Jessica Mutch interviews Gerry Brownlee

Should be “very encouraged” that insurers have, in general, renewed.

Not considering Government intervention in the area of insurance.

“Very hard” to determine taxpayer’s contribution to the rebuild – “It will be many billions.”

Hopes to see some blueprint projects underway by the end of the year.

On the Cathedral debate, sees the Avon River as the “greatest asset that we’ve got here in the city”.

Q+A, 9-10am Sundays on TV ONE and one hour later on TV ONE plus 1.

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Q+A
 
JESSICA MUTCH INTERVIEWS GERRY BROWNLEE
 
JESSICA MUTCH
Earthquake Recovery Minister Gerry Brownlee, thank you very much for joining us here in the red zone this morning. I want to start off by talking about insurance. You say that you’ve lost patience with insurance companies, saying they’re holding up proceedings. How frustrating is it for you?
 
GERRY BROWNLEE - Earthquake Recovery Minister
I think it’s frustrating for anyone who’s on the end of a claim and is not seeing any movement in those claims. And, yes, I accept there are some reasons for that. You’ve got apportionment arguments, discussions between EQC and the private insurers. You’ve also got some uncertainty that is perceived, at least, around TC3. But for a lot of people, I think there is potential for a greater degree of movement than we are seeing at the present time.
 
JESSICA        What insurance companies are you specifically talking about?
 
GERRY           Well, you know, I’m not going to name names.
 
JESSICA        Why not?
 
GERRY           Because I don’t think that’s helpful. I mean, it’s the old story - if you start blaming, everybody loses. I think what I’m saying is, ‘Come on. As an industry, you’ve got a challenge here which I think has been picked up reasonably well, but we’ve had probably a few too many months not being able to get any clarity about the go-forward,’ and I think that’s the problem at the moment.
 
JESSICA        Is it fair to blame insurance companies? Is EQC to blame here as well?
 
GERRY           Well, I think if you look at the various issues. Let’s talk about apportionment, which is saying, across all of the earthquakes, who picks up what bit of damage on a number of properties. There is a work programme in place, and I’ve been told, really since the start of the year, that we’re about a month away from getting all those issues resolved. And that’s from both EQC and the insurers. And so the bigger party here is in fact the insurers because the biggest liability lies with the EQC. So I would have thought we could have seen a lot more action in that regard. Secondly, when we set out to look at what is the land damage here in Christchurch, the Department of Building and Housing I think very helpfully worked out that there are some areas where you can move very quickly - TC1, TC2 - to get repairs done, to get rebuilds done. TC3, they said that will need a little more work and individual site geotech would be a good idea. I got minutes and said, ‘You’ve got to do better than this.’ You know, surely if there are five houses in a row, and you do two at each end of that row, the three in the middle are going to be pretty much the same. So they’ve been trying to work through a process like that. That was meant to be helpful. We’ve come down with, through DBH, different foundation types that would work for houses in those areas. Insurers could do that individual work if they chose, but they want to be part of a bigger thing. But to do that, I think they have to give a little and accept that you really are only going to be talking about the boundaries of where the technical category 1 and technical category 3 land meet.
 
JESSICA        You gave them a very public serve this week in the media. What were you hoping to achieve out of that? A bit of a hurry up?
 
GERRY           Well, don’t forget that I’m also an electorate MP, and I talk every day to other MPs in Christchurch who share the same frustration. And what we’re getting in our electorate office is all sorts of reasons that people are putting forward from their insurance companies about why nothing is happening. And I guess the latest has been, ‘Well, we’re waiting on the EQC final land report. Well, that was out yesterday, but, frankly, the information in it has been well shared ahead of that time.
 
JESSICA        Do you think that the insurance market is failing Christchurch at the moment?
 
GERRY           No, and I think that’s a very important point. It’s why I don’t really want to get into any sort of terrible blame game in this I think we should be very, very encouraged that through this seismic event, insurers have renewed policies in general and have stuck with our market, and I think that’s very important.
 
JESSICA        So you’re not considering any type of government intervention in this area?
 
GERRY           Well, this isn’t something that you can intervene on, short of taking over all the contracts. And we don’t want to do that. We’ve had the difficulty of AMI already. We do have to accept that New Zealand is a highly insured country. We are a country that has a number of risks from North Cape to the Bluff, and we do want that insurance market to stick with us. And they are, and they will.
 
JESSICA        I want to look forward now. Tomorrow you’re going to be announcing the blueprint for Christchurch, or the plan, if you like. What is it going to look like?
 
GERRY           Well, I think it’s going to be seen as a fairly exciting plan. The first point I’d make is that the Christchurch City Council produced a draft after running a very big public exercise of getting people’s views. And in total 106,000 people from greater Christchurch put forward ideas about what they wanted the city to look like, and this plan keeps absolute faith with that.
 
JESSICA        So how are you going to breathe life into this plan? What can you tell us about it?
 
