Benefits from spending for city soon, says O¯ ta¯karo chiefs
Christchurch is about to see ‘‘sharp, steep growth’’ in benefits from Crown-funded anchor projects after several years of steady spending, a parliamentary select committee has been told.
Facing their select committee review at Parliament this week, the heads of Crown rebuild company O¯ ta¯ karo said they expected financial and social benefits for the city to ramp up over the next four years. O¯ ta¯ karo’s financial report showed the company cost taxpayers $16.3 million to run in its last financial year. This was part of the nearly $150m it spent during the year to June.
The company’s major projects include the convention centre under construction, the metro sports centre, a business case for the planned stadium, the east frame and south frame developments, and some of the accessible city roading programme. It finished the city’s riverside promenade, part of the Avon River precinct, last month and previously completed Rauora Park in the east frame.
The bill for running the company included $10.6m spent on salaries, just under $1.5m on consultants, and $4m on other operating costs including its offices. This financial year the salary bill is expected to climb to $11.6m.
Of the company’s 70 staff, 40 earned in excess of $100,000 in the last financial year. The chief executive was paid between
$580,000 and $589,000, two other staff were paid more than $300,000, and another six were paid more than $200,000.
Board chairman Ross Butler was paid
$70,000 for a year and the three other board members received $35,000 each.
O¯ ta¯karo Ltd was set up under the Public Finance Act in April 2016 to deliver the Crown’s rebuild projects and sell excess land, both with an eye to the city’s regeneration. It has been headed since August by chief executive John Bridgman, a civil engineer with a construction industry background who took over the top O¯ ta¯ karo job from Albert Brantley.
Bridgman told the select committee that while there could be disagreement about some of the cost-benefit figures of the Crown-led anchor projects, their analysis had identified a ‘‘sharp, steep growth in benefit accrual’’ was starting and would last for about four years.
The ‘‘flow-on’’ benefits would be both financial and social and include creating jobs, improving people’s health and wellbeing, boosting property values, and increasing civic pride and confidence levels, he said. Other benefits were likely to include more tourism, increasing knowledge sharing, and a rise in private investment in the city.
The annual review process is the parliamentary committee’s chance to question public sector chief executives about their performance in the past financial year.
The company’s analysis indicates the benefits from the projects to the city would start to level off about 2025.
As of June this year, O¯ ta¯ karo had assets valued at $409.5m with $155.8m worth of equity, the annual report showed.
By the time O¯ ta¯ karo took over control of the Crown aspects of the rebuild from Canterbury Earthquake Recovery Authority in 2016, the anchor projects were already well behind schedule.
Current expected completion dates for the projects are: Convention centre February 2020, metro sports facility October 2021, Avon River precinct December 2019, east frame residential precinct July 2024, accessible city April 2019, south frame October 2021.