RNZ
29 November 2023, 12:30 AM
Auckland's mayor is proposing a $3 to 4 billion regional wealth fund, created from the proposed sale of Auckland Airport shares and leasing the port operations.
The Auckland Future Fund would go to public consultation, but Mayor Wayne Brown wanted to be clear: "The port is not for sale, but I do think a temporary lease of its operation is worth considering."
At least $1 billion of the Auckland Future Fund would make provision for climate change risks through self-insurance, saving Auckland Council almost $25 million in annual insurance premiums.
During the current financial year, Auckland Council's property insurance costs have risen more than 44 percent.
Once fully capitalised, the proposed fund would also help mitigate rate rises for Aucklanders by mandating it to achieve a return of at least 7.5 percent, of which the council would receive a minimum cash return of $180 million, or around 6 percent.
This would generate greater non-rates revenue that would help offset rate increases.
Wayne Brown. Photo: RNZ / Felix Walton
Any surplus would be reinvested in the fund to preserve and grow its capital and protect the value of the council's intergenerational assets so they continue to benefit future generations.
The fund would be designated a strategic asset under Auckland Council's Significance and Engagement Policy, protecting it from divestment for short-term gain, but leaving fund managers free to trade.
KiwiRail chief executive Peter Reidy said any potential new port operator would understand the needs of freight companies.
Once the Eastern rail link was complete, KiwiRail planned to double the amount of containers it was able to move from the port, he said.
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