GERRY           What I can tell you is the government will be announcing tomorrow its part of giving some effect to the shape of the new city. And then in coming months, you’ll see the Government be able to make announcements about things like the hospital, the Advanced Technology Hub, what we’re calling the justice precinct, etc. They are very big public assets that are also places of considerable employment. And so that is a pretty significant step in letting other investors know, ‘Actually, there is going to be a dynamic here that works.’
 
JESSICA        Who’s going to pay for these plans?
 
GERRY           Well, it’s going to be a mix of both the private sector and the public sector.
 
JESSICA        Can you tell us any more details about that mix?
 
GERRY           Well, what I can tell you is the vast majority of property in Christchurch is owned by the private sector, and there are numerous investors both in this city, outside the city and internationally who are looking at the prospects of being able to rebuild what will be the centre for a population of about 560,000. So some exciting opportunities there On the civic type of assets, you would expect that they would eventually be Christchurch City Council assets. And the Christchurch City Council has identified some projects they want to move with over time, and they’ve also committed in their latest budget around $790 million towards those projects. So there will be a discussion that goes on from tomorrow about how you sequence those things and what our timeline might look like for their delivery.
 
JESSICA        Can you give us any more details on exactly how much taxpayers will have to front up as part of this plan?
 
GERRY           Well, on this part of the plan, this is not a big expense that taxpayers are having to meet here in Christchurch. So in total, we’ve committed $5.5 billion to date towards recovery here. And, you know, a lot of that money is being spent here in the city right now for the horizontal infrastructure rebuild, for the land purchases that we’ve done so far, things like that. Over and above that, we’ve stood behind EQC, which affects the whole country. So that’s another seven that we could be up for. And then there is the projects that have to be done in education and health and innovation, those sorts of things. So it’s very hard to put a total quantum on it. Some of it is provisioned. Some of it is actual. It will be many billions.
 
JESSICA        Once this plan is laid out tomorrow, when are we going to actually start seeing some action? When we are going to start seeing a timeline of when this CBD will be rebuilt?
 
GERRY           Well, I would hope the action starts on Tuesday morning. When we would we see that? I would hope by the end of the year, we we’re seeing some of those projects either announced for delivery or actually started, in the case for a couple of them.
 
JESSICA        I want to talk about your recent court process that you were involved in this week, basically questioning the power that you have as Earthquake Recovery Minister. Are you going to appeal that decision?
 
GERRY           I’m taking a bit of time to speak with my legal team to get advice. I’ve had preliminary discussions.
 
JESSICA        What’s that preliminary advice?
 
GERRY           Well, the preliminary discussion is about the judgement and what it means, and I’ve got a number of questions that’s come out of that that I’d like them to answer.
 
JESSICA        Do you admit that you went too far?
 
GERRY           No. I think that the judgement itself says that the actions have been taken in good faith, and I’m very encouraged that the decisions about new subdivisions that have come out of that decision have been allowed to stand.
 
JESSICA        So you think the court is wrong?
 
GERRY           I’m not saying that. I think this a considered piece of legal judgement from a High Court judge, and we need to think about exactly what that means in relation to the various authorities that we have under the act.
 
JESSICA        How long do you think we’re going to need an Earthquake Recovery Minister for?
 
GERRY           Oh, well, certainly for the rest of this Parliamentary term, and I would expect for a number to come. What we have is the powers of the Canterbury Earthquake Recovery Authority that are extended out to 2016, and I would still expect the coordinating department to continue beyond that. But some of that will be decision making that has to be done in any particular Parliamentary cycle.
 
JESSICA        One of the things you’ll have to deal with as Earthquake Recovery Minister is the Cathedral. Now, every city needs an icon. Will the government get involved in this process in terms of funding?
 
GERRY           I think we’ve got to be very careful about that. There are so many other calls that we have that put life into a city that we will have pressure to consider for funding. The church is put there initially by the founding fathers of the city. The land was made available for the Anglican Church to have a cathedral there. That was reaffirmed by Parliament in 2002 with the Church Trust Property Act. And there is a discussion now going on between the church and some people who think there is a way of saving it, and I think that’s an appropriate discussion to continue. There are no costs on it. There is no work programme for it. But I would be very confident that in the long run, there will be a cathedral there. It’s a question of whether it’s the old one or is it something new.
 
JESSICA        Personally, how do you feel about the Cathedral?
 
GERRY           Well, I think it’s interesting that Christchurch has identified itself with the Cathedral. That’s a great thing, but is that cathedral, or is it the fact that we have a cathedral in the centre of the city? I’m not able to work that out myself in any strong way. I think the greatest asset that we’ve got here in the city is the Avon River, the Otakaro, which, of course, will be part of the recovery plan, or the future for that will be part of the recovery plan announced tomorrow.
 
JESSICA        And that’s a nice place to leave it. Thank you very much for joining us this morning, Gerry Brownlee.
 
GERRY           Thank you.

ENDS

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