An attempt to sell the Wellington City Council’s shares in Wellington Airport divided the city’s political left and created a dramatic showdown between councillors and activists. It led to an unwinding of the council’s 10-year plan and central government intervention.

In the first of a three-part series running this week, Oliver Neas asks: How did this happen?

Six hundred years ago it was water. Then came the land swallower — the earthquake named Haowhenua — which ripped the seabed upwards, turning an island into a peninsula, and revealing the narrow isthmus on which Wellington Airport now sits. 

The first aeroplane lifted off here in 1911, a homemade machine, briefly airborne over Lyall Bay. In the 1920s, the City Council leveled the sand dunes and built an aerodrome, later upgrading it with unemployed relief workers during the Great Depression. In 1952, the bulldozers came. Roads were rerouted, homes relocated, hillsides flattened. Four hundred and fifty Olympic swimming pools worth of dirt were tipped into the sea.

By the time the new airport officially opened in October 1959, it had become the largest municipal project ever undertaken in New Zealand. And like the country’s other key infrastructure built with public money — its roads, hospitals, schools, water pipes and power lines — Wellington’s airport was to be owned and operated publicly. And so it was for 30 years until a new wind swept through, blowing first from the Treasury to the Beehive and then, eventually, to the airport at Rongotai. 

In 1987, Treasury officials presented the incoming Labour government with a 400-page briefing signalling a radical shift in the economy and society. If services could be provided by the private sector, officials decided, they should be. Over the next decade, $20 billion of assets were sold off, often at bargain prices, with the proceeds largely used to pay off government debt. The consequence was a colossal transfer of public wealth into the hands of relatively few.

Change came to local government, too. Wellington’s bus fleet was sold to a Scottish company, while the electricity network was sold to a Canadian one. The airport was next. First, it was corporatised – transferred to a company owned two-thirds by the central government and one-third by the council and required to turn a profit. Then, in 1998, prime minister Jenny Shipley, leading a National-NZ First coalition, announced plans to sell the government’s share. Wellington mayor Mark Blumsky said the city would sell its stake too. He was confident he had the numbers at council to do so. But one councillor he was counting on was having second thoughts. 

By his own admission, councillor Kent Clark, a full time bus driver, had been changing his mind on the airport sale almost daily. On the morning of the vote, while driving the 6.25am bus from Karori, he held an informal poll of his passengers. They opposed the sale, so he did too. The vote failed. In the confusion that followed, deputy prime minister Winston Peters stormed out of cabinet, unwilling to support the sale of the government’s shares, effectively dissolving the coalition in the process. “So be it,” said Clark, the bus driver who had seemingly brought down a government. 

Incredibly, the city had held on to its airport. But it was a new era. Shipley’s government had gone ahead without Peters and sold its airport shares to Infratil, an infrastructure investment firm, leaving the council a minority shareholder of a for-profit company. If the airport was a bridge on the state highway, it now had a toll booth, with a private company clipping the ticket. But at least some of the proceeds went to the public — and with most of the city’s other assets now sold off, the airport shares were the most valuable of what remained, generating hundreds of millions of dollars in dividends over the next two decades and increasing in value twenty-fold. 

Twenty-five years after the attempted sale of Wellington Airport brought down a government, another attempt has derailed a mayoralty. In May, the Wellington City Council — led by a Green Party mayor, Tory Whanau, and with a progressive majority — voted to sell the city’s airport shares and use the proceeds to set up an investment fund. It was pitched as a solution to the insurance problems of an earthquake-prone city; opponents saw the proposal as a betrayal of fundamental left-wing principles achieved through dirty tactics. The fallout has been extreme, opening up a chasm between politicians and the bureaucracy, exposing faultlines on the political left, and ultimately leading to the central government appointing a Crown observer. 

This is the story of the Wellington Airport sale – of the attempts to stop it, how those attempts were overcome, and how it all then fell apart. 

A plot from within

On a Wednesday night in December 2023, a group of unionists met at Trades Hall on Vivian Street, the spiritual home of Wellington’s union movement. It was the AGM of Unions Wellington, the local branch of the Council of Trade Unions. Many of those attending were natural allies of the city’s mayor, Tory Whanau. However, one item on the agenda was a challenge to a core part of the mayor’s plan for the city. 

A month earlier, councillors had agreed to consult the public on a proposal to sell the council’s airport shares as part of its long term plan, the council’s ten-year budget. The sale was listed as the council’s “preferred option”. It was perplexing to the unionists. The Green Party had a long history of opposing asset sales, and its candidates had campaigned explicitly on retaining public ownership of Wellington Airport. What was the mayor doing? She insisted her plan was nothing like the privatisations of the 80s and 90s. “I will never lead a city that sells airport shares to pay down debt. I have never supported selling the silverware to pay the mortgage,” she said. But many of the unionists at Trades Hall didn’t buy it. This was a serious provocation.

Finn Cordwell, a 24-year-old community organiser, was one of those present. He had grown up watching documentaries about Rogernomics and saw the council’s proposal as “just another example of a public asset being sold off to enrich just a very small collection of shareholders.”

“Something that was owned by every single Wellington citizen – an asset that was going to grow in the future that we had influence over as a public monopoly – was now just going into the hands of the few, just like all those sales in the 1980s have. I felt like this was our generation’s moment to put a line in the sand.”

A new wave of privatisations was sweeping local government, as councils nationwide looked to sell their stakes in major assets to raise cash – from the Auckland and Christchurch airports to the Port of Tauranga. Cordwell had watched the Auckland Airport sale closely and believed it could have been prevented. “There were backroom discussions, but there was never a public campaign to shift the narrative against the sale. I believed that if we ran a proper campaign and organised properly, we could stop the sale.” 

