1 00:00:00,280 --> 00:00:02,360 Speaker 1: And with us right now is the finance minister Nikola 2 00:00:02,400 --> 00:00:05,720 Speaker 1: will I say Nikola, Hi, Ever, so what's the plan 3 00:00:05,760 --> 00:00:07,080 Speaker 1: for the fairies? What are we going to do? 4 00:00:09,000 --> 00:00:11,760 Speaker 2: Well? The plan is, first we have to ensure that 5 00:00:12,080 --> 00:00:16,840 Speaker 2: Kiwi Rail is maintaining its current feries well, because it's 6 00:00:16,880 --> 00:00:19,360 Speaker 2: always been the case that no new ships were due 7 00:00:19,360 --> 00:00:21,960 Speaker 2: to arrive until at least twenty twenty six, so there's 8 00:00:22,000 --> 00:00:25,960 Speaker 2: been an ongoing expectation that they maintain their existing fleet well. 9 00:00:26,600 --> 00:00:29,120 Speaker 2: The second piece is that it's clear that these are 10 00:00:29,200 --> 00:00:33,640 Speaker 2: aging vessels which will require replacement, and so we have 11 00:00:33,800 --> 00:00:38,640 Speaker 2: taken advice from an independent expert ministerial group about how 12 00:00:38,680 --> 00:00:41,600 Speaker 2: we should replace them. The good news is that group 13 00:00:41,640 --> 00:00:44,080 Speaker 2: has said to us, look, you've got some good options here. 14 00:00:44,240 --> 00:00:46,680 Speaker 2: You can get replacement ships, you can get them in 15 00:00:46,760 --> 00:00:49,240 Speaker 2: a timely manner before the end of life of these 16 00:00:49,280 --> 00:00:52,720 Speaker 2: current ships, and we're just working through as ministers the 17 00:00:52,760 --> 00:00:54,640 Speaker 2: best way to achieve that. 18 00:00:54,840 --> 00:00:57,080 Speaker 1: Okay, So what are they saying there's some available on 19 00:00:57,080 --> 00:00:58,000 Speaker 1: the second hand market. 20 00:00:59,280 --> 00:01:02,720 Speaker 2: Well, no, it's more likely that they would be procured you, 21 00:01:03,360 --> 00:01:05,319 Speaker 2: and there are some options for how we achieve that. 22 00:01:05,760 --> 00:01:07,440 Speaker 1: What is the end of life? What do you consider 23 00:01:07,480 --> 00:01:09,080 Speaker 1: the end of life of the existing fairies. 24 00:01:09,959 --> 00:01:13,120 Speaker 2: Well, I understand that the most recent advice that Kiwi 25 00:01:13,160 --> 00:01:16,720 Speaker 2: Rail has had of an independent assessment of the existing 26 00:01:16,800 --> 00:01:21,520 Speaker 2: theories is that those fairies can keep operating safely and 27 00:01:21,560 --> 00:01:23,920 Speaker 2: reliably until at least twenty twenty nine. 28 00:01:24,520 --> 00:01:27,400 Speaker 1: Well, are you serious we're going to have to do 29 00:01:27,440 --> 00:01:29,679 Speaker 1: another five or six years with these things? 30 00:01:30,600 --> 00:01:32,720 Speaker 2: Well, they need to be maintained, Well, they need to 31 00:01:32,720 --> 00:01:33,880 Speaker 2: be operated liically. 32 00:01:33,920 --> 00:01:35,960 Speaker 1: You can't be comfortable with that. I mean, look at 33 00:01:35,959 --> 00:01:38,280 Speaker 1: what's happened to this fery. The fairy they couldn't even 34 00:01:38,319 --> 00:01:40,520 Speaker 1: steer it, and it's not even the first time that 35 00:01:40,560 --> 00:01:43,480 Speaker 1: they couldn't steer the ferry. The same thing happened earlier 36 00:01:43,560 --> 00:01:46,600 Speaker 1: as well. Do you really believe it's going to be okay? 37 00:01:46,600 --> 00:01:48,200 Speaker 1: And key We should be on board these things. 38 00:01:49,280 --> 00:01:52,040 Speaker 2: The government is committed to ensuring that we've got safe, 39 00:01:52,040 --> 00:01:55,960 Speaker 2: reliable vessels, and we completely accept that we want to 40 00:01:56,000 --> 00:01:59,600 Speaker 2: replace the existing vessels and we've got time to do that. 41 00:01:59,680 --> 00:02:02,280 Speaker 2: And of course i'd like to see replacement ships ahead 42 00:02:02,280 --> 00:02:04,680 Speaker 2: of twenty twenty nine, there's no question about that. 43 00:02:04,880 --> 00:02:07,440 Speaker 1: Because I mean, you're criticizing key We Rail for the 44 00:02:07,520 --> 00:02:09,920 Speaker 1: servicing that they just had the steering replaced. 