The government may still be open to putting taxpayer funds towards the building of a national convention centre in Auckland, but the preferred option is for private sector bidder Sky City to stump up the full NZ$350 million required.
Prime Minister John Key told media at his post-Cabinet press conference on Monday that reasons for building the centre, such as the creation of jobs and more guest nights in Auckland, would make the deal "pretty compelling."
“As we know, the deal is unlikely to require taxpayer funds, or us running the convention centre. I think they’re all positives,” Key said.
The government was working hard to make sure the centre presented a good deal for taxpayers, he said.
"It can’t just be a good deal for Sky City. But if that’s the case [that it's also a good deal for taxpayers], then hopefully we’ll get there,” Key said.
“There’s always a range of options, but our preferred option is we don’t have to put taxpayer funds in,” he said.
Asked whether the government would still go ahead with building the centre if taxpayer funds were required, Key replied:
“Let’s wait and see. My preferred option is we don’t have to put taxpayer funds in.”
5 Comments
I'm waiting on Big Tobacco to propose building the Akl rail loop for concessions to sell ciggies in school canteens. I mean, its all about economic growth right?
The abject lack of actually independent analysis on the 'benefits' of this skycity deal is staggering.
Your not going to see that, there is no competitive advantage in it. If they thought they could get away with it though, they might offer to run school canteens for similar concessions.
Sky City of course benefits very directly from this deal, its the kind of thing they might build regardless of getting a sweet deal from the government.
Oh heck - more taxpayer subsidies - but why not, we're good for it - we can borrow the lot!
Wasn't it this government that kicked in for the new Dunedin Stadium? You know, the one that the insolvent local rugby franchise can't afford to play at? The one that because the local rubgy franchise was no longer going to need their old stadium saw the Dunedin ratepayer purchase that old one as well?
The Government's proposal to subsidise the conference centre is totally incompatible with their argument that NZ rail must import railway stock rather than build them at Hillside, because it was marginally cheaper. The former adds nothing of substance to the nations productive capability and provides only low grade employment. The latter would have been a substantially better proposition and would have provided a better product requiring less follow up repair.
Secondly the level of subsidy granted through the pokie concession seems far too high, more line with a 100% subsidy. In fact substantially more than 100%. In New South Wales 1500 pokie machines in casinos in the state of NSW yielded $551 million profit or $367,000 each. http://www.smh.com.au/news/National/Pokie-limits-fail-to-dent-club-prof…
So by proportion Keys proposition of 500 should give an annual profit of $183 million. The conference centre is projected to cost $360 Million, so an annual profit of $36 Million should be more than adequate; infact in the first few years just over break even should be sufficient until the up front costs are amortised . If it requires a subsidy, surely this should only be considered if a very small subsidy is required. If this proposal is so uneconomic that it requires all this help in perpetuity, why are we considering it? (As a business proposition the whole proposal sounds very a bad deal for for the tax payers, if not dodgy. It is hard to believe that an experienced honest businessman would offer this on behalf of the public he serves.)
Thirdly if this Conference centre is so lucrative for Auckland, then the parties who will benefit should provide the capital. It is hard to see how the gamblers will benefit from a Conference Centre. The restaurants, bars, tourist operators etc will be the beneficiaries. Will they subsidise it? I doubt it. So why should anybody else?
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