Local Govt | National News Video | Parliament Headlines | Politics Headlines | Search


Council should not get into the internet business

Council should not get into the internet business

Council should not invest $75,000 for a 10% share in a new internet company, said Porirua City Councillor Robert Shaw.

For the first time ever the Porirua City Council will invest in a company and appoint a company director.

This is a significant new policy direction for the Council.

The Porirua City Council will not be able to decide how its $75,000 is spent or the objectives of the company.

Section 131 (1) of the Companies Act says the directors must act in the best interests of the company.

A director cannot act in the best interests of Porirua City ratepayers or businesses.

Council is naive when it comes to business and thinks it can influence the company because it has appointed a director and invested money.

Council will participate in any dividends issued from profits.

But, it is more likely the company will come back to the council for more capital.

The paid up capital is believed to be $675,000.

The Company is Smarlinx3 which is based in the Hutt Valley and hopes to provide internet network services in competition with NZ Wireless, Telstra and Telecom.

The Upper Hutt City Council and the Hutt City Council will also be shareholders and it is expected the focus of the work will be in the Hutt Valley.

Cr Shaw said "the ratepayers' money should not be used to compete with the private sector in the internet business which is already highly competitive".

"The goal of subsidizing broadband throughout Porirua City is worthwhile, but establishing a company is not the way to proceed".

"I understand the company intends to help a small number of existing businesses that want greater broadband capacity at cheaper rates" Cr Shaw said.

He said Porirua City would be better served by a scheme to subsidize broadband throughout our City using wireless technology.

According to the Ministry of Education, all Porirua schools have broadband access already.

"I would support the $75,000 going to Business Porirua, so they could improve the situation for all businesses and households."

The way to do this is through wireless technology, and the ratepayers' money could be used to support the link between Porirua and Wellington, he suggested.

Since the company Sartlinx3 was brought to the attention of the Porirua City Council, wireless technology has been introduced to provide broadband to the whole of the Hutt Valley.

The cost of a similar facility in Porirua City has been estimated by industry sources to be much less than the $75,000 now being spent to establish a company. The main cost is the link back to Wellington.

"The ratepayers' money should be used for basic infrastructure not company overheads" Cr Shaw added.


© Scoop Media

Parliament Headlines | Politics Headlines | Regional Headlines


Breed Laws Don’t Work: Vets On New National Dog Control Plan

It is pleasing therefore to see Louise Upston Associate Minister for Local Government calling for a comprehensive solution... However, relying on breed specific laws to manage dog aggression will not work. More>>


Corrections Corrected: Supreme Court Rules On Release Dates

Corrections has always followed the lawful rulings of the Court in its calculation of sentence release dates. On four previous occasions, the Court of Appeal had upheld Corrections’ practices in calculating pre-sentence detention. More>>


Not Waiting On Select Committee: Green Party Releases Medically-Assisted Dying Policy

“Adults with a terminal illness should have the right to choose a medically assisted death,” Green Party health spokesperson Kevin Hague said. “The Green Party does not support extending assisted dying to people who aren't terminally ill because we can’t be confident that this won't further marginalise the lives of people with disabilities." More>>


General Election Review: Changes To Electoral Act Introduced

More effective systems in polling places and earlier counting of advanced votes are on their way through proposed changes to our electoral laws, Justice Minister Amy Adams says. More>>

Gordon Campbell: On Our Posturing At The UN

In New York, Key basically took an old May 2 Washington Post article written by Barack Obama, recycled it back to the Americans, and still scored headlines here at home… We’ve had a double serving of this kind of comfort food. More>>


Treaty Settlements: Bills Delayed As NZ First Pulls Support

Ngāruahine, Te Atiawa and Taranaki are reeling today as they learnt that the third and final readings of each Iwi’s Historical Treaty Settlement Bills scheduled for this Friday, have been put in jeopardy by the actions of NZ First. More>>


Gordon Campbell: On The Damage De-Regulation Is Doing To Fisheries And Education, Plus Kate Tempest

Our faith in the benign workings of the market – and of the light-handed regulation that goes with it – has had a body count. Back in 1992, the free market friendly Health Safety and Employment Act gutted the labour inspectorate and turned forestry, mining and other workplace sites into death traps, long before the Pike River disaster. More>>

Get More From Scoop



Search Scoop  
Powered by Vodafone
NZ independent news