Bid to keep port land for public use

ARC chairman Mike Lee. Picture / Dean Purcell

Preserving Auckland's waterfront for public use will be much easier under 100 per cent public ownership of Ports of Auckland, says Auckland Regional Council chairman Mike Lee.

Lee and Auckland Regional Holdings chairwoman Judith Bassett yesterday stressed that strategic long-term investment was the main reason behind the full takeover bid for the ports company.

The politicians - Bassett is also an ARC councillor - said all of the port company's land would remain in public ownership and that would assist in the "integrated development" of the total waterfront area for port operations and public use.

Lee said the present ownership model, which meant the ports company had to consider the interests of minority shareholders, had hamstrung moves to develop port land for public use.

If the takeover succeeded, Lee said a "direction" would come from ARH to the company based on the outcome of work by the ARC and Auckland City Council about comprehensive and integrated long-term planning and development for the waterfront.

Lee was guarded on whether any ports land could be transferred to another public body, such as the ARC or city council.

While a takeover would remove the barrier of taking minority shareholders' interests into account, directors of the ports company would still have an obligation under the Port Companies Act to act as a successful business, leaving plenty of scope for commercial-political tension. One of the biggest issues is likely to be when the ports company moves aside for development.

Lee said it was in no one's interest to repeat the "farcical transaction" that occurred last May with the sale by international tender of Westhaven Marina, along with the Hobson West Marina, to Auckland City Council for $54 million.

On that occasion, a legal opinion from constitutional expert Sir Geoffrey Palmer confirmed that the ports company owned the marina and the council would have to pay "market rates" to secure the asset.

In March last year, ports chief executive Geoff Vazey said the company had made no decision "in the short or long term" to sell $400 million of assets from Queens Wharf to the harbour wharf, earmarked by Auckland City for development.

Vazey said then that several properties on the council's wish list were working wharves, such as the tank farm and Queens Wharf.

Auckland City Mayor Dick Hubbard welcomed the takeover bid, calling it "a window of opportunity" to get the interface between the city and the water right. He wanted Auckland City "more involved" in the ownership of waterfront land.

Former Infrastructure Auckland chairman John Robertson, now Mayor of Papakura, slated ARH for tying up a further $170 million of public money in the ports company. "This capital was destined to fix up Auckland's transport and stormwater systems."

He said the statement that ports land would remain in public ownership was a clear intent to interfere in the operations of the ports company.

THE HISTORY

1988: Ports of Auckland formed as part of ports privatisation.80 per cent of shares were given to the Auckland Regional Services Trust (it later became Infrastructure Auckland) and 20 per cent to the Waikato Regional Council.

1992: Waikato Regional Council sold shareholding to create listing on the stock exchange.

May 2004: Ports of Auckland sells Westhaven Marina and Hobson West Marina for $53 million to Auckland City Council.

July 2004: Infrastructure Auckland assets transferred to Auckland Regional Holdings.

April 2005: ARH launches full takeover bid.