Wellington City Council decided last week to amend the Long-Term Plan to remove the sale of the airport shares and self-insurance fund. Democracy has spoken and Council is now moving forward to develop another LTP amendment to address our insurance risk due to earthquakes and climate change disasters.

A bottom line for me as we move forward is that we address this insurance challenge without increasing rates further. I also want to assure the public that, as we go through this process, I do not intend to cut projects that are critical for our city’s growth and sustainability. For me, that means protecting our social housing, and continuing funding for water and key climate initiatives.

Over the last two days I have had many conversations with Councillors about the next steps we need to take. Today’s hui with all Councillors was very productive. There is a strong commitment to deal with the challenges before us.

We agreed that we must address our insurance risk. An important step towards this is to reduce our debt consistently over the course of the next ten years so that we achieve $500m of debt headroom in the case of a disaster. We will be working together to identify where these reductions will come from.

The previous proposal to create a self-insurance fund was also widely supported by Councillors, even if the sale of airport shares was not.

There was a shared commitment for the Council to investigate the sale of ground leases and carbon credit holdings to form the basis of a fund (or other insurance mechanism) that can offer both returns and form of self-insurance to Council and would grow over time. It would be a vital step towards a long-term solution to our insurance risk.

None of the decisions ahead of us are easy, but a majority of Councillors and Pouiwi support this approach and are committed to doing what is right for our city.

I am looking forward to discussing this with the Minister tomorrow.

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