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Christchurch’s quake exit plan: What’s the rush?

A “global settlement” for post-quake Christchurch has taken six years. Why isn’t the public getting more of a say?

A Government deal to determine the future of certain land and buildings in post-quake Christchurch might breach the Local Government Act, former mayor Garry Moore says. At the very least, he believes the council’s breached one of its own policies.

Council documents make it clear it believes it’s dotted the i’s and crossed the t’s, by including proposals in long-term plans and apportioning budgets for running costs. But Moore questions if it has done enough. He’s calling on councillors to seek more time to make more informed decisions.

What has happened is an infernal wait followed by what seems, to some, as an unholy rush.

The Crown created agencies dedicated to rebuilding Christchurch after the 2010 and 2011 quakes. A cost-sharing agreement signed by the council and the Government in 2013 – negotiated behind closed doors – laid out who would pay for what, with the Crown to pay $2.9 billion of an estimated $4.8 billion bill.

Most of the council’s portion was “horizontal infrastructure” – underground pipes and roads. But it also agreed to pay hundreds of millions of dollars towards projects including a new multi-purpose arena, a metropolitan sports centre, a performing arts precinct, and bus interchange.

The cost-sharing agreement, criticised by Mayor Lianne Dalziel for being signed too close to the 2013 election, was refreshed two years ago. Proposals included transferring ownership of residential “red zone” land – land bought by the Crown, for about $1.5 billion, considered too damaged for houses without cost-prohibitive remediation work – to the council at no cost.

“At the moment it’s like a great big bear rolling over on top of us.” – Gary Moore

Only on Monday last week – six years after the cost-sharing agreement was signed – did the council release details of the draft agreement with the Government, called a “global settlement”. Councillors will today hear 10-minute deputations and they’re scheduled to vote on the deal on Thursday.

One of those being heard this morning is Moore, who is still deeply plugged into council issues through meetings of his influential Tuesday Club. He thinks the draft agreement, as produced, breaches section 97 of the Local Government Act. That section says certain decisions, including the transfer of ownership of a strategic asset, can only be taken if they’ve been provided for in the long-term plan.

Moreover, the council’s own significance and engagement policy says: “A decision to transfer the ownership or control of a strategic asset cannot be made unless it is explicitly provided for in the Council's Long Term Plan (LTP) and the public is consulted through the Special Consultative Procedure (SCP).”

Brendan Anstiss, the council’s general manager of strategy and transformation, was part of the council’s negotiating team. When asked how the council has planned for the draft agreement he points to capital payments and operating budgets included in previous annual and long-term plans. Council papers for Thursday’s meeting – which rates the decision as “medium” significance – says: “There are no unbudgeted impacts on the council from the global settlement agreement, although timing of payments will put pressure on interest revenue.”

It also says the council is doing “as much as it can” to consult the public and its significance and engagement policy states it can elect not to consult the public if a decision is needed urgently. Briefings were held with “interested parties, groups or individuals” in recent weeks.

Moore has many objections, including an apparent lack of supporting financial information, the rush to make a decision, and the “grossly inadequate” provision for ongoing costs.

“At the moment it’s like a great big bear rolling over on top of us and saying look we’ve done all these things for you, be grateful, this is what you’re going to do, and this is what you’re going to get, and we’re doing the rest. To me that’s just straight bullying.”

Christchurch doesn’t moan about the Government spending a fortune in Auckland, he says, because previous councils didn’t invest properly in infrastructure. “That’s fine, but you’ve got to make sure that the largest city in the South Island’s looked after properly and stop treating us like we are subservient to you,” he says. “It’s time for us to actually bare our teeth.”

Not set in stone

The draft agreement contains some interesting details.

While the convention centre, Te Pae, will be delivered by Crown-owned company Ōtākaro, the agreement notes: “The parties may continue to engage on future ownership of Te Pae as appropriate.”

Any cost overruns for the proposed metro sports facility will be sorted out using “pragmatic and cost-effective solutions”. The draft agreement sets a wind-down clause for unpopular Crown and council-owned agency Regenerate Christchurch. (Ōtākaro, meanwhile, is responsible for several major projects, including the convention centre and the metro sports facility, and yesterday it announced a plan to develop what’s known as the Avon Loop. Christchurch Rebuild Minister Megan Woods says “the intention is for it to be able to get on with that job”.)