45 00:02:11,840 --> 00:02:15,040 Speaker 2: Well. K WE Rail are yet to explain exactly what 46 00:02:15,160 --> 00:02:17,160 Speaker 2: went wrong here and will await the explanation. 47 00:02:18,520 --> 00:02:21,440 Speaker 1: But is it fair to criticize them for the maintenance 48 00:02:21,800 --> 00:02:26,079 Speaker 1: if they are maintaining there. What I'm trying to say, 49 00:02:26,200 --> 00:02:28,920 Speaker 1: is maintenance actually an issue here? Or is it the 50 00:02:28,919 --> 00:02:30,560 Speaker 1: thing is just so old even if you try to 51 00:02:30,600 --> 00:02:31,440 Speaker 1: maintain that you can't. 52 00:02:32,480 --> 00:02:36,280 Speaker 2: Well, this is the point I'm making. An independent expert 53 00:02:36,360 --> 00:02:38,880 Speaker 2: has looked at the ships and said, actually, is it 54 00:02:38,919 --> 00:02:42,160 Speaker 2: safe and reliable to keep these things going? Is that possible? 55 00:02:42,760 --> 00:02:45,200 Speaker 2: And they're more expert than I am or you are, 56 00:02:45,480 --> 00:02:48,280 Speaker 2: and I've said, yes, it is. So I've got to 57 00:02:48,320 --> 00:02:52,080 Speaker 2: rely on independent experts here and their advice. None of 58 00:02:52,080 --> 00:02:55,680 Speaker 2: that stops the fact that k WE Rail also need 59 00:02:55,760 --> 00:02:57,760 Speaker 2: to make sure they're doing everything right in the way 60 00:02:57,800 --> 00:03:00,160 Speaker 2: that they operate those ships and maintain those ships. And 61 00:03:00,600 --> 00:03:03,520 Speaker 2: I think all of us accept that we prefer to 62 00:03:03,560 --> 00:03:05,840 Speaker 2: have new ships, so we're making sure we do that. 63 00:03:05,880 --> 00:03:07,519 Speaker 2: But you know what, we've got to do that sensibly 64 00:03:07,840 --> 00:03:10,919 Speaker 2: because the last proposal that was on the table, those 65 00:03:10,960 --> 00:03:15,000 Speaker 2: ships were so much bigger around forty meters longer, round 66 00:03:15,040 --> 00:03:18,280 Speaker 2: ten meters wider that they wouldn't have actually fit in 67 00:03:18,280 --> 00:03:20,640 Speaker 2: the existing verds at either port. There was a real 68 00:03:20,720 --> 00:03:22,880 Speaker 2: question about whether the ports could be fixed up in 69 00:03:22,919 --> 00:03:26,440 Speaker 2: time for their arrival. Then the harved master had concerns 70 00:03:26,480 --> 00:03:29,160 Speaker 2: about whether those ships would be maneuverable in the narrow 71 00:03:29,200 --> 00:03:32,760 Speaker 2: straits of the Tory Channel and coming into the Sound. 72 00:03:33,400 --> 00:03:35,600 Speaker 2: So to say that there was a magic answer on 73 00:03:35,640 --> 00:03:36,920 Speaker 2: the shelf, that's dreaming. 74 00:03:37,360 --> 00:03:39,600 Speaker 1: Look, I agree that you made the right call in canceling, 75 00:03:39,640 --> 00:03:41,080 Speaker 1: and I just wonder if we should have got onto 76 00:03:41,200 --> 00:03:46,120 Speaker 1: ordering newer ones earlier. If you are to buy new ones, 77 00:03:46,360 --> 00:03:48,600 Speaker 1: has your expert group told you how much they're going 78 00:03:48,640 --> 00:03:49,040 Speaker 1: to cost? 79 00:03:50,480 --> 00:03:55,560 Speaker 2: Our excerpt Our group has given us a range of costs. 80 00:03:55,640 --> 00:03:58,480 Speaker 2: But the key thing, of course is who we go 81 00:03:58,560 --> 00:04:01,840 Speaker 2: with the specification and ares a cabinet. We're working through 82 00:04:01,920 --> 00:04:06,320 Speaker 2: all of that and what's the range. Look, it varies, Heather, 83 00:04:06,400 --> 00:04:08,960 Speaker 2: and I don't want to throw a number out publicly 84 00:04:09,040 --> 00:04:12,000 Speaker 2: for the simple reason that this is incredibly commercially sensitive. 85 00:04:12,640 --> 00:04:15,240 Speaker 2: We are working with shipbuilders and I don't want to 86 00:04:15,280 --> 00:04:17,000 Speaker 2: precice any of those discussions. 