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Speaker 1: Kielder.

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Speaker 2: I'm Chelsea Daniels and this is the Front Page, a

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Speaker 2: daily podcast presented by the New Zealand Herald. The Government

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Speaker 2: has set its sights on sorting out Wellington City Council

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Speaker 2: after councilors last week voted against a plan to sell

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Speaker 2: shares in Wellington's airport. The city's long term plan will

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Speaker 2: need to be reopened. It's prompted Local Government Minister Simeon

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Speaker 2: Brown to seek advice on potential interventions, and he has

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Speaker 2: labeled the situation as shambles. So how bad have things

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Speaker 2: gotten in the capital today? On the front Page Herald,

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Speaker 2: Wellington Issues reporter and host of On the Tiles local Audition,

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Speaker 2: Georgina Campbell is with us to unpack the issues. Georgina,

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Speaker 2: let let's start with the airport's sale. Can you try

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Speaker 2: and summarize this whole saga? How did it start? Wid

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Speaker 2: died counselors change their mind and how did last week go?

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Speaker 3: Selling? Wellington City Council's thirty four percent share in the

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Speaker 3: airport was part of the long term plan, so that's

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Speaker 3: the ten year budget. The book value of the council's

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Speaker 3: airport shareholding was two hundred and seventy eight million dollars

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Speaker 3: in June twenty twenty three. However, the market value could

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Speaker 3: be as high as five hundred million dollars, so it's

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Speaker 3: quite a bit of money that we're talking about.

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Speaker 2: Now.

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Speaker 3: The proceeds of the sale we're going to be put

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Speaker 3: in a perpetual investment fund as a form of self

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Speaker 3: insurance for the council. The sale was designed to help

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Speaker 3: two quite serious financial risks on the books. That's the

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Speaker 3: fact that the council has a two point six billion

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Speaker 3: dollar under insurance problem and the lack of diversity and

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Speaker 3: its investment portfolio. Basically all the council's investments are either

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Speaker 3: in the airport years or ground. Importantly, Mayor Tory Fano

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Speaker 3: supported the sale and surprisingly, maybe to some managed to

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Speaker 3: find a majority around the council table to vote in

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Speaker 3: favor of it, just remembering that she's a Green endorsed mayor.

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Speaker 3: It's a left leaning council, you know, those on the

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Speaker 3: political left are usually opposed to the sale of public assets. Now,

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Speaker 3: three councilors then changed their minds, and it's really through

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Speaker 3: a spanner in the works for Tory Fano. The reason

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Speaker 3: they changed their minds is because capital spending was not

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Speaker 3: reduced to maintain this two hundred and seventy two million

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Speaker 3: dollars worth of insurance debt headroom, and that was the

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Speaker 3: condition of those three councilors supporting the sale. So, with

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Speaker 3: the numbers in favor weakening, counselors who were opposed to

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Speaker 3: the sale basically investigated whether they could vote on it

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Speaker 3: again during the long term plan process. The mayor basically

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Speaker 3: said no, and some councilors voted against the entire long

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Speaker 3: term plan in protest of that. Then we've had this

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Speaker 3: notice of motion to stop the sale, signed by a

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Speaker 3: majority of councilors, that was filed and debated at a

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Speaker 3: full council meeting last week, and of course we know

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Speaker 3: that that notice of motion was successful. The airport's sale

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Speaker 3: has been stopped. It's a significant loss for Torifano. The

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Speaker 3: sale has divided the council, it's cost her crucial support,

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Speaker 3: and it also comes after this other big loss that

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Speaker 3: she suffered, which was the Reading Cinema debarcle and the

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Speaker 3: plan to get that reopen, which has also failed.

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Speaker 2: So with that sale having failed, now, what does that

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Speaker 2: mean for the city's finances.