Cordwell proposed that Unions Wellington campaign to do just that. Alongside Unions Wellington co-convenor Sabina Rizos-Shaw and her partner Ashok Jacob, he formed an action group. The trio would run a two-prong campaign, engaging councillors directly while mobilising the public to show decision-makers they care. 

There was reason to think they could win. The council was dominated by left-wingers, and public ownership was a left-wing value. Yes, the four Green councillors had voted to consult the public on a sale, but Cordwell was sure they could be talked round. The mystery was how they had been convinced to support a sale in the first place. 

On a sunny Saturday in early March, the ‘Keep The Airport Ours’ campaign was launched at the annual Newtown Festival. A team of volunteers talked to festival goers, collecting signatures and encouraging people to pose for photos with signs the team had made: “Stop privatization,” “I support public ownership,” and “I didn’t vote Green to sell our assets.” 

The last sign was designed to provoke a response—and it worked. Among those who passed by was first-term Green councillor Nīkau Wi Neera. As Cordwell remembers it, “Nīkau came across it and was quite fired up by it. He was like, ‘do you guys understand the reason why we’re having to do this?’ That was his big line, ‘do you understand the reason for it?’” Well. did they?

‘Everybody wins’

Nīkau Wi Neera wasn’t yet born when Winston Peters quit the coalition over Wellington Airport. When he was elected in 2022 as a member of the newly established Te Whanganui-a-Tara Māori ward, the 23-year-old had no idea the council even had a stake in the airport. He assumed the central government owned it. 

Wi Neera is a socialist. When he heard of the airport proposal, his first instinct was “very anti-sale.” But as he learnt more about the idea, he came to feel that this wasn’t really a privatisation at all. It was actually a “toothless asset transfer, which could solve the council’s insurance problem,” he says. 

For years, officials had advised of a need to “diversify” the council’s assets. The concern was that the city’s two main investments – the airport and a series of ground leases – were both at risk of being damaged in a major natural disaster, which could rob the city of essential revenue. Selling the airport would allow council to put its money somewhere else, safe from earthquakes and floods.

The risk of a big earthquake also underpinned the “insurance problem”, Wi Neera spoke of. Insurance was becoming harder to obtain and premiums were rising. An update in 2022 to the National Seismic Hazard Model revealed the severity of a likely earthquake in Wellington was more than double previously thought. All of a sudden, the council’s insurance coverage fell seriously short of covering the damage of a major earthquake — $2.5 billion short. Officials warned that, without a solution, the city could be left in the lurch when it needed its council most.

The sale of the airport shares offered a solution. The council could put the money from the sale – probably around $500 million, according to consultants – into an investment fund. This would both diversify the city’s assets and cover some of the insurance shortfall. To preempt fears the money would be frittered away or used to pay off debt, as had happened with the asset sales of yesteryear, the fund would be protected so that it could only be used in emergencies. This was not an asset sale; it was exchanging a “public asset” for an “even better public asset,” Whanau claimed. 

But for Wi Neera, there was an even more persuasive argument: according to the mayor’s team, the airport shares could be sold to local iwi. In fact, the mayor wouldn’t vote for a sale unless the shares went to mana whenua, Wi Neera recalls one of the mayor’s advisors telling him. This claim spoke to one of Wi Neera’s central political concerns: as a candidate, he had described returning “land, water, and assets to Māori wherever possible” as his number one priority. “Iwi get an airport, council gets an insurance fund, everybody wins – basically that was how it was sold to me,” Wi Neera says. “I obviously don’t like selling public assets, but if it’s iwi it goes to, that’s OK to me.”

But there was a problem. This idea didn’t seem to be written down anywhere. Anxious to get clarity, Wi Neera spoke to the mayor’s team, and they agreed to sponsor an amendment to signal that the council’s preference was to sell to iwi. But the wording of the amendment was weak. Council officers would just be directed to “engage with Takai Here partners and consider their interests” in preparation for a sale. Wi Neera pushed for stronger wording – to give iwi something like a right of first refusal – but was told this was not possible for technical reasons. He says he was told not to worry; the shares would go to iwi. “I was like, ‘Okay, fine. If it’s going to go to them, it’s going to go to them’.” 

The night after the consultation vote, Wi Neera joined Labour councillor Ben McNulty, who opposed the sale, on Reddit to explain their respective stances. He struck a downbeat tone.  “I am deeply opposed to privatisation and most public asset sales, and would never, ever support them to pay down debt or artificially keep rates low – or basically any scenario other than what we encountered in this case”, he wrote. “I will say that, if it comes to the sale, I will strongly oppose any sale which would not guarantee purchase of our stake by an ethical, intergenerational entity with genuine ties to this whenua. You may be able to guess what I’m talking about here, but for legal reasons I can’t be any more explicit than that.”

By the time Wi Neera logged off that night he’d received “a little bit of heat” from some Redditors but felt it was nothing to worry about. It wasn’t long before that would change. Over the next three months, Wi Neera would come to a startling conclusion. “I discovered that the two reasons I voted to put it out to consultation were bogus.”

‘Am I crazy?’

“Partisan nonsense” – that was what Wi Neera first thought of the campaign against the airport sale. The Unions Wellington campaign wasn’t the only one. The Wellington branch of the Labour Party had launched its own in February. “I was like, this is just Labour being salty about losing Rongotai [electorate] and trying to have a go at us. That was a view that was actually shared by some of my Labour Party colleagues. We thought it was hackery basically.” 

When Wi Neera encountered the Unions Wellington stall at Newtown Festival in March, he confronted Finn Cordwell. “I was like, ‘bro, what are you talking about? Do you understand the problem we’re trying to solve here?’ And he didn’t.” But it wasn’t only Labour and the unions giving him grief. Wