Up to $600m hole after sale of airport shares falls over: Who will foot the bill?

Saturday, 12 October 2024

A $400 million to $600 million dollar hole has opened up in Wellington City Council’s Long Term Plan after councillors voted down a plan to sell Wellington airport shares.

But it’s not clear how that will affect ratepayers or what services or projects might need to be cut.

After the divisive meeting on Thursday, mayor Tory Whanau warned the room they would “need to look at more cuts”.

When The Post asked just how much would need to be cut from the Long Term Plan, council staff replied it was too early to nominate any specific figures.

But council documents presented Thursday reveal cuts of between $400m to $600m in capital spending will need to be made.

A no-sale would include reductions in the Council’s borrowings and capital programme, and potentially reductions in services, the documents stated.

That means any project not yet started or absolutely necessary, like the Golden Mile upgrade or Zero Waste Strategy are likely in the line of fire, as well as projects put up for cuts in the past, like an upgrade to the Khandallah Pool.

Councillor Ben McNulty, who voted to overturn the sale, said he had “no idea” of the ramifications a no-sale would bring.

“I have no confidence or clear understanding on what the scope of the problem is.”

McNulty said councillors were only told just days before they voted on the long term plan in May that not proceeding would leave a $450 million budget hole.

But when when the idea of the airport sale was first floated, councillors were told there would be no impacts on council rates or levels of service. That had now blown out to $600 million.

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This number was described by several councillors as “scaremongering”.

McNulty said in June, when the Long Term Plan was passed, he pushed to fully investigate the ramifications of a no sale, but it was ruled out of order and voted down by councillors.

Nureddin Abdurahman, who led the Notice of Motion to bring the vote forward, said discussion about “what next?” had been missing from the council table.

“The advice we currently have is some numbers thrown around and we don't know where that is coming from.”

Abdurahman said it was vital the mayor lead the council and make the tough calls.

The long term plan will be put out for consultation on December 11 and T back for a final vote in June next year.

Councillor Tony Randle believed the cuts could bring down rates, as less money was spent, less work done, which meant less operating costs.

Randle said projects like the Zero Waste Strategy, which was over $100 million and had not yet begun and the Golden Mile project were “obvious choices” to be kicked.

Ray Chung said re-doing the Long Term Plan was a good thing, as it would give priority to urgent projects.

“I'm quite looking forward to it…I would like to see things cut because we just can't afford them and we just haven't realised it all this time.”

The mayor was approached for comment.