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Speaker 3: Well, it's not good. News that sale was a crucial

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Speaker 3: part of the council's financial strategy as part of its

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Speaker 3: long term plan. So now the long term plan has

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Speaker 3: to be amended to reflect that the sale is no

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Speaker 3: longer happening. Amendments to the long term Plan aren't unusual

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Speaker 3: like this happens quite a lot. The problem is is

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Speaker 3: that the repercussions of amending long term Plan to reflect

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Speaker 3: there's no longer going to be an airport sale is

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Speaker 3: that it could mean up to six hundred million dollars

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Speaker 3: in cuts to capital spending need to be found to

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Speaker 3: create that additional debt headroom to respond to insurance risks.

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Speaker 3: So that's quite a lot of money and it will

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Speaker 3: essentially involve redoing the long term plan because the question

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Speaker 3: is now what a council is willing to cut, and

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Speaker 3: it's always controversial, it's always going to create a lot

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Speaker 3: of debate around the table, and Torri Farno has said

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Speaker 3: that in terms of cuts, everything is on the table.

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Speaker 3: She has outlined some of her bottom lines or things

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Speaker 3: that are non negotiables for her. That's the one point

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Speaker 3: eight billion dollar investment in water infrastructure, the Golden Mile project,

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Speaker 3: and selling the Council's social housing portfolio. She said she'll

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Speaker 3: fight tooth and nail to protect these things. But you know,

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Speaker 3: she's only one vote around the table and she has

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Speaker 3: acknowledged that.

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Speaker 2: I mean, that's an astronomical amount of money that they've

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Speaker 2: got to now find. Basically, hey, you're not going to

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Speaker 2: find that at the back of the couch. And rates

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Speaker 2: in the city are already pretty high, right they are.

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Speaker 3: We have done an analysis of this and the typical

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Speaker 3: Wellington residential rates bill will be three thousand dollars more

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Speaker 3: expensive by twenty twenty eight based on current projections. And

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Speaker 3: this follows the latest rates increase, which averaged one thousand

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Speaker 3: dollars per household, or an increase of twenty one percent.

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Speaker 3: So these figures are based on current projections. They include

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Speaker 3: the Regional Council and Wellington City Council rates and a

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Speaker 3: new levee to pay for a wastewater sludge facility. But

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Speaker 3: the city council rates account for the lion's share of

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Speaker 3: these bills, and they're so high that Auckland Mayor Wayne

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Speaker 3: Brown actually referenced them in a social media video advertising

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Speaker 3: his citi's relatively low rates increase, which he credited his

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Speaker 3: ability to stop wasteful spending. And there's this clip in

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Speaker 3: the video where he's pointing to a map of metropolitan

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Speaker 3: rates increases, and he points to Wellington and says, let's

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Speaker 3: face it, things could be worse.

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Speaker 2: It's no coincidence that we've delivered the last rate rise

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Speaker 2: of any metropolitan center in the country, because, let's face it,

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Speaker 2: things could be worse.

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Speaker 3: You know, Wellington has basically experienced one of the highest

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Speaker 3: rates increases across the country this year, and that hurts,

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Speaker 3: like people are finding that tough.

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Speaker 1: I was about to say, when are you moving to Auckland.

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Speaker 3: Never, I'm definitely loyal Wellingtonian and not even low rates

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Speaker 3: increases could get me to Auckland.

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Speaker 1: I know that I knew that answer before I even

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Speaker 1: asked it.

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Speaker 2: Well, you spoke to Torifa now last week for on

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Speaker 2: the tiles after the vote.

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Speaker 1: Hey, what did she have to say about the situation?

