Councillors face key airport shares vote

Whether Wayne Brown has the support he needs to pass his controversial budget proposal today will only be known when the votes are counted.

But whether all of his 20 councillors would be able to vote was up in the air yesterday as Auckland Council and the Auditor-General worked through conflict of interest issues for two councillors whose spouses own airport shares.

Brown caused a halt in the trading of Auckland International Airport Limited’s shares when he incorrectly told councillors the airport would be raising funds for a new domestic terminal during a debate on his initial budget proposal before councillors voted for the plan to proceed to public consultation.

More than 40,000 Aucklanders had their say and councillors have hashed out the potential impact of the budget in closed-door workshops since April.

There are a number of big issues that need to be resolved today. They include whether to sell council’s $2.2 billion worth of airport shares, how much to raise rates and debt, and where to make – and hold off – on spending cuts.

Last week, Brown presented his refreshed proposal to an invite-only audience, highlighting his conviction that the council’s airport shares need to be sold to reduce council debt.

Brown’s theory is that by selling the shares, council would save $100 million a year in interest and help close the projected budget gap of $325m, plus another $50m of storm costs, for the start of the new financial year on July 1.

Several councillors have told Stuff they are concerned that if the shares are sold, the proceeds will disappear into paying off debt with nothing left to show for the asset.

Maungakiekie-Tāmaki ward councillor Josephine Bartley has voiced concern about the way the interest costs have been represented in relation to the shares.

Bartley said community members have heard in the media it costs $100m a year to hold onto the airport shares.

‘‘I don’t want people to be misled to think the $100m is for the shares specifically when the shares were given for free.’’

But Bartley is concerned the message being sent to the public is those interest costs stem directly from the shares.

‘‘It affects what people understand, and they form their opinion based on information that isn’t clear.’’

But if councillors don’t vote to sell the shares, they will need another solution in order to keep rates in line with inflation.

Howick ward councillor Maurice Williamson told Stuff the consequences of not selling would result in a big rates increase.

‘‘If you click no airport sale, then rates go to 15 or 17%,’’ Williamson said.

But councillors’ options are constrained by what was consulted on in the original budget proposal, including a maximum rates rise of 13.5%.

‘‘There is a part of the calculator that says there is no solution. If I don’t want to reinstate those unpleasant cuts and I won’t sell the airport shares, there’s no solution,’’ said Williamson.

Just what the solution is that councillors come to will be seen today.