Property editor of the NZ Herald

Leaky building bill to haunt Auckland descendants

Chris Darby said he could not tell whether the budgeted amount would cover the actual spending on weathertightness claims. Photo / Sarah Ivey
Chris Darby said he could not tell whether the budgeted amount would cover the actual spending on weathertightness claims. Photo / Sarah Ivey

Auckland Council has budgeted $291 million for the leaky building disaster and its financial forecasts indicate it will become an inter-generational issue.

Chris Darby, an Auckland councillor, asked council officials for data.

He wanted to know about the number of claims now lodged, the number expected, the impact on council funds, how the issue was being dealt with and who will pay for it.

Darby found that it will take decades before the disaster is off the council books and ratepayers not even born yet will be paying because the council expects to be funding the issue through to 2045.

"The Long Term Plan 2015-2025 sets out assumptions relating to the financial impact of weathertightness claims, including lodged and potential claims. The forecast is $291 million over the 10-year Long Term Plan period," he said.

"A further stated assumption is that this sum is funded from borrowings with repayments spread over 30 years. That is a 30-year discharge of liability from council's books. The impact of weather ingress in the 1990s and early 2000s will effectively be paid for in part by future ratepayers who were not even born when the issues arose."

The council has taken responsibility for this area away from one department and moved it to another.

"Legal Services took over the management of the weathertight claims in January. The number of weathertight proceedings on the books is 46, 13 of these in the Weathertight Homes Tribunal, including two multi-unit claims."

The remaining 33 claims are in the High Court, most being multi-unit claims, Darby said.

Darby said he could not tell whether the budgeted amount would cover the actual spending on weathertightness claims.

"The other interesting aspect is the repayments for borrowings are to extend over 30 years. So effectively the weathertightness cost or liability to ratepayers won't be off the books until 2045."

Darby himself has been a leaky building victim and took a claim against the council.

However, he is prevented from speaking about that due to a confidentiality agreement that forms part of his settlement.

The biggest leaky building claim filed names the council.

Owners of the 285-unit St Lukes apartment complex want $75 million from many parties including manufacturer and supplier Nauhria Precast, architects Woodhams Meikle, Styles Project Management, Wallace Construction, engineers Day Consultants, Tony Day, St Lukes Holdings, developer Arthur Morgenstern and Express Aluminium.

- NZ Herald

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