Government should underwrite $40m Eden Park shortfall – NOT residential ratepayers

There is no justification for the Government’s decision not to fund the $40 million shortfall for the Eden Park upgrade.

There is even less justification in the demand that Auckland ratepayers should fund the $40 million.

The Eden Park redevelopment Board says it will raise the money eventually from sponsorship – presumably after the Rugby World Cup is over.

All that is needed, the Board says, is a loan, or a loan guarantee, to ensure that the revamped stadium is ready for RWC 2011.

Such promises of future repayment may come to fruition in time – but, if they don’t, any loan guarantor would be required to repay.

If that loan guarantor is an Auckland local authority [such as the new Auckland Council] it is ratepayers who will have to cough up.

This is a commercial risk that should not be borne by residential ratepayers.

Central Government is in a far better position to underwrite this $40 million shortfall than residential ratepayers – many of whom are on fixed incomes, and who are already facing an increase in rates this year, plus a rise in the GST they pay on their council rates.

If the government has confidence that a loan to cover the shortfall will be repaid then the government should have the confidence to underwrite such a loan.

Or is the true situation that the government does not believe that the shortfall will be repaid from future sponsorship – and this is government’s way of forcing Auckland ratepayers to pay the $40 million?

The current Mayors should reject this demand and tell the government to find another solution.

Auckland’s ratepayers are already paying substantially to the infrastructure costs of RWC 2011 – they should not be forced to pay for upgrading Eden Park.

Why not charge a special levy on the increased profits likely to accumulate to the tourism and hospitality industries – or even a bed tax?

Other countries do it. Why not New Zealand.?

ENDS

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