87 00:04:17,080 --> 00:04:19,520 Speaker 1: Is it going to be more expensive potentially than the 88 00:04:19,520 --> 00:04:21,719 Speaker 1: ones you just canceled, Well. 89 00:04:21,560 --> 00:04:22,960 Speaker 2: I'll tell you what will be a heck of a 90 00:04:22,960 --> 00:04:25,760 Speaker 2: lot cheaper, and that is the cost of the infrastructure 91 00:04:25,839 --> 00:04:27,479 Speaker 2: required at port to take. 92 00:04:27,720 --> 00:04:30,320 Speaker 1: But the boat itself could potentially be more expensive. 93 00:04:31,560 --> 00:04:33,240 Speaker 2: Wellever, I say, I'm not going to give a number 94 00:04:33,279 --> 00:04:35,280 Speaker 2: on what we think the ships will cost until I've 95 00:04:35,320 --> 00:04:38,680 Speaker 2: had a proper tender process and I've looked at proper documents, 96 00:04:38,760 --> 00:04:41,640 Speaker 2: or until I've had a proper number from a shop shipbuilder. 97 00:04:41,720 --> 00:04:43,800 Speaker 2: So I don't think it would be a good idea 98 00:04:43,839 --> 00:04:45,400 Speaker 2: to play a guessing game with that number. 99 00:04:45,520 --> 00:04:48,359 Speaker 1: Have we actually canceled the contract for the Big Fairies? 100 00:04:49,920 --> 00:04:53,839 Speaker 2: We're in a negotiation process at the moment with HMD. 101 00:04:54,000 --> 00:04:57,919 Speaker 2: Who are the Korean builders who were contracted to build 102 00:04:57,960 --> 00:04:58,880 Speaker 2: the very large ship? 103 00:04:59,160 --> 00:05:01,080 Speaker 1: What's that a negotia? If you want to cancel it, 104 00:05:01,160 --> 00:05:02,400 Speaker 1: just go to them and say cancel. 105 00:05:03,880 --> 00:05:07,160 Speaker 2: Oh well, obviously these contracts are pretty complex and there's 106 00:05:07,160 --> 00:05:08,480 Speaker 2: a range of things to work through. 107 00:05:09,040 --> 00:05:10,080 Speaker 1: The break fee right. 108 00:05:11,760 --> 00:05:15,840 Speaker 2: Well, and also this question of whether or not HMD 109 00:05:15,960 --> 00:05:19,120 Speaker 2: would be appropriate to build smaller in future. 110 00:05:19,760 --> 00:05:23,159 Speaker 1: How big is the break fee, Well, that will. 111 00:05:23,040 --> 00:05:26,000 Speaker 2: Depend on the negotiations that are underway. 112 00:05:26,080 --> 00:05:28,400 Speaker 1: Oh, I see, so it could potentially be smaller if 113 00:05:28,400 --> 00:05:30,760 Speaker 1: we keep them building the big ones, but go for 114 00:05:30,839 --> 00:05:33,360 Speaker 1: smaller ones as well. Like if we negotiate with them 115 00:05:33,400 --> 00:05:35,400 Speaker 1: for the next round that we want, it could bring 116 00:05:35,440 --> 00:05:36,120 Speaker 1: that break fee down. 117 00:05:36,160 --> 00:05:39,320 Speaker 2: Yeah, these are all things that we're working through. 118 00:05:39,520 --> 00:05:42,240 Speaker 1: Okay, how much money did you guys lose on that 119 00:05:42,240 --> 00:05:43,400 Speaker 1: failed ETS auction? 120 00:05:45,320 --> 00:05:48,560 Speaker 2: Well, we didn't lose money as such. The point with 121 00:05:48,640 --> 00:05:52,039 Speaker 2: the emissions trading scheme is that it's a market. There 122 00:05:52,080 --> 00:05:55,760 Speaker 2: are a number of options each year, and like any 123 00:05:55,880 --> 00:05:58,320 Speaker 2: market price discovery occulse. 124 00:05:58,520 --> 00:06:00,680 Speaker 1: Yeah, because I just noticed that there's normally but in 125 00:06:00,720 --> 00:06:02,440 Speaker 1: the past we've had a figure attached to it, but 126 00:06:02,480 --> 00:06:04,120 Speaker 1: not this time. Do you know how much it was 127 00:06:04,120 --> 00:06:05,920 Speaker 1: that that was lost in the auction? 128 00:06:07,120 --> 00:06:11,400 Speaker 2: Look, I just get given repeatedly, very clear advice don't 129 00:06:11,440 --> 00:06:15,280 Speaker 2: start commenting on the auction in any detail because actually 130 00:06:15,320 --> 00:06:18,880 Speaker 2: you could compromise the effectiveness of that auction in future. 131 00:06:18,920 --> 00:06:21,360 Speaker 2: So I'm going to be really careful. There no fair enough. 