Call to oppose sell-down of Napier Port shares
Wairoa Star, Wairoa East Coast by STUART NASH 23 Mar 2017
FOR those travelling to Napier next week you will see around the city a number of hoardings that read “Napier Port not for sale” (and I will put up a couple in Wairoa when in town the following week).
So why is this important? First of all the Port of Napier is owned by the Hawke’s Bay Regional Council: i.e. you and me.
It is a hugely profitable piece of infrastructure that has been in community ownership since it was built over a century ago.
When asked about a possible sell-down of shares in the port, the chairman of the port’s board and the chairman of the Hawke’s Bay Regional Council have both come out with weasel words stating that they are “considering all options” and “would not rule anything out”.
When politicians and businessmen use such words, we should all be concerned.
Why this has suddenly become topical is because the port is actually growing at a great rate of knots and so needs to expand.
The cost of this expansion is around $100 million.
Sounds like a lot of money – and it is – but the port has the ability to fund this out of cash flow and reserves.
In order to do this, however, it may need to scale back the $7 million annual dividend that it pays to the HBRC.
Ordinarily, this wouldn’t be too much of a problem, as the HBRC could keep rates down by spending a bit more of its cash reserves until the profitability of the port once again increased and the dividend grew to well beyond the current level.
Unfortunately, this is not an ordinary situation because the HBRC wants to spend around d $85 million of our money on a dam in Central e Hawke’s Bay (they have already spend around $20 million of our money and not a sod has been turned) and they need money from the port for this.
Already the HBRC has sold the income from Napier’s residential leasehold land to ACC for 50 years (while still maintaining the management costs) for a paltry $35 million.
I did a simple back-of-the-envelope calculation using conservative inflation and property price e increases and I think that by selling this major e asset (that was returning around $1.7 million/ annual) the council undersold by around $100 million.
So don’t be fooled into thinking that a sale of Napier Port shares doesn’t affect Wairoa, because it affects you as much as anyone across the region.
I will have these billboards up until the chairmen of both the port and the HBRC come out and unequivocally rule out any sale of any stake in the port.
Until then, I urge you to seek a commitment from d Fenton Wilson, your HBRC councillor, that he will never vote to sell down this vital community asset.