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Speaker 3: Yeah, so she didn't see the vote as damaging to

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Speaker 3: her merial she and described it instead as a bit

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Speaker 3: of a blow. She said she woke up the following

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Speaker 3: morning and actually felt that a weight had been lifted

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Speaker 3: off her shoulders, kind of realizing in the past two

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Speaker 3: weeks that things were no longer going her way, and

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Speaker 3: she said, and is saying, you know this week as well,

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Speaker 3: that she has accepted the Democratic outcome, and you know

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Speaker 3: it says it's probably one of the most difficult decisions

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Speaker 3: that some counselors have had to make, and that she's

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Speaker 3: going to respect that decision. I did ask her, you know,

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Speaker 3: is she worried about what the legacy of her first

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Speaker 3: term would be? And she said, of course, she said,

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Speaker 3: it's been a difficult couple of years. But for this

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Speaker 3: final year, because of course it's local body elections again

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Speaker 3: next year, she's going to be super focused on delivering

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Speaker 3: this long term plan now that it has to be changed,

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Speaker 3: and she believes that they can still get there.

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Speaker 4: We're in a transition phase, you know, we're pushing through

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Speaker 4: a lot of change, and all that change and transition

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Speaker 4: is for the betterment of our city. Yes it's going

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Speaker 4: to be difficult. Yes it's going to create tensions, but

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Speaker 4: this is what changes like. And you know, hand on heart,

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Speaker 4: I believe in our long term plan, with or without

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Speaker 4: the airport, I will still want to achieve the same things.

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Speaker 4: But yes, I've made mistakes in the past, but I'm

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Speaker 4: someone who learns from them and moves on because at

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Speaker 4: the end of the day, all I care about is

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Speaker 4: Wellington City.

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Speaker 2: Incredibly, both Nikola Willis and Simeon Brown have come out

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Speaker 2: and labeled the situation as shambles.

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Speaker 1: Is that fair?

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Speaker 3: It's certainly very strong language for those ministers to be using,

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Speaker 3: and I think it highlights the seriousness of the situation,

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Speaker 3: like it's really not a good look to have to

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Speaker 3: amend a long term plan that the council has only

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Speaker 3: voted on as recently June. And I think, you know,

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Speaker 3: the most worrying thing is I've outlined is the ramifications

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Speaker 3: of that the spending cuts and I think we are

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Speaker 3: in different territory in terms of the threat of government

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Speaker 3: intervention at Wellington City Council compared to recent years.

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Speaker 1: On Wellington City Council. Are we yet at the stage

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Speaker 1: where the government intervens.

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Speaker 5: Well it's a shambles And the fact that the long

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Speaker 5: term plan is now having to go back to the

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Speaker 5: drawing board, that it's already one of the most highly

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Speaker 5: biggest increases in rates in the country. That Wellingtonians are

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Speaker 5: sort of despairing about the council's focus on itself rather

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Speaker 5: than the people it's meant to serve. Those are all

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Speaker 5: factors that I'm certainly concerned about, and I know that

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Speaker 5: the Minister for Local Government, Simeon Brown, is concerned about.

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Speaker 5: He is watching the situation very closely and he has

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Speaker 5: a number of options under the Local Government Act.

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Speaker 1: What could government intervention even look like?

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Speaker 3: Well, the Local Government Act says that the government can

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Speaker 3: intervene with the likes of a Crown observer or commissioners

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Speaker 3: if it's believed there is a significant problem. So a

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Speaker 3: problem means that at the very least, something that detracts

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Speaker 3: from a local authorities ability to meet its obligations under

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Speaker 3: the Act, and significant means that the problem will have

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Speaker 3: adverse consequences for ratepayers. So Simeon Brown has confirmed he's

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Speaker 3: asked for advice on potential interventions, and Nikola Willis has

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Speaker 3: hinted that it might be a Crown observer. That's more

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Speaker 3: likely in the first instance, so commissioners that's when the

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Speaker 3: whole council is voted out and they take over. A

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Speaker 3: Crown observer is a lesser form of intervention in that

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Speaker 3: they come in help the council to address its problems.

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Speaker 3: Monitor the council's progress and then recommend to the local

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Speaker 3: government minister whether further intervention is required.

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Speaker 2: That's pretty damning and actually, quite frankly, pretty embarrassing for

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Speaker 2: Tory Faro, right like having the government come in and

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Speaker 2: say you're you'll stop playing around with your toys.

