Estimates Debate — Vote Canterbury Earthquake Recovery

New Zealand First does not underestimate the magnitude of the issues facing New Zealand over the Canterbury earthquakes. We acknowledge the efforts made so far by the Government to address these, but we do have a duty to highlight what we see as the Budget inadequacies of those efforts.

Firstly, regarding the new central city plan, it is of course the people’s plan, not the Government’s plan. It was based on submissions by Christchurch people and the employment of local architects and others. It is conceptually sound. The use of a green “frame”, the emphasis on the Avon River, and anchor projects are well identified. But all this is very expensive to implement. It is all very well to dream up a vision; it is another thing to see how it might be implemented. Private insurance and Earthquake Commission contributions will be very substantial, but council insurance is completely inadequate. Additional council investment in the plan will mean a large burden to meet all demands.

Additional Government investment is required over and above the land purchase requirements. It is not good enough to leave the Christchurch ratepayers to foot the bill alone. That would require excessive borrowing beyond prudential limits by the council. It is also likely to so pressure the council and community that unwise and short-term decisions might be made. Christchurch deserves better from the Government. The whole country has an essential stake in Christchurch’s success and early recovery. Without additional Government investment, the risk is that the rebuild will take far too long to achieve the building of the major anchor projects, especially the convention centre, the stadium, and the sports facility in particular.

What is not an option would be Government pressure to sell the city’s strategic assets, especially airport shares, port company shares, and Orion shares. They deliver a dividend stream far exceeding the cost of borrowing: 15.2 percent on average recently, versus under 5 percent. They also underpin the city’s asset base, which enables borrowing on advantageous terms. I have had decades of experience serving on the boards of some of these companies, and I am certain that the sale of any part of the shares in them would weaken the city’s recovery and would not enhance it at all. To do so would be only a band-aid fix, and what we need is long-term recovery.

So what should the Government’s priorities be? Firstly, to ensure that the residential areas are fixed very soon—that is the first priority—then to assist the city council in the overwhelming burden it faces concerning the central city recovery. Firstly, it should actually invest adequately in the major projects indicated in the plan, such as the convention centre, the stadium, and the sports facility. Secondly, of course, it should ensure that basic infrastructure is quickly repaired—and that is happening far too slowly currently, if you look at the performance, especially that of New Zealand Transport Agency. The third priority would be to fast track the replacement of major Government buildings—courts, police, administration offices, and so on. That also needs a boost. So the Government’s provision for these purposes, I think, is completely inadequate.

The Government often talks up the Christchurch recovery as one of its main priorities. But I question its actual commitment to dealing with those priorities, for the reasons I have just given. But that is not all. There are other issues, and one of them is insurance. It is still too hard to get. Insurance companies are still acting far too slowly—some quite deliberately, I think. And it is not enough for the Minister for Canterbury Earthquake Recovery just to talk tough about this. We need some funding support too. The funding would be used for issues such as a decent disputes resolution process that is able to take classes of issues for resolution and to ensure practical results for people, and that is not happening currently. In addition, long term we need to reassess the whole regime of disaster insurance, the place of the Earthquake Commission, and the need—we in New Zealand First think—for a State-operated New Zealand insurance company to ensure availability of cover on fair terms and to be more responsive in a large-scale disaster.

I would like to go on and talk about the white zone, because there we have similar issues. Delays so far taken are excessive—acknowledging the technical issues involved. The issue here is also who pays for remediation actions. Uncertainty causes failure to act, especially, for example, with rockfall fencing. I know of one area near me in Sumnervale where people are very worried by the fact that the council originally decided to put up rockfall fencing because it thought that it was going to be paid for by—shared between—the Government and the council. When the council found out that that is not likely to be the case, it suddenly decided that it would not put such fencing up any more. Of course, this is a serious safety issue. The Government needs to take its fair share of that sort of burden to make sure that those safety issues are dealt with.

When we come to resources generally for the rebuild, with homes progress is still far too slow. Yes, thousands of homes have been repaired, but there are tens of thousands still to go. Fletcher EQR is the sole manager. We in New Zealand First think that what we need is at least one other manager, to ensure competition. That would allow a cross-comparison of the performance of the two and would increase the management resource available, and in those ways would speed up, we think, the progress with the repair of homes.