132 00:06:21,400 --> 00:06:23,520 Speaker 2: I like to be candid in upfront, but that is 133 00:06:23,560 --> 00:06:24,400 Speaker 2: one thing I don't want to. 134 00:06:24,320 --> 00:06:27,320 Speaker 1: Comp and I appreciate it. I understand that. I see 135 00:06:27,320 --> 00:06:29,880 Speaker 1: that there's some suggestion that maybe there are other industries 136 00:06:29,920 --> 00:06:32,480 Speaker 1: now who also want exemptions because forestry got an exemption 137 00:06:32,520 --> 00:06:34,680 Speaker 1: in farming got an exemption. Is that the case. 138 00:06:36,279 --> 00:06:39,480 Speaker 2: Well, in the case of farming is a very good reason. A. 139 00:06:39,720 --> 00:06:43,479 Speaker 2: It's leading, so it's a different gas and we're actually 140 00:06:43,520 --> 00:06:46,479 Speaker 2: doing our work currently to look at what that means 141 00:06:46,480 --> 00:06:48,760 Speaker 2: in terms of the way it's treated and in the 142 00:06:48,800 --> 00:06:53,640 Speaker 2: case of forestry those that's providing a really good carbon sink. 143 00:06:54,160 --> 00:06:57,560 Speaker 2: So beyond that, we don't have any proposals to withdraw 144 00:06:57,640 --> 00:06:58,800 Speaker 2: anything from the eat us. 145 00:06:59,200 --> 00:07:02,040 Speaker 1: Hey, Nicola, I'm asking you this because you're a Wellington 146 00:07:02,080 --> 00:07:04,960 Speaker 1: based MP and that's really the only kind of significance 147 00:07:04,960 --> 00:07:09,080 Speaker 1: of that. But if your council, Wellington City Council, does 148 00:07:09,080 --> 00:07:11,560 Speaker 1: the extraordinary thing of being unable to pass the long 149 00:07:11,640 --> 00:07:15,000 Speaker 1: term Plan on Thursday, which seems to be a live possibility, 150 00:07:15,200 --> 00:07:17,080 Speaker 1: do you think the government needs to step in here? 151 00:07:18,480 --> 00:07:21,080 Speaker 2: Because that was the case, if the council couldn't pass 152 00:07:21,160 --> 00:07:25,600 Speaker 2: its own plan, I would be set up on behalf 153 00:07:25,640 --> 00:07:29,320 Speaker 2: of Wellingtonian because actually they just want for his local 154 00:07:29,360 --> 00:07:33,360 Speaker 2: body politicians to get on and govern a city which 155 00:07:33,400 --> 00:07:36,920 Speaker 2: actually has leaking water pipes and all sorts of challenges. 156 00:07:37,320 --> 00:07:39,720 Speaker 2: So at the point that the council decides it won't 157 00:07:39,760 --> 00:07:43,720 Speaker 2: pass its own plan. Well, it's really making it clear 158 00:07:44,000 --> 00:07:45,880 Speaker 2: that it's not up to the task and so then 159 00:07:45,920 --> 00:07:48,560 Speaker 2: the government will have to look at that and say 160 00:07:48,560 --> 00:07:49,120 Speaker 2: what next. 161 00:07:49,840 --> 00:07:52,560 Speaker 1: So you would consider it. 162 00:07:53,880 --> 00:07:57,200 Speaker 2: Well, I mean to me, it's almost unfathomable Heather, that 163 00:07:57,320 --> 00:08:01,080 Speaker 2: a council would not pass its own plan. And if 164 00:08:01,120 --> 00:08:04,520 Speaker 2: that happens, that will be a novel thing, and I 165 00:08:04,520 --> 00:08:06,600 Speaker 2: think that will be a matter for me and Brown 166 00:08:06,760 --> 00:08:10,200 Speaker 2: to consider. I would throw my hands up in despair 167 00:08:10,840 --> 00:08:13,520 Speaker 2: and I think that it would warrant quite serious action. 168 00:08:13,720 --> 00:08:17,120 Speaker 2: I think Wellingtonian's would be pretty fed out and at 169 00:08:17,120 --> 00:08:19,160 Speaker 2: that point something serious would have to happen. 170 00:08:19,240 --> 00:08:22,000 Speaker 1: So I appreciate how carefully you're choosing your words. Then, Nichola, 171 00:08:22,080 --> 00:08:24,680 Speaker 1: thank you very much, really appreciate your time. That's Nichola Willis, 172 00:08:24,680 --> 00:08:28,520 Speaker 1: the Finance Minister. For more from Hither Duplessy Allen Drive, 173 00:08:28,680 --> 00:08:32,120 Speaker 1: listen live to news talks. It'd be from four pm weekdays, 174 00:08:32,200 --> 00:08:34,400 Speaker 1: or follow the podcast on iHeartRadio.