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Speaker 1: We need to get someone to kind of babysit you.

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Speaker 3: It's certainly not what you want when you're the mayor

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Speaker 3: or an elected member to have to have central government

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Speaker 3: intervene because ministers are worried about the ability for you

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Speaker 3: to do your job and agree on important decisions. And

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Speaker 3: I have asked Tory Faro whether you know she thinks

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Speaker 3: government intervention is required, And I asked her this last

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Speaker 3: week before ministers started using this strong language, and she said, no,

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Speaker 3: you know, she thinks it's a very high bar to

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Speaker 3: reach something like that, and it is. But she said

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Speaker 3: the council would have to not be meeting its legislative requirements,

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Speaker 3: which she feels they're not even close to that point yet.

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Speaker 3: And she said no amount of public campaigning or trying

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Speaker 3: to convince the minister was going to do that. So

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Speaker 3: it will be interesting to see what the minister does.

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Speaker 2: She's had a pretty rough go of it during her

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Speaker 2: time as mayor. Already, Hey, there have been a few

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Speaker 2: unnecessary gaffes and a few high profile failed deals. Does

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Speaker 2: toy farnw have what it takes to sort this out?

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Speaker 1: Do you think?

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Speaker 3: Well, she certainly thinks that she does. I think only

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Speaker 3: time will tell, or maybe the government will decide that

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Speaker 3: for her by intervening.

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Speaker 2: Well, the government and the Council have been pre divided

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Speaker 2: on issues since they were voted in. There was that

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Speaker 2: agreement around Golden Mile and the second amount Victunnel where

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Speaker 2: they kind of agreed to disagree. I suppose on both

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Speaker 2: of those going ahead. Is there some potential for politicking

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Speaker 2: going on here?

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Speaker 3: I think that ministers will be keenly aware of the

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Speaker 3: of a right leaning government intervening in a left leaning council.

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Speaker 3: The optics being is the government just intervening because it

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Speaker 3: doesn't like the politics of the left leaning council. So

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Speaker 3: my impression is that they wouldn't be using this kind

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Speaker 3: of language unless there was this significant problem or the

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Speaker 3: potential for this significant problem as outlined in the Local

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Speaker 3: Government Act to warrant intervention, and sammyon Brown has basically

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Speaker 3: I think identified that there could be a problem here.

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Speaker 3: He's asking officials what they think. He'll get that advice

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Speaker 3: and then make the final call.

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Speaker 2: Georgina, you've covered council for years in Willington issues as well.

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Speaker 1: What would you like to see done to get things

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Speaker 1: sorted out?

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Speaker 3: I just would like our local politicians to put Wellingtonian's first.

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Speaker 3: This isn't the first council to be accused of division.

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Speaker 3: Andy's Council, which was the previous council, was also dealing

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Speaker 3: with a similar narrative. Wellington's doing it really tough at

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Speaker 3: the moment. There's this narrative that it's dying. I don't

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Speaker 3: think it is. We're going through significant changes and if

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Speaker 3: the Golden Mile project continues, that's going to be really

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Speaker 3: tough for businesses. There's going to be a lot of

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Speaker 3: rogue cones around for the next couple of years and

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Speaker 3: it would be nice to see some unity coming from

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Speaker 3: the people who we have elected to represent us.

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Speaker 2: Thanks for joining us, Georgina. That's it for this episode

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Speaker 2: of the Front Page. You can read more about today's

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Speaker 2: stories and extensive news coverage at ends at Herald dot

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Speaker 2: co dot nz. The Front Page is produced by Ethan Seals.

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Speaker 2: Dan Goodwin is the sound engineer. I'm Chelsea Daniels. Subscribe

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Speaker 2: to the front page on iHeartRadio or wherever you get

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Speaker 2: your podcasts, and tune in tomorrow for another look behind

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Speaker 2: the headlines.

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Speaker 5: M