Similar issues apply to the business rebuild. We think there needs to be a 5-year target for the central city for people to focus on for investment. They need incentives. They need rates holidays, tax holidays, and fees exemptions. We see none of those sorts of incentives in this Budget, which is silent on those obvious needs.

When we come to red-zone purchases, yes, there has been good progress made, and that is good to see. But our concern is for people trapped by red-zone land decisions, because in too many cases the sale price is not enough for a new home, and no other funds or mortgage are available to many people. New Zealand First calls again on the Government to ensure there is bridging finance for people in this position of up to $100,000 at zero interest, repayable upon sale or upon death. That sort of provision would help people who are trapped in the red zone because they cannot afford a new home with the proceeds of sale to move on.

Those are the sorts of practical provisions that New Zealand First wants to see implemented. Again, we are not seeing any good, practical policies of that kind included in this Budget. So it is not good enough to hear Government members constantly say that one of their top priorities is the Christchurch rebuild and recovery, when there is a complete failure to address so many of these issues and to make a real commitment in the Budget to see that those things are done.

I was at an announcement on Monday, hearing the Minister talk about the new central city plan, and it was good to hear it—there is a lot of good stuff there—but he did mention that there would be billions of dollars more required. But there were no details, no serious commitment, and no indication of where that money would be spent and what it would be spent on.

What we in Christchurch want to know is what those priorities are. How will people in their homes find that their repair programme can be sped up? How will people with businesses in the central city know that there is going to be not just a plan but actually a financial commitment from the Government, beyond just land purchases, to ensure that that plan gets implemented? Those are the sorts of issues that we do not hear about from the Government and are not provided for in the Budget. We in New Zealand First do not think that is a good enough commitment whatsoever. Much more needs to be done, and there needs to be more investment in the Christchurch recovery than we have heard so far.

Finally, I want to repeat this: any expectation that the Christchurch City Council can borrow its way out of these difficulties is a myth, and any expectation that Christchurch people will commit their valuable strategic assets is also a myth.

I am pleased to take a call on the estimates for Vote Canterbury Earthquake Recovery—that is, CERA, or the Canterbury Earthquake Recovery Authority. It is a highly important part of Christchurch and Canterbury. Although it was established only in March 2011, the Canterbury Earthquake Recovery Authority has overseen an enormous amount of activity in the last year and has a huge amount of work to look forward to supervising in the next year.

I just want to take up what Denis O’Rourke was talking about. This Budget covers the cost of running the Canterbury Earthquake Recovery Authority, and it is for it to work in partnership with the three local councils and to plan and administer the recovery. But, of course, it does not cover the cost of the overall recovery or rebuild, which Treasury actually estimates at over $20 billion; many believe that it is going to cost even more than that. The appropriation for this Budget in 2012-13 is $90.653 million.

I would just like to pay credit to Roger Sutton and his team for the excellent work that they have done in the time they have been there, under really difficult circumstances. This cost is much less now simply because of the work that has been done in the past. The last 22 months have been a time of great uncertainty for Cantabrians, because we have had thousands of earthquakes—over 11,000—and with those earthquakes have been many accompanying challenges, and they have come in waves. But I think we are making some real progress. When I say the appropriation for the Canterbury Earthquake Recovery Authority is significantly less this year, it is because so much has been paid out in 2011-12. The majority of the red zone residents have been paid out. I think over 6,000 people in the red zone have settled, and 5,000 of those have been paid out.

There has also been over $1 billion of work done in terms of infrastructure. That is the repair work for roads, for waterworks, for pipes, for sewers—the things that you do not see, but the things that are incredibly important. That work is being done by SCIRT, which is the Stronger Christchurch Infrastructure Rebuild Team, of which the Canterbury Earthquake Recovery Authority is a participant. As Denis O’Rourke mentioned, thousands of houses have been repaired. About 20,000 have been repaired and people have gone back into them. That is more houses than there are in Timaru, but, of course, there is still a lot more to do. They are saying that probably about another 40,000 have work to be done on them. There has also been quite a lot of work done in terms of preparing land for subdivision, and people are beginning to be able to move out of their houses and onto new land. Of course, there are many more huge challenges in front of us and a huge amount of work to do.

