The Government has no plans to buy 50 per cent of the Ports of Auckland, Transport Minister Phil Twyford says.
"This is not Auckland Council policy. It is an idea by one councillor," a spokesperson
for Twyford said of senior councillor Chris Darby's proposal for the Government to buy a stake to release capital for the port's cash-strapped Auckland Council owner.
"The Government has received the proposal but there have been no talks between Government ministers and the Auckland Council about this idea."
The minister had an informal conversation with Darby about his idea, the spokesperson said.
Darby, who chairs the council's planning committee, has been approached for comment.
He recently sent his proposal to several Cabinet ministers, including Finance Minister Grant Robertson, as well as to all councillors and council management.
The first lockdown left a $750m hole in Auckland Council's budget and the city's economy was estimated to have lost $65m a day during the city's level 2 lockdown.
Darby said selling 50 per cent of the port would free up an estimated $1.2 billion to $1.6b for injection into future-ready projects and be more politically feasible than other options.
He got into hot water at the council for floating the idea publicly before formally proposing it to the council, and later apologised.
Darby told the Herald he had since discussed his idea with finance and performance committee chairwoman Desley Simpson.
"...She has assured me all revenue raising options are on the table for discussion.
"This will form part of our examination of information pertaining to the 10-year budget for 2021-2031. I have proposed to councillor Simpson a specific workstream to identify new revenue sources," Darby said.
He told the Herald at the time he wanted to start public discussion on how the council and Government could form a strategic relationship that released capital "to ease the council's financial plight". But it was never a proposal to move port ownership out of public hands.
"I fully understand there are a range of views on the port and port relocation. It's healthy to have a robust contest of ideas. If ever there was a time for that, it's now as we navigate the enormous challenges of the new Covid world we now live in."
Mayor Phil Goff has said Auckland ratepayers might have to be tapped to replace loss of a dividend from the Ports of Auckland if it left city ownership.
The dividend represented a future revenue stream "that would otherwise have to be recouped through rates or via other sources", Goff said in response to Herald questions about the council's Covid 19 emergency budget and whether the council would consider listing the port company on the NZX or a partial sale.
"While the emergency budget provides for the potential sale of up to $224 million of surplus property and land, there is no provision for the sale of strategic assets," said a response from his office.
"Furthermore, any disposal of POAL would require a long-term plan amendment process with public consultations. There are no current plans therefore to list POAL on the NZX.
"Selling shares in the port, even if council wanted to take this step - which it is not planning to do - would make no sense in an environment where the future of the port is unclear.
"Uncertainty would impact heavily on the value of the asset. Additionally, the port normally returns a dividend to council which represents a future revenue stream that would otherwise have to be recouped through rates or via other sources."
Goff's reference to the dividend loss was despite the port's interim results confirmation on March 2 - before the first Covid 19 lockdown - that it would not pay a first-half dividend and expected to pay much smaller than usual dividends until 2022, while it ramped up spending on automating processes.
The port's profit fell to $17.2m in the six months ended December 31, down from $24.4m a year earlier. Revenue was flat at $123.2m.
The port company will release its annual results towards the end of this month.
Auckland Business Chamber chief executive has said local councils, including Auckland's, should be reconsidering ownership of valuable assets like the port.