Over-rated

Gerry Brownlee said it was disappointing a “democratic process can potentially be subverted by this sort of activity”.

That’s Brownlee talking about the Greens fiddling with submissions to ECan. It is deeply ironic that the Minister, or anyone in the National party, can try and take the moral high ground on democratic issues relating to ECan, the regional council which they sacked in 2010, promising new elections in 2013. Then in 2012, using the excuse of the earthquakes, they extended the commissioners remit through till 2016. If they are re-elected, there is no guarantee that they will return the mandate to the people who pay their rates to ECan. The only party “subverting” democratic processes at ECan are National.

When he was campaigning in Christchurch last week, John Key said that “elections are over-rated”. That was an incredibly insulting thing for him to say – let alone for him to say it in Christchurch, a city where many in the population feel totally disempowered by the dictatorship at ECan, the sidelining of the City Council, and the frustrating struggle with EQC, a part of the government that was theoretically set up to help all New Zealanders. From my conversations in Ilam and elsewhere, there are many people who will be voting to remove Key and Brownlee – then they won’t have to be bothered with the nuisance of elections any more.

 

At the debate on Tuesday night, the Prime Minister boasted that the rebuild was going well, that the CBD was booming and almost full. On the 4th anniversary of the September 4th quake, I thought I’d take some pics of the CBD I know.

This is where the Christchurch Temperance Society was, the bar I was at about an hour before the quake. It never reopened.

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This is where one of my flats was.

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And another.

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And another.

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Think Christchurch his booming? Talk to the hand mate

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So last night I was in the front row of the audience at the Press leader’s debate between David Cunliffe and John Key. It was an exciting occasion and great to have so many people interested in politics in the Ilam electorate. I went with my parents, my grandmother and my great aunt – the latter who both live in Merivale, but vote very differently! I think watching it in the room is quite different to what happens on the lifestream. Firstly, it was VERY loud. Both the debaters, and the crowd. Key got a warm welcome but DC’s was louder. The two men talked over each other quite a lot, which wasn’t the most satisfying auditory experience.

James at the debate - photo by Patrick Gower (http://i.instagram.com/p/sb7DqFCA5S/)

James at the debate – photo by Patrick Gower (http://i.instagram.com/p/sb7DqFCA5S/)

Key started really angrily, and talked over David a lot. Most questions seemed to be given to Key for 30 seconds, for him to then talk for 90 seconds, then passed on to David for 30 seconds, at which point Key started sniping at him and not allowing him to answer. While I’ve seen some people comment that they thought the (lack of) moderation was fine, it made for a number of occasions where both men just talked over each other, as if the first person to stop talking was less of a man or something. Key’s question about CGT on houses in a trust did seem to catch David, but he was right to check and see. It’s a complicated issue and it’s worth being right on it.

As with the first debate, most of the commentators seemed to make up their minds about “who won” based on the early exchanges. Key was definitely much weaker in the second half. This was because if focussed on Christchurch issues, and National’s record on this is poor. When he announced that Gerry Brownlee would be CERA minister after the election, this was received with boos. There was laughter when he claimed that the CBD was “booming and almost full“. There was confusion when he started telling Press editor Joanna Norris about an advertorial supplement that will appear in the paper next week. And when he said that the government wouldn’t want to “run roughshod” the Anglican church (when talking about the Cathedral) one was reminded of some of the other institutions that this government has run roughshod over – including ECan and the CCC.

Cunliffe spoke well on these matters, as he has done over the last 3 months of the campaign in the city. He knows that Labour’s policy is popular here, as he has been down here to announce it, and has talked with hundreds of residents who are in difficult situation. Instead of just making light of people’s real hardship like the Prime Minister, Cunliffe has showed an empathy that Key lacks. While the media in Auckland and Wellington might have called it one way, the people in Christchurch were only presented with one leader who understands the issues in this city, and it wasn’t the Prime Minister.

The Prime Minister announced today that if re-elected, after the election, he would look to merge CERA into the department of Prime Minister and Cabinet. This is an admission that the CERA model – authoritarian, dictatorial and deaf to the concerns of the people it claims to represent – has failed, and failed absolutely. This is what people in this city have been saying for years. When Labour announced that we would introduce a board of governance, and look to wind CERA down in 2016, National said that CERA was working just fine. Nothing has changed since then, but National know how unpopular CERA and it’s Minister are in this city, and are trying to stop the bleeding of votes.

Given what we have seen from the Prime Minister’s office through the Dirty Politics saga, it is the last place that should be running a city. The last thing Christchurch needs is another layer of bureaucracy in a city on another island. Control of the rebuild needs to be passed back to the people, by strengthening the role of the CCC.

It also raises questions for Minister Brownlee, who has been given a vote of no confidence from the Prime Minister just weeks out from the election. He’s been in charge of the rebuild for almost 4 years, but has proved to be most effective at demolition, not construction. Many people I meet in the electorate tell me that while they will be voting for National, they can’t bring themselves to vote for Mr Brownlee. It will be calls like that from National’s base that have forced Key’s hand.  But for the PM in his home city, it is too little, too late.