The Government wasn’t interested in paying more for Christchurch’s underground pipes and roads. But it does mention point to the fact that the council’s getting the red zone, spanning about 600 hectares, for no cost, “providing the council a significant opportunity” to improve stormwater treatment and flood protection.

The Government’s $300 million Christchurch acceleration fund will be used to partially pay for a multi-use arena, an Ōtākaro Avon River corridor project, and transport infrastructure.

Woods says in an emailed statement that the Crown has invested heavily to rebuild Canterbury. “But we are now in a phase where the city has recovered to the point where the Crown’s extraordinary involvement in the city can end and we can return to local leadership. That’s an exciting time and the global settlement is about setting up that future for Canterbury.

Don’t forget, she says, the Crown still intends to spend about $3 billion, the equivalent of the entire provincial growth fund. (Moore disputes Crown spending figures, saying its billions don’t include tax-takes, like GST and income tax. But Woods says she disagrees with that argument, which could be trotted out for any Government investment anywhere in the country.)

The Government hasn’t strong-armed the council into taking responsibility for things it didn’t want to, the Minister and Wigram MP says. The two parties have worked collaboratively and well together.

“The proof of this approach is in the final agreement. Many were speculating the Crown would force the convention centre on the city. This has not occurred.

“I’m happy that the negotiations have been guided by what’s best for Christchurch, not just what is best for either council or the Crown.”

Narrowing window of opportunity

Newsroom asked Anstiss to explain why the council was in such a rush, but his statement ignored the question. However, an email he sent to Bruce White, a chartered accountant and former company chief financial officer who is allied with former mayor Moore, sheds some light.

White said he was staggered at council’s urgency. Anstiss replied: “We have a window prior to the local body elections in October 2019, and then of course we would otherwise run into Xmas post-election, and then in 2020, central government elections.”

White pushes the council executive to provide any financial summary reports supporting the agreement. He responds that “no reports of this nature exist”. (Council papers reveal due diligence was done by Development Christchurch Ltd, supported by professional services firms, and material was reviewed by “relevant council staff”.)

Moore and his supporters don’t speak for everyone, of course.

Former mayor Sir Bob Parker’s orange and black jacket became ubiquitous as he led the city through the quakes. He says from Queensland, Australia, where he’s on business, that the settlement looks “pretty reasonable” and seems to reflect the original cost-share agreement.

“The city seems to have a win out of [not having to take on] the convention centre,” he says. “I don’t think there’s a city in the history of New Zealand that has received that level of support from any central Government, of any colour.”

However, Parker’s disappointed that some of the most significant projects in the cost-sharing agreement, like a new stadium and metro sports centre, that should have been completed years ago, are “still sitting on the shelf”. “That has been one of the reasons that the city is slow to recover and I feel sad that that’s happened,” he says. “I think that if we’d done the projects on the original timeframe we would be seeing a different result in our city today.”

“It’s not ideal but it’s what we’ve got.” – Evan Smith

Evan Smith, of rebuild lobby group Avon Ōtākaro Network, is a pragmatist. The settlement’s not ideal, he says, but at least it’s a way forward.

The council’s put aside millions in its long-term plan for the likes of flood stopbanks, and footbridges. Big-ticket items that have a strong business case earmarked for the red zone – such as an eco-sanctuary that accountant White is pushing – should attract external funding.

Even though some transitional uses of the red zones have been granted licences of up to five years, Smith says a Government get-out clause – the ability to cancel the licence with 90 days’ notice – has stalled development there. Some opportunities have been lost because of delays, he says.

“It’s really important that we try and progress that now, I think, rather than argue about the finer points.”

He compares the situation to being red-zoned. His house was red-zoned by the Government and he took a settlement, probably at a loss, so he could move on. Some of his neighbours are still pushing for a better deal – “They’re still struggling.”

While he’s worried about the level of service in the red zone, such as how often the council will mow the lawns, about 10 groups from the city’s east will make deputations to the council today. Their message is: “Get on with the job, sign it off, let’s get going.”

There’s limited ability for the council to tweak the agreement, Smith says, as there’s no guarantee Cabinet will agree to amendments. Both parties agreed to the draft so there’s a good possibility both parties will sign off on it.

“It’s not ideal but it’s what we’ve got.”

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