’s planned runway extension. (File photo)

“The council has been debating the wrong issue by conflating this project with the runway extension.”

The vote came about following a proposal from councillor Tamatha Paul to remove the funding from the council’s draft 10-year plan.

Paul said she met with airport representatives recently to discuss their terminal expansion plans. (File photo)

It was due to be loaned to the airport over three years from year seven (2027-28) of the plan.

Paul said she and some other councillors believed funding for the runway project had recently been removed from the council's budget, but was advised by council staff a week ago it was still there.

The budget showed funding of $76.6m over three years for “seawalls”, appearing as a loan under operating expenditure. The council had previously agreed to a $90m grant for the runway extension, under capital expenditure.

There was considerable confusion among councillors during a long-term plan committee meeting on Thursday about where exactly the money was going, with Paul and others believing it was at least partly contributing towards the runway extension.

Chief financial officer Sara Hay suggested councillors resolved the uncertainty by stipulating that any loan to the airport be used for seawall upgrades only, if Paul's proposal to remove the funding was unsuccessful.

“We are disappointed councillors chose to make this decision without consulting the airport and without accurate information,” Sanderson said.

“We would have been happy to discuss these matters with councillors, but were not approached or advised of the intention to raise this matter at today’s meeting.

Wellington City Council had previously agreed to provide a $90 million grant for the airport’s proposed runway extension. (File photo)

“We will assess alternative funding options, but would have liked to see the council playing its part in protecting its own sewerage and roads.”

Paul said it was “surprising and disingenuous” for the airport to claim they were mystified.

“The airport was on notice about this when the council declared a climate emergency,” Paul said.

“The council and the thousands of Wellingtonians who went on the climate strikes are serious.”

Paul said she met with airport representatives on February 5 to discuss concerns over the airport’s terminal expansion plans.

“They should be in no doubt of my position on this matter. I remain happy to discuss this further with them.”

Wellington Airport chair Tim Brown emailed councillors early on Thursday morning after learning of the proposal, urging them to retain the funding.

Brown said removing it would be a “material signal of bad faith” and would have a critical impact on the upgrade plans, including a runway extension to enable long-haul flights.

“As airlines change their fleet to improve efficiency, the requirements of the runway also change,” Brown said.

“For instance, Air New Zealand is introducing A321 aircraft to replace its A320s. The new aircraft uses 22 per cent less fuel per passenger kilometre. By the time Air New Zealand fully replaces its fleet, changes to the runway will be required to safely accommodate these larger aircraft.

“Finally, there is the [necessary] extension of the runway operational and safety length to enable long-haul flights directly to Asia and North America.”

Brown said he wanted the council to “remain true to its initial indication of conditional support”, and that a new seawall was needed regardless of whether the runway extension went ahead. The runway project is currently on hold.

Removing airport seawall funding – how they voted:

For: Jill Day, Fleur Fitzsimons, Laurie Foon, Sarah Free, Rebecca Matthews, Teri O’Neill, Iona Pannett, Tamatha Paul. Against: Andy Foster, Diane Calvert, Jenny Condie, Sean Rush, Malcolm Sparrow, Simon Woolf, Nicola Young.