Council stakes in Auckland Airport

Alasdair Thompson writes in the Herald:

Auckland Airport is issuing more shares to fund its purchase of airport company shares in Cairns and Mackay, Australia, and the mayors of Manukau and Auckland say their councils will use ratepayers’ money ($28.66 million) to buy their extra allocation of them.

This means that every ratepayer in Auckland and Manukau has been forced to fund a speculative investment in two Australian Airports. Madness.

I asked Mr Brown about this recently, and his answer was he wants Manukau city to control the airports shareholding because it’s a “strategic” asset. He quoted a former Manukau mayor, who apparently used to say “it’s a licence to print money”. He made no attempt to compare the return on his ratepayers’ investment in the airport with the returns or benefits from investing in risk free core public infrastructure.

John Banks agrees with Mr Brown. He too wants his council to buy more shares in the airport to keep its level of control over the airport’s ownership. Mr Brown’s subtext was that most of the people who will vote for him like public ownership of businesses such as airports and ports and don’t like private ownership of them.

But this is like saying most people don’t like private ownership of businesses, even though it is business that provides the jobs, products and services, and dividends and taxes that pay for the jobs and services of the public sector. We say that where the private sector is happy to take on risk let it do so and let government regulate monopolies and control of “strategic” assets.

Could not agree more.