Chief Ombudsman’s port study ruling welcomed

The Northland Regional Council has today released the $76,189 cost of a two-year-old report into its investment in Northland Port Corporation, as suggested by Chief Ombudsman, Dame Beverley Wakem.

Council chairman Bill Shepherd says the council is grateful to Dame Beverly for clarifying the issue in a finding he says largely vindicates council's approach on behalf of its ratepayers, including supporting its decision to keep the report itself confidential for commercial reasons.

Councillor Shepherd says Dame Beverly became involved after a request from a business journalist and an individual minority investor who had earlier unsuccessfully sought the report, by investment banking and corporate advisor Rockpoint Corporate Finance Ltd.

"Dame Beverley has a background in broadcasting, public relations and consulting for both the public and private sectors and is held in high esteem internationally for her skills as an Ombudsman over the past nine years. We accept her opinion we should release the cost – but crucially not the content – of the report, which we commissioned over two years ago on our investment in Northland Port Corporation Limited."

Councillor Shepherd says the total cost of preparing and presenting the report was $76,189 + GST, which had included visits to the port and Whangarei, meetings and disbursements etc.

"Council obtained the report in its investor capacity as the major shareholder of an NZX listed company that it views as a significant and strategic asset for Northlanders. My colleagues and I are very satisfied with the report and Dame Beverly has agreed its contents should remain confidential to the council for commercial reasons."

Councillor Shepherd says nothing precludes other investors or potential investors in the port corporation from commissioning their own reports if they wish.

"As for the investment itself, council's shareholding had an NZX value of $41.8 million at $1.89 per share as of 30 June 2012 and as of 24 April this year has a value of $67.1 million at $3.03 per share."

"Since June 2012, we've also received $4.4 million by way of dividends, which is a direct relief to ratepayers, and means that Northland Regional Council has some of the lowest rates and levels of debt of any regional council in New Zealand."

Councillor Shepherd says the regional council has long been a prudent and careful investor on behalf of its ratepayers.

"Indeed, one of the reasons that we are able to forecast a nil general average rates rise for the 12-months from 01 July this year is in part due to better-than-expected returns on our investments."

He says as a ratepayer-funded body, the regional council has an obligation to look at the bigger picture when dealing with a key regional infrastructural asset like Northland Port Corporation.

"These considerations are often not the same as those required in the private sector."

Councillor Shepherd says the council retains a keen interest in the future of the port corporation, which includes obtaining independent advice like the Rockpoint report.