On August 7, the Prime Minister was in town to announce the convention centre plans. This was done in a special marquee that was erected on the site, and to a very select group of delegates. I used an OIA to ask CERA how much hosting this shin-dig cost; almost $16,000. This was an event for around 90 people; this works out at around $170 a head (on the taxpayer). I’m sure Key and Brownlee thought that the convention centre announcement would lead the news. Instead, their trip to Christchurch was derailed by the real hardship that their government is responsible for, as Paulette Barr approached the PM directly with her case.

On the PM’s trip to Barrington Mall last week, he was again approached by a resident at wit’s end. This pattern will repeat each time he visits the city until he does something to address the growing divide between those who have done ok through the quakes, and those who are still battling on a daily basis. Whilst Key and Brownlee eat canapés, there are people in this city living under canopies. Mr Brownlee needs to explain to the public of Ilam and Christchurch how he can justify spending almost $16,000 on a swanky party for him, the PM and a few exclusive guests, to announce a facility that very few residents of this city will ever have a need to use. If Mr Brownlee spent more time in the electorate he represents, he’d know that his constituents don’t care about convention centres: they want their houses fixed, their EQC claims sorted, their rents to stop increasing at double digit rates.

On Morning Report this morning, they went to a very unusual commentator for an opinion on National and Labour’s campaign ads. John Ansell. You may remember John Ansell from the Iwi/Kiwi billboards of 2005 – or you may have tried to purge his backwards, racist view on the world from your memory (recommended). His ideas were too crazy for National, so he went to ACT. His ideas were too crazy for them too. How he ended up on our public broadcaster is a mystery to me. He said a couple of loony things, but this takes the cake:

God is obviously a member of the National Party where [sic] as he um flattened the people’s republic of Christchurch and that created the economic growth that the Nats are now boasting about.

This comes hot on the heels of Cameron Slater calling earthquake victims “scum”. The people of this city deserve more than this. I join in my colleague Clayton Cosgrove’s calls for Prime Minister John Key to condemn these comments while he is in Christchurch today. As Clayton says:

That is absolutely disgraceful and hurtful to all those Cantabrians who have been toughing it out for the last four years … Mr Key may claim Mr Ansell doesn’t have direct links to the National Party anymore, as he does with Mr Slater, but that’s not good enough. John Key must show leadership and condemn the comments. That’s what New Zealanders expect from a Prime Minister.

Meanwhile, the insurance industry are reporting increased profits, and the Insurance Council “hope” to have “most” claims completed by the end of 2016 – 6 years since the first quake! The so-called recovery isn’t delivering for the people who need it most, and the attitudes of those close to the National Party show why they aren’t concerned about changing this any time soon.

 

Just a quick post about Christchurch and the insurance shambles. IAG today reported an increase in profit after tax of 59%, to Australian $1.23B. IAG owns three New Zealand insurance providers – State, AMI and NZI. Here’s how customers ranked those insurers at Insurance Watch:

from insurancewatch.org.nz

Also in the report they said that they have settled 58% of their claims in Christchurch. Of course, the other way of putting that would be that almost 4 years after the first quake, a company that is reporting a 59% increase in after tax profit still hasn’t settled 42% of their claims in the city. 42%! And to be honest, after 4 years, I think that 4.2% would still be too high. People have paid their premiums to these companies for years, for one purpose – to be insured in the event of a disaster. For a company to still have 42% of their claims unsettled, and at the same time, be reporting a 59% increase in profits, shows that the insurance market isn’t working for the people of Christchurch.

This is what can happen when you have your biggest insurer running out of Sydney. Labour would establish KiwiAssure to stop these profits going off-shore. We would also set up an insurance court; it would cost just $1 million to set up, and would speed up the resolution of these claims. The next time you hear the insurance industry criticising these sort of attempts to fix their industry, remember those numbers. 59% increase in profit; 42% of claims unsettled 4 years on.

Last week, Paulette Barr saw the Prime Minister in Riccarton mall and bravely approached him with her story. It was a bleak story, and got plenty of media attention – front page of the Press, story on Campbell Live. A week later, some good news – Barr’s claim has now been “fast-tracked”, and Christchurch Central MP Nicky Wagner has become involved.

While I am happy for Barr – no-one should be going through these situations almost 4 years after the quakes – this story actually makes me more upset. It’s shouldn’t be like this. You shouldn’t have to rely on a chance encounter with the Prime Minister to get any movement on your claim. There are thousands of cases like this in Christchurch right now – how can we get them all “fast-tracked”? On the same day that we get the happy resolution story, we also have this – a homeowner living in a 3 degree house after repeatedly being told different things by EQC.

What we need in Christchurch is an admission the EQC and insurance process for fixing houses is fundamentally broken. We need the Minister of EQC, Gerry Brownlee, to answer questions as to why it has got to this point. Instead of merely patching up cases when they reach the media, the whole culture of these organisations needs to change. Their role is to help people. They shouldn’t have to be guilted into doing so by the media.

I’ve written about the idea of the Convention Centre before, but it seems relevant to do so again given that we now know some of the facts around it. So, to recap:

  • it will be build by a consortium of Carter Group, Ngai Tahu, and Plenary Group
  • the taxpayer will pay $284 million
  • the consortium will pay the remaining $200 million +
  • it will take up most of the area between Victoria Sq and Cathedral Sq
  • it will have a 2000-seat conference facility, hotels, residential development, hospitality and retail outlets
  • the facility will be run by Accor, an international convention centre and hotel chain which has hotels in the CBD (Novotel and Ibis)

Here are some other facts, not considered relevant:

  • the previous Christchurch Convention Centre, which opened in 1997, cost $15m to build and could host 2,250 people
  • the Auckland convention centre, being constructed by SkyCity as part of a controversial deal, will be able to host 3,500 people and is costing $402 million to build. That consists of $87m on land, and $315m for the build and fit out

christchurch-convention-centre-precinct-avon-river-view-letterbox

But probably the most intriguing aspect is the involvement of Plenary Group. Despite claims of a competitive tender process, they appear to have been the only company involved in the tender since earlier this year. They are a mysterious Australian company which specialises in PPPs (public-private partnerships) and have built a number of convention centres in Australia and Canada. Michael West at the Sydney Morning Herald has done some digging to try and find out how they work, with limited success:

The three investment bankers [John O’Rourke, Ray Wilson and Paul Oppenheim] parted way with the Dutch giant ABN Amro in 2004 and set up Plenary Group to invest in, develop and operate privatised assets in partnership with governments … Although a few entities within its burgeoning corporate empire do disclose, Plenary’s ultimate financial position is unknown. A byzantine maze of companies winds to a cul-de-sac: a private trust controlled by the three Plenary principals and associated entities.

Stepping back from any argument around the merits of the convention industry itself, CERA and Gerry Brownlee need to be more forthcoming with the public about the amount of their money that is going into this. Who will ultimately own the facility? Why are the council not going to operate it, as their subsidiary VBase did with the previous centre, and currently do with the Wigram Airforce Museum, which doubles as a conference facility? Given that more than half of the funding is from the public, will more than half of the benefits accrue to the public? How will the taxpayers know whether they have got a good return on their $284 million investment? How come it is going to cost more than 30 times more to build a 2,000 seat facility than it did in 1997? The public of Canterbury, and indeed the whole country, need to see a compelling business case for this convention centre before any money from the public purse is committed to it.

 

The Press ran a feature at the weekend that looked at the City Council’s finances, and the man who has a lot of the responsibility, Raf Manji. Undoubtedly, this is a very complicated subject, but since the release of the Cameron Partners report it has been simplified down to “we have to sell assets.” That’s not the only conclusion that one could reach from reading the report, but it is one that suits the government, who have been trying to sell off council assets since pretty much as soon as the quakes started, almost four years ago. However, John McCrone does go and talk to someone else, Christchurch accountant Cameron Preston. Between the two of them, they do a good job of explaining how we got into this situation:

On the infrastructure repairs, the council’s position was that a total of $3.4b of public works was needed to bring Christchurch’s roads and pipes back to their pre-quake level of service. But KordaMentha notes the Government unilaterally capped its “60 per cent” contribution at $1.8b. A maximum figure was named. Once the council’s 40 per cent share was calculated off that, it effectively lopped $400m off the infrastructure budget, bringing the agreed spend back to $3b.

Some 83 road, sewer and water projects got axed from the council’s priority list to make this work.

However, now – because the money actually does need to be spent says the council – the missing millions have just reappeared to haunt the accounts as the largest part of its $800m balance sheet black hole.

So $400 million went missing from the infrastructure budget from the start, and everyone knew that it was needed. The government knew it was needed, and knew that there was no room in the CCC’s budget. They knew that if the CCC were to act responsibly, they would have to find this $400 million, and that in doing so, this would create a “black hole” and a “crisis”. Then the pressure goes on the council, and the “sensible heads” like Manji to do the “reasonable thing” and sell assets. Job done. The $400 million to raise from asset sales is suspiciously similar to the $400 million that went missing from the infrastructure budget in the cost sharing agreement.

Brownlee, Parker and Joyce, put the final touches on burying the council

the government and council in happier times

But what about the other $400 million in the council’s $800 million block hole, you might ask? Well, you might like to consider some other items that were forced upon the council in the cost-sharing agreement. $253 million for a stadium (a project that will be controlled by the Crown, not the council that is paying for it). $147 million for the Metro Sports Centre – another council-funded, Crown-controlled asset. And funnily enough, that’s $400 million right there.

This isn’t a crisis; it’s a bait and switch. The government has skimped on infrastructure, and then forced the council to spend money on assets with weak or non-existent business cases. They’ve forced the council into a corner, and are now trying to tell us the only way out is asset sales. It’s not. They’ve trimmed money from the rebuild budget so that they could make their surplus, and then turn around and say they can afford to spend $300 million on a behemoth of a conference centre.

This “crisis” is a key example of just how this government are running the rebuild, and a strong signal of how they plan to continue if given another term. We can’t afford another 3 years like this. Every vote for Labour in Christchurch is a vote that says that we want an inclusive, people-focussed recovery; every vote for me in Ilam sends a signal to John Key that the rebuild isn’t working.

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