I would just also like to reflect on what happened this week when the CCDU, which is the Christchurch Central Development Unit, announced its blueprint for Christchurch. That blueprint was developed with the Christchurch City Council and Ngāi Tahu. It was launched on Monday night, and I think it was really impressive. In fact, I think it was brilliant. Again, I would like to give credit to Warrick Isaacs and his team, who have worked long and hard to get that 100-day plan out there. It is inspirational, it is innovative, and it is going to create what looks like a very people-friendly and environmentally friendly city. The good thing about this is that it really builds on the ideas that have come from the people of Christchurch. The city council developed its Share an Idea campaign, and 106,000 submissions were put in by the ordinary people of Christchurch to go towards the development of this plan. I think the blueprint really delivers on their vision that came out of that project, which was for a garden in the city.

Sitting suspended from 6 p.m. to 7.30 p.m.

Before the dinner break, I was talking about the new blueprint, the 100-day plan for Christchurch, and how well it has been received, how it is inspirational and innovative, and how I would like to congratulate the team of Warwick Isaacs and his people, who have worked so long and hard to get this result. The blueprint identifies a dozen or so exciting anchor projects for the city. They will provide real amenities for local residents, for the Greater Christchurch area, and also for tourists. [Bell rung] But the beauty of this new plan—

The CHAIRPERSON (Eric Roy): Order! The bell may not be very loud.

Mr Chair.

The CHAIRPERSON (Eric Roy): Are you seeking another call?

Yes please, Mr Chair.

The CHAIRPERSON (Eric Roy): Well, you must do that the moment the bell rings.

Thank you, Mr Chair. The beauty of this new plan is that it will build a more compact, well-designed, and, we hope, people-friendly and environmentally friendly city. I really like the idea of the green “frame” and the fact that the River Avon runs through the city, and that will be a focus. It will be a focus for walking, for sitting, for biking, for just enjoying the outdoors on the two sides of our city, and on the other two sides we will have this large green space. I think that that is going to make our city something that we will all be proud of.

It is also a compact city, so near the Square you will have the convention centre and that will open up into Cathedral Square and Victoria Square. We will also have the theatre complex very close to it, and on the other side of the retail area we will have the new justice and emergency services centre and also the bus exchange. Past that we are going to have the innovation centre, which is based around the Christchurch Polytechnic Institute of Technology, where young people will want to go. But the whole key here is that the whole city will be very walkable and will be a place that people will want to hang out in and spend some time there.

It is particularly important that this city plan works well. There has been some debate in the community that we should really be focusing on the residential areas before we focus on the central business district, and I agree with that—it is really important that people are in homes that are warm and safe—but the problem is that unless we get this central business district up and running, we lose the attraction of our centre city. Not only do we have to be responsible to our local citizens and the Greater Christchurch area, but also we have to be responsible to the South Island, because Christchurch is the gateway to the South Island. We need to have a vibrant city that will attract tourists, so that they not only will come to Christchurch, but will feed out through Christchurch, right around the South Island. We have seen a drop-off in tourism in the rest of the South Island because Christchurch has been damaged.

I think this exciting, new-look city will bring people back to the centre. Christchurch people have been amazingly resilient. It is hard to believe that before the earthquake 63,000 people worked within the four avenues and there were 10,000 people living there. All those 63,000 people have found another place to work, and gradually over the next few months and years they will be able to come back to the city.

I also just want to focus on the residents within the four avenues for a few minutes, because that is where I live. Before the earthquake, there were 10,000 people living within the four avenues. Of course, that was immediately shut down after the quake in February. We had the police and the army at the end of the four avenues, and nobody could go in and out. Many people had to leave their homes and could not get back to them. Some of the people who lived in the centre, which is still under the red cordon, never got back to their homes and could not even get their possessions out of them. So the people who live in the centre city have had a pretty long row to hoe. We have also got quite a large red zone around the Avon River and we have got plenty of technical category 3 land. So it is really good that the people who live there—and I think there are probably only about 5,000 of that original 10,000 left—have got these new things to look forward to and can use the amenities. The amenities are cleverly planned so that we will bring people into the city and they will be able to work there, to play there, and to enjoy our new city.

Overall, I would like to thank the Canterbury Earthquake Recovery Authority for all the work it has done. I know it has been a really tough time. I know the authority has been challenged, but it has managed to bring in a large number of really skilled, professional people who have got through the work that had to be done. They have come up with innovative solutions in terms of the Stronger Christchurch Infrastructure Rebuild Team and also the Christchurch Central Development Unit with the 100-day plan. They have dealt with these issues creatively, they have been innovative, and I think they have come up with good results. I think that there is no doubt that the people of Christchurch will and can rebuild a stronger, better, more beautiful city. Thank you.

I am pleased to take a call on schedule 1 of the Appropriation (2012/13 Estimates) Bill. Vote Canterbury Earthquake Recovery totals over $90 million. As the Finance and Expenditure Committee report notes, this is a substantial reduction on previous appropriations, as most of the demolition costs and purchases of the red zone properties were funded over the past 2 years. But $42.5 million of that $90 million is funding to support the Canterbury Earthquake Recovery Authority in planning and facilitating the city’s recovery and for policy advice. Quite a chunk of that money in last year’s appropriation has obviously gone into the blueprint document, which was released earlier this week.

I would like to congratulate the Minister for Canterbury Earthquake Recovery and the Christchurch Central Development Unit team of the Canterbury Earthquake Recovery Authority on many of the concepts that are in that blueprint. The “frame” on the south and east of the city to contain a much more compact central core is a very good idea, as is the potential for more intensive residential development in that area to make Christchurch a more compact city and to reduce urban sprawl. The Ōtākaro Avon River park is narrower than some of us would like it at the moment, but that is a welcome concept, as is the proposal to improve water quality in the river. There is very welcome recognition of Ngāi Tahu and its heritage in Ōtautahi. So, certainly, the team deserves congratulations on the hard work that it has put in.

But one of the key principles in the recovery plan is to listen to the people—whakarongo ki te tangata. That is based on the very innovative consultation exercise that the city council did in Share an Idea. So the Canterbury Earthquake Recovery Authority needs to continue that theme of listening to the people. People in Christchurch have a strong voice. They want it to be one that the authority listens to not just in developing the recovery plan but also in implementing it. Where concerns have arisen have been in the authority’s very hasty demolition of a number of heritage buildings—the way in which it issues notices under section 38(4) of the Canterbury Earthquake Recovery Act. That needs to be followed up. We need a recovery strategy for heritage. It is supposed to have been produced, but has not been. Then there is the issue of the public being shut out of decisions around heritage buildings. But there is also a concern that the public is likely to be shut out of decisions around buildings and facilities in the heart of the city. The recovery plan provides that where buildings breach the development standards in the plan in relation to matters that are quite fundamental for the amenity of the city, like recession planes and the amount of sunlight, those resource consents are restricted only to discretionary, non-notified activities, so there will not be a chance for public input.

Another key issue is that several of the civic facilities that are proposed in the authority’s blueprint are much bigger and more expensive, potentially, than those proposed by the Christchurch City Council in its annual plan and long-term plan. So that raises the fundamental issue of who is going to make the decisions on the affordability and the scale of some of these civic facilities—the city council or the Canterbury Earthquake Recovery Authority and the Government? The Christchurch City Council’s long-term plan provides, for example, for a 21,000 - square metre convention centre, at a cost of $205 million plus inflation, but the blueprint provides for a bigger facility of 24,000 - square metres. The Christchurch City Council, in its plan, has a preference for retaining the iconic Christchurch Town Hall and the outstanding acoustic qualities of the auditorium in the town hall. Yet the blueprint maps show that the town hall is demolished and that area is completely green. So the Christchurch City Council and the people of Christchurch need to have a say in the funding of these facilities and whether we are going to get the big, shiny facilities proposed in the blueprint, or something that is more affordable. Today’s Press reports that there have been discussions between the Christchurch City Council staff and the Canterbury Earthquake Recovery Authority about the council contributing another $155 million for new projects in the central city. That would bring the council’s contribution to more than $787 million. I assume that the Minister for Canterbury Earthquake Recovery and the Canterbury Earthquake Recovery Authority will encourage the councillors, on behalf of the people of Christchurch, to decide whether that $155 million should be provided—

Vote agreed to.

Vote Transport