Sunday 19th June, 2011

Q+A interview with Earthquake Recovery Minister, Gerry Brownlee.

Points of interest:
- Estimates 12,000 houses in Christchurch are unrepairable, giving indications of numbers needing to move
- Disputes growing perception that whole Christchurch suburbs will be moved: “ may be the case in some places; it’s more likely to be streets or houses.”
- The building code in Christchurch will be tighter in the future
- Negotiations have been going on all week, and have been continuing over the weekend
- News on what land will be retired expected “sooner rather than later”
- “Insurers are working constructively with us”
- “You can fix the issues in Christchurch for about, uh, round about twice the cost of the Harbour crossing.”
- Brownlee insists last week’s aftershocks have not affected long-term viability of city
- People are still moving to the city, buying houses
- Last week’s quakes make “a couple more residential areas more questionable”
- Most new claims coming from already badly-affected areas, overall very few new claims coming in
- Admits there may be entire suburbs that are abandoned, but in most cases it’s likely to be “streets or houses” deemed unliveable
- Accommodation assistance is available for people if they want it

The interview has been transcribed below. The full length video interviews and panel discussions from this morning’s Q+A can be watched on tvnz.co.nz at, http://tvnz.co.nz/q-and-a-news

Q+A , 9-10am Sundays on TV ONE. Repeats at 9.10pm Sundays, 10.10am and 2.10pm Mondays on TVNZ 7

Q+A is on Facebook, http://www.facebook.com/NZQandA#!/NZQandA and on Twitter, http://twitter.com/#!/NZQandA

GERRY BROWNLEE interviewed by PAUL HOLMES

PAUL The earthquakes in Christchurch continue, with two powerful quakes on Monday toppling more buildings, causing fresh liquefaction – some of the worst liquefaction we’ve seen, not to mention the loss of power, water and sewerage. Since September last year Christchurch people have experienced hundreds of earthquakes, and the predictions are that there are more to come. But it seems Monday’s quakes were the tipping point. Health workers say there are growing numbers of people suffering from anxiety, suffering from depression, and there’s talk of a deep weariness of the soul in Christchurch . The Earthquake Recovery Minister, Gerry Brownlee, is with us in our Wellington studio. Minister, good morning.

GERRY BROWNLEE – Earthquake Recovery Minister
Good morning.

PAUL How badly have the quakes this week affected the long-term viability of Christchurch ?

GERRY Oh, long term, I don’t think they’ve changed things too much, but I think in the immediate aftermath of Monday some of the optimism that was starting to grow in the city has fallen to one side. I hope it’s only for a short period of time. You know, you said we’ve had hundreds of earthquakes; we’ve had over 7500 earthquakes.

PAUL Yeah, but these ones on Monday, they were buggers, weren’t they? The perception in the north, I think, is that certainly hearts got broken in Christchurch .

GERRY Oh, I think so. And, you know, we were on a pretty good track, and I’d published some information in The Press, on a two-page spread on the weekend, last weekend, indicating exactly what was happening with the land assessment, and indicating why it was taking a bit of time. Look, we’ve seriously pulled the stops out since. And I’m here in Wellington this weekend, I’m not normally in a suit, but we are in negotiations that have been going on all week, will continue through the weekend, and moving to, I hope, will be a result sooner rather than later.

PAUL Right. We’re talking about what, days or weeks?

GERRY Look, I’ve steadfastly tried not to put a timeline on it because every time you do it crystallises into a day, and then you get whacked about for not meeting it. In the end, what we’ve got to do is get a clear picture for people on the worst-affected land. But one thing I need to say is we also published last weekend the extent of liquefaction that occurred on the 22nd of February across the city. So, liquefaction alone is not a reason for abandoning land. There are other factors, and they’re all being categorised and measured against individual sections as we speak.

PAUL So what are those other factors, then?

GERRY I think one of the clear issues will be the capacity of that land to hold housing in a safe way. And there is a balance point, too, between what is economic and what’s not. The reality is if you look at cities like Venice and many others around the world, you can build anywhere if you spend enough money doing it. But casting people into that situation is not reasonable.

PAUL So, just briefly, how much progress do you think you’ve made this weekend?

GERRY Oh, I think actually, well before last week we’d made a lot of progress, during the week we’ve made more, and you know, we are very very conscious that people need to have a yes/no answer on their land. And the insurers, I’ve gotta say, too, are working very constructively with us. It’s just as difficult for them: no two insurance policies are the same, and in any street you could have anything up to 12 different insurance policies operating on various houses, so all of that does need to be unpicked a little bit.

PAUL Well, I think, Minister, people do understand there has been massive, massive destruction. Nevertheless, despite all of this, is it time now, really, for us nationally to be asking some very serious questions? For example, let me put it to you this way, without disrespecting you as a Christchurch man or the people in your city: who would go and live in Christchurch now? Who would take a family to live there? Who would go and buy a home in Christchurch now?

GERRY Well, lots of people are. And you need to remember that 80% of the city is completely unaffected by the earthquake damage. We’ve got nearly 200,000 homes inside the city, more than that in the greater Christchurch area. It might be maybe half of them would have some damage, which would range from a little bit of cracking in the Gib board, right through to complete destruction. So yeah, people are coming into the city.

PAUL Well, I know that, we understand that, but of course, one of the features about, um, this whole last year’s seismic activity in Christchurch is we’re finding fault lines we never knew existed. I mean, when it comes to putting your hand in the back of the pocket, I don’t’ know of a NZer who would do so for a home in Christchurch . Isn’t that one of the problems with the long-term viability of your city?

