Tim Dower: Selling Auckland Council's best asset won't fix their deep-rooted problem; themselves

Battle is brewing over those Auckland Airport shares currently owned by Auckland Council. The Council actually inherited 22 percent of the airport when it was formed and since then there's been a capital raising by the airport which has diluted that holding down to 18 percent. But it's worth well over $2 billion; enough to plug that Budget gap six or seven times over. So, the Council's in a bit of a spot. Their choices are either a great big rates increase, or some pretty serious cuts or sell part or all of the family silver. Mayor Wayne Brown wants to flick the shares - and you can see the logic of that. Part of the argument for keeping the shares has been the dividend, but there hasn't been one of those in more than three years, there may be later this year, we'll see. And until recently those shares brought with them seats on the airport's board, which something the Super City chose not to take up, but not an irreversible move if you hold the shares. Now, should local bodies be involved in business activities? By and large, the answer to that is definitely not. They should stick to core public service activities like cleaning the streets, taking away the rubbish, keeping the reserves and parks tidy or fix the stormwater and so on. But I'd argue the airport is core to the functioning of the region. Apart from being a huge employer it's a vital piece of infrastructure and that remaining shareholding, even without seats on the board, could prove crucial one day. Once you sell it, that's it, gone for good - and given the way the Council runs its affairs, that big nest egg will be gone in a couple of years. Selling the shares is a quick but only temporary solution to a long-standing and deep-rooted problem. Auckland Council is that problem. It's over-reaching, hopelessly inefficient, out of control and wasteful. Flicking off its best asset won't fix any of that.See omnystudio.com/listener for privacy information.