Ben­e­fits from spend­ing for city soon, says O¯ ta¯karo chiefs

The Press - - News - Liz McDon­ald liz.mcdon­[email protected]

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.

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