GERRY Well, let me put it to you this way: throughout NZ, you tend to live with your risk. If the probabilities, uh, around seismic activity are considered now, outside of the current event going on in Christchurch, um, there are parts of NZ that have greater risk. Where you’re living, you have a whole lot of volcanoes. People will say they’re extinct – there’s no such thing as an extinct volcano. You’ve got other parts of the country where they are on flood plains, you’ve got parts of the country where you have very very serious liquefaction potential. So in NZ you tend to live with your risk. In Christchurch , we’re gonna know a lot more about our risk.

PAUL Well, you do, but Christchurch — Well, that is right, but in Christchurch you’ve got evidence. In Christchurch you’ve actually got stuff happening. Christchurch is— You’ve got GNS—

GERRY What we’ve got is—

PAUL Sorry, minister. GNS are saying, said last week, there’s a 30% chance of a 6.9 Richter event in the next 12 months. What I’m asking you is how can you seriously commit public funds to the tune of billions when you’ve got that kind of prediction from your own agency?

GERRY Well, we got a 6.3 shortly after that was released, that information was released. And what we observed is – and I think this is a very important point – is that there was an intensification of damage in the most damaged areas; residentially, a couple more areas that become more questionable; but in the CBD, another 100 buildings that were already in trouble put into the ‘complete write-off’ category. So we know that the activity’s occurring in particular places. We also know that inside the CBD there are quite a number of buildings that have survived all of these events, built to a code of 2.2. The code will go up in Christchurch for the future.

PAUL Then, I suppose, there’s the aspect of how much money it’s actually gonna cost us. Are we look at 20 million, are we looking at 30? Do we know? Are we looking at 30 billion, are we looking at 80? And are we gonna get to the point at which the rest of NZ say, ‘Hang on, we can’t spend any more on this.’ Is that a potential problem that you are giving consideration to?

GERRY Well, it won’t be 80. The government’s set aside 5.5 billion in the last Budget. We would expect that will be pretty much the bounds of government expenditure. A further 3.5 coming from EQC, and then an enormous amount – many billions – coming from private insurance And it’s one of the reasons that we need to be respectful of the position that those companies find themselves in. Let me just be clear – you can fix the issues in Christchurch for about, uh, round about twice the cost of the Harbour crossing.

PAUL Well, yes, how much did Monday add to the cost of the repair, do you think, of the rebuild?

GERRY Uh, I think that’s a little hard to quantify. I think what we have been able to assess very very quickly is that in those badly affected suburbs, a lot of houses that might have had 70% to 80% damage have probably gone into the ‘complete write-off’ category, and similarly, you’ll have an escalation. But outside of that, we don’t see too much additional damage, new damage, if you like. There’ll be some, but the claims so far look to be relatively few.

PAUL There is, of course, the human cost.

GERRY Oh yes.

PAUL There’s a perception that, politically, this thing has been drifting. EQC tell us there are 350,000 claims; they’re processing 1500 a week. Our little bit of calculation puts that at about four years before everyone can be processed. Are you putting the resources in?

GERRY We’ve been putting an enormous amount of resource into trying to get all those processes running more quickly. But look, lack of activity – I think if you look at the Fletcher PMO office, hugely beneficial, 6000-plus extra heating appliances in in a very short period of time, as well as emergency repairs. The contracting alliance looking at all of the infrastructure’s been put together, all signed off, and is working. Uh, and you’ve got a huge amount of private insurance assessment going on as well. But I tell you what, we’re in the middle of a seismic event. We’ve had 23, I think – it might be more now – earthquakes over 5 on the Richter scale. And it does throw you back, you do have to have another look, you can’t make mistakes here.

PAUL Um, saying it’s blindingly obvious, but nevertheless, can I ask you this – should people in Bexley and Avonside continue to shovel liquefaction?

GERRY Well, I think if they want to stay in those homes for however long it may be, then yes. And I think the other point is there is a perception growing – and it certainly hasn’t been driven by me – that it is entire suburbs that will go. I think, uh, that may be the case in some places; it’s more likely to be streets or houses. And I think that also presents a bit of a problem. The problem here we’ve got, in essence, is you can’t communicate what you don’t know. And we’re just desperately trying to find out more about the situation for— the land situation; we know what the people situation is, it’s bloody dreadful. But there is accommodation assistance available if people want it; they can move out of badly damaged homes. The insurers are being very cooperative about that. And then over and above that, once that runs out for people who have insurance we have significant government assistance.

PAUL The word is 12,000 homes are doomed. Is that figure impossible? Do you rule that figure out?

GERRY No, I think that’s probably in the realm of that. These are homes that have, um, suffered so much damage it’s uneconomic to repair them. And look, the homes fit into different categories, of course. If you’ve got a million-dollar home with $100,000 or $200,000 worth of damage, it’ll be repaired. If you’ve got a $200,000 home with $150,000 worth of damage, probably it would be a marginal call. But there are many others that just won’t work.

PAUL And finally, Minister, political sources tell us that we could be expecting something Wednesday afternoon in terms of an announcement about the direction we’re gonna be taking for things in Christchurch.

GERRY Well, you’ve got better political sources than I have.

(PAUL CHUCKLES)

GERRY Look, Paul, I think—

PAUL But you said yesterday you were aware of the pressure— you know, you’re aware of the pressure. People are crying out, aren’t they, Minister, in Christchurch , for certainty.

GERRY Paul, I’ve been aware of the pressure since September 4. That’s occupied entirely my life, pretty much, since that time. And, uh, last week, you know, it just sets you back so much. But a lot of progress has been made, we’ve been able to build on the extraordinary amount of information that’s been collected prior to that time, and I want that decision as quickly as possible. But I don’t want to see people being taken out of the frying pan and into the fire. We’re talking about the lifetime equity that most people have accumulated in their homes.

PAUL Minister, thank you very much indeed for your time, and good luck for Christchurch .

GERRY Thank you.

© Scoop Media