Auckland Council debates selling airport shares, Mayor Wayne Brown faces first big leadership test

The Herald understands a group of 10 Auckland councillors opposed to the sale of the airport shares is putting up an amendment to retain the shares, hold household rates at inflation and increase debt.

Mayor Wayne Brown’s proposal to sell the shares has a net cost of $60 million on the council budget - it will cost about $100m in interest costs to hold the shares, offset by a $40m dividend this year.

Under the councillors’ amendment, they would increase debt by $60m to cover the net cost of holding the shares. This would see debt increase from $80m as proposed by Brown, to $140m.

Councillors are meeting today to debate the annual budget and Brown’s desire to sell the council’s Auckland Airport shares, valued at $2.2 billion.

Brown told the meeting they had a “big day ahead of us” and he was hoping for a constructive debate.

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In a late twist mere hours before today’s meeting Albany councillor Wayne Walker declared he is the beneficiary of a $3 million shareholding in Auckland Airport - only hours before councillors vote on a proposal by Mayor Wayne Brown to sell the council’s shareholding in the airport.

Walker confirmed to the Herald this morning that he and family members were beneficiaries of the shares held in the estate of his late father.

Brown told councillors that selling its airport shares was the best option for the council.

“The budget keeps rates affordable in line with inflation, in the context of a cost of living crisis,” he told the meeting.

“I don’t receive any income from the shares,” Walker said, saying he had been working through advice on whether he could vote on the proposed sale of the council’s 18 per cent shareholding, worth $2.2 billion, at today’s meeting.

The meeting is taking place in the Auckland Town Hall and started at 10am.

Walker told the Herald one hour before the start of the meeting that based on advice from the council’s legal team and the Office of the Auditor General he could vote on the share sale today.

He said Brown planned to ask councillors to make a statement at the start of the meeting ahead of the declaration of interests, which takes place at council meetings.

“That is the appropriate thing to do,” said Walker, who confirmed he will make a statement.

Auckland Council chief executive Jim Stabback said Chris Darby and Julie Fairey had received the same advice provided to Walker.

All three councillors are believed to be opposed to the sale of the airport shares and if they choose to vote will make Brown’s job of offloading the shares more difficult.

Auckland councillor Wayne Walker.

Council staff have been looking at all councillors’ and their spouses’ share ownership in case it created a conflict which could prevent councillors from participating in the vote. This has involved discussions with the Office of the Auditor-General.

Two councillors have been forced this week to amend the public record to show that they held a financial interest in Auckland Airport.

Julie Fairey and Chris Darby updated their declarations of interest to show that their spouses held shares in the airport.

Both councillors are believed to be against selling the council’s airport stake. If they were prevented from voting or stood aside because of a conflict of interest, the contest could become much tighter.

‘I think the mayor’s sadly short by one or two [votes]’

Meanwhile Auckland Council expenditure committee chair Maurice Williamson said today he was not sure if the Auckland Airport share sale would go ahead, but he supported it wholeheartedly.

Speaking to Mike Hosking on Newstalk ZB, Williamson said there were a few councillors in the middle who had not made up their minds.

“I think the mayor’s sadly short by one or two [votes], but I can’t say that for a fact.”

Auckland councillor Maurice Williamson says he supports the sale of the Auckland Airport shares. Photo / Brett Phibbs

Williamson said he supported Brown’s budget and that the Mayor had inherited budget issues he didn’t create.

“He’s done a fabulous job,” Williamson said.

The Mayor had reinstated some cuts that were unpopular.

“I think it makes good sense, he’s putting back all those cuts that were making people upset, like the Citizens Advice Bureau and arts.”

Williamson said if only half the airport shares were sold, he thought there would be more cuts and rate increases.

“I don’t want people facing horrific rate increases when it’s not necessary.

“I don’t know where it goes from there.”

Councillors may be asked to consider selling some but not all of the Auckland’s Council’s shares in Auckland Airport today as part of a compromise to get Mayor Wayne Brown’s first budget over the line.

Brown wants to sell the shareholding to help address a $325 million budget shortfall, pay down debt, and keep rates below the rate of inflation.

Deputy Mayor Desley Simpson told the Herald that the council consulted on not selling the shares, selling some of them, and selling all of them.

“Those options still stand,” Simpson said.

Protest group Extinction Rebellion plan to rally at today’s council meeting as part of a coalition against Mayor Wayne Brown’s Budget.

The Stop The Cuts coalition say they are against running down community services, privatising public services and denying the climate crisis.

The group claims Mayor Brown doesn’t have a mandate for his budget cuts because voter turnout in Auckland’s local government election is low.

“We are experiencing the effects of a 1.2 degree post-industrial temperature increase which have brought the January floods, Cyclone Gabrielle, other floods, plus fires and droughts, the group said.

”These are unprecedented but expected.”