Our region is fortunate to publicly own our port and airport. Port Nelson Ltd (PNL), worth about $260m, and Nelson Airport Ltd (NAL), worth $110m, are 50% owned each by the Nelson and Tasman councils. This week, we have announced changes to how they will be governed.
They are core public infrastructure and sit alongside other public enterprises in the region. Nelson Marina Ltd is worth $21m and is 100% owned by Nelson City Council. The Cawthron Institute is worth $40m and owned by a Trust that includes the Mayors as Trustees. Network Tasman Ltd, that recently merged with Nelson Electricity Ltd, is worth $287m and is a consumer-owned Trust of which I am an elected Trustee.
We are indebted to our forebears for their wisdom and effort in creating these entities. The city has a big interest in them being well governed, efficiently run and publicly accountable.
Some port and airport companies have been fully or partially sold in other areas of NZ. The risk with private ownership, particularly where the companies are monopolies, is that to maximise profits they overcharge, provide poor service and under-invest.
Nelson City and Tasman District councils decided in 2023 to establish Infrastructure Holdings Ltd (IHL) for the port and airport to enable it to secure lower-cost debt. This has been successful and generated savings of about $2.5 million since. An interim board structure was set up for IHL.
The two councils have decided to have a single board for PNL, NAL and IHL rather than three boards. It provides clearer governance for management, more direct accountability for councils and reduces costs. We will be recruiting for the new board in the coming months, looking for skilled directors with expertise in ports and airports who want to contribute to our region’s competitiveness and success. The new structure will take effect in January.
Our goal is to ensure they are efficiently run and provide good services. The dividends to Councils are important to offsetting the costs of rates. We also want them to support economic development of the region.
