Goff mulls Ports of Auckland ownership

Mayor Phil Goff is considering selling Ports of Auckland.

Should Auckland Council sell the port company?

Yes, Auckland needs the money
40%
Yes, but only a partial sale
31%
No, it should remain a public asset
29%
Total votes: 181

Speculation is mounting that Auckland Mayor Phil Goff is considering selling off the Ports of Auckland business.

In a statement, Mr Goff said he has had wide-ranging discussions about the port but no “specific proposal” on the port’s ownership had been presented to him.

“I’ve made no decisions about the port’s long-term future as yet but intend to make progress on this matter over the course of this term.”

Auckland Chamber of Commerce chief executive Michael Barnett tells NBR the mayor’s attitude towards selling the asset has changed since his election.

“I have certainly been made aware over the last couple of weeks that the attitude to recycling assets by the mayor and councillors is probably been given a different perspective from what we have seen in the past,” he says.

“His perspective appears to have changed on what he campaigned on – he was looking at the port and other assets and so on.”

When he was elected in October, Mr Goff pledged to keep the port in ratepayers’ hands as it was the council’s most valuable asset.

Infrastructure NZ chief executive Stephen Selwood told the Herald the business community was supportive of the idea.

"It seems to us silly for the council to be tying up monetary assets and effectively crowding out private sector investment when the money could be better used."

In late 2015, two independent reports from Cameron Partners and EY suggested Auckland Council should consider selling some of its assets to pay for infrastructure needs.

“The council needs to consider whether it really needs to own particular assets to meet its strategic objectives. If full ownership is unnecessary, options include the partial sale and contracting out services,” the Cameron report says.

Both reports suggested the council could lease the Ports of Auckland to a private operator.

A 2013 CBRE report valued the port’s land between $300-600 million.

It made a profit of $83 million in 2015/16, paying $42.2 million in dividends.

The most recent valuation of the port put it at $1.1 billion and is 100% owned though Auckland Council Investments.


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25 Comments & Questions

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Don't you dare sell this Phil!

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Why not? From the above figures, it is worth 1,100m, dividend to Auckland Council of 42.2m giving a return of 3.84% - should do better from a bank

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42.2% return on cost price that's great
$1 in the bank today is still $1 in the bank 10yrs later
$100m purchase now worth 1100m
Sounds pretty good to me

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Wonder whether the OIO will get involved with this stupid notion.

Goff is spinning faster than Donkey did, you have only been in for eight months and already going back on what you stood for.

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"It made a profit of $83 million in 2015/16, paying $42.2 million in dividends."

One of the only profit making assets owned by Council and the consultants are recommending they sell it off.

Talk about short-termism, how about disposing of all the consultants, then there'll be plenty for infrastructure.

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Is this the same Phil Goff who:
- called for a referendum on state owned asset sales in 2011 (and in fact introduced a private members' bill to that effect)?
- said his father would be turning in his grave at the thought of state owned asset sales?
- said "It simply doesn't work. It's just dumb to sell them."?
- was elected on a mandate of not selling the Port?

Phil Goff is another spineless politician who changes his views on a whim to suit his own self-promotion.

What is the economic rationale for selling the Port? The money will just be frittered away by the various incompetent council agencies and hangers on, with little progress being made on the real issue (being that Auckland Council is horribly inefficient and needs to stop blowing ratepayer money on rubbish).

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Too right. I don't for the life of me know why this guy is so popular. I remember watching him on a TV program, going on about how great his electorate was, when he was suddenly cut off from his rant by the interviewer, who then hit him with the words, ah hang on Phil you don't even live in it. It brought the house down with the biggest cheer of the night. To me, the guys just a career politician that's just out for himself. It's a pity Auckland ratepayers can't get better candidates to vote for. Still I suppose that could be said for the country as a whole. Council work seems to attract the salary top-up brigade these days.

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Wow an ex-Labour MP saying something he wouldn't do before an election, and then after elected in, says he may do the opposite. Well who would have thought. Looking at the CBRE report, it looks like a bloody good investment to have. I for one would be keeping it for life. Still I'm looking at it with an investors eyes, not an ex-Labour MPs eyes.

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Honestly Phillip. Toll the motorways instead of giving credence to this nonsense. Ease a small amount of motorway congestion while collecting a potentially large stream of revenue to be put straight back into our much needed transport infrastructure. I can't for the life of me imagine why this possibility isn't being publicly debated at present.

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Already been sold and bought back.
How else can the consultants and brokers make more money out of the suffering ratepayers

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Its not for Goff to sell.
Should be held in trust for future generations

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That would be viable if auckland stopped whinging and got on paying their own way in life.
It's not credible to cry hard up when you have a Cadillac parked in your drive. Get real!!

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Sell the port and how will you stop them extending out into the harbour rather than looking at longer term relocation?

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Becuase they approve or decline the resource consent applications!

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And what has been the history to date Tony? Extensions of Bledisloe Wharf by up to 179m. Opposition to the ACC Future of the Port report looking at options for moving it and the Port of Tauranga to the Firth of Thames or the Manukau harbour. Take a look on their website where they argue the port is part of the "special character" of Auckland!

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Thats because the ACC is currently the owner and the regulator. When the port is operating at 98% capacity, it would be a bit detrimental to the Councils own asset to then refuse expansion to meet demand. It is a business operating in a competitive environment, and not meeting service standards (like during the industrial dispute) is not good for business - because the shipping lines will hapily move down the road to Tauranga (like Maersk).

Much easier for the Council to take a hard stance on expansion if the operating company was owned by someone else.

And to answer your question, the history of port expansion to date has more or less mirrored the history of Auckland to date. More people, more containers, more ships, more container terminals.. pretty logical, isn't it.

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Be interesting to know what rates the council collects from the port and what they would potentially be if the land was developed for uses other than storing empty containers and car imports

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Why on earth should a council own a port? Seems illogical to me.

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It's not the council's, it's the people of Auckland's and we are sick of these idiots just like those in central government flogging off our long term strategic assets because they can't manage their budgets.

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Good point - it is not a stellar reflection on Council management and spending. The potential need to sell off the Ports is akin to selling off capital which you'd rather not do. Perhaps Mr Goff is reluctant to reduce Auckland Council's 10,000 strong staff, and selling port assets is the lesser of two evils? Yes Lord Mayor? Readers await your clarification.

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This is really unnerving as its low brow tactical thinking, not strategic and will have only limited benefits and will weld us further into the existing Port location.

Real solution is to move the Port, sell Eden Park and build a stadium in CBD.
More importantly sell the port Land for housing and green space.
Build new Port either Marsden Cove or Miranda (yes dredging is not a biggie)
Use new Port to anchor a new city to alleviate help strain of population growth in Auckland.
All good stuff plus stops the continued encroachment of the harbour and gets those trucks off the AKL inner city roads and motorways.

Got to be an election winner as will resonate with Right, Left and Green voters.

However just needs Bill English and the Nats to show some serious vision and leadership.... Won't hold my breath.

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Well said. Great plan. Makes real sense. How can we get through to government or local government that they need to ask the ratepayers what they think? Having campaigned on keeping the port, how does the mayor know the public would be overwhelmingly in favour of selling the family silver? That probably means no mandate, and this is a democracy, right? Then treat us with some respect, Mr Goff.

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What next selling of Auckland's water reserves like the West Coast Regional Council, oops sorry wait we do not have any reserves.

Get a grip man.

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Just gut most of the council. Problem solved.

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We should build thousands of council flats on this land. This can be another sign of our success in managing to attract thousands each year from the comparative paradise of third world slums.

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