New entity to oversee Whanganui port operations

A revitalised Whanganui Port will be an asset to be proud of, Whanganui Mayor Hamish McDouall hopes. Photo / Bevan Conley

Whanganui District councillors have agreed to create a new council-controlled organisation to develop, operate and maintain Whanganui Port.

It's a condition of receiving $7.5 million from Government to add to the council's $7.3 million and return the port's wharves and buildings to working order.

The yet to be named organisation will be 75 per cent council-owned, with the Government owning the other 25 per cent. The council will contribute $7.3 million plus its Harbour Endowment Portfolio.

That has a value somewhere between $20 million and $25 million, in perpetually renewable land leases, council property manager Leighton Toy said.

The Government's contribution of $7.5 million could be converted to shares later, or it could be handed over to Iwi, councillors heard at Wednesday's meeting.

When the council consulted on creating the new structure in July, it got three submissions. All were critical of the way the port has been run.

One, from Terence Mullins, said the new structure was overly complicated and the port
was "a tremendously expensive white elephant".

"The port needs to be shut down and let nature take its natural course."

Submitter Neil Mills said he hoped those running the port would be experienced and competent. He had worked there from 1977 to 1997.

"The place is a bloody disgrace. It breaks my heart. My heart is still there," he said.

Until now the port's running has been financed by income from the Harbour Endowment properties - about $1.1 million a year or a 5 per cent return, which Toy said was usual for Whanganui.

It hasn't always been enough, with $300,000 from rates needed as well in recent years.

Under the new arrangement, Harbour Endowment money would continue to pay for river and harbour works.

Mills asked why the council couldn't sell Harbour Endowment land to fund the port.

Council legal adviser Rob Goldsbury said the proceeds from any sale had to go back into more property to add to the portfolio.

Borrowing money, at the 1.2 or 1.3 per cent interest rates the council can get, is a good option, council's finance manager Mike Fermor said.

Councillor Rob Vinsen wanted to know if ratepayers would have to pay for any deficit the new organisation incurred, or would Government or an iwi partner be liable for it.

Goldsbury said iwi were taking advice about this and he couldn't predict Government's reaction, but it was usual for both partners to contribute if a partnership needed more capital or had to pay a deficit.

If more capital work was needed and the other partner did not contribute, its shareholding would diminish.

Several councillors said the new organisation was the correct vehicle for the port project.

Without it Whanganui would lose Q-West Boat Builders, and without functioning moles the Whanganui River could shift its course, Mayor Hamish McDouall said.

Councillor Helen Craig was enthusiastic about the project.

"Our business case is very robust. We simply have to invest in the future. Council can't always be penny pinching," she said.

The port was dear to councillor Charlie Anderson.

"The council has got to invest in a dredge sometime in the future. The river needs to be dredged, to keep the wharf operating properly," he said.

Vinsen seconded the motion to establish the new organisation.

"Of course a CCO [council-controlled organisation] is the only practical way of running this asset. The issue really has been whether this development is affordable for the community of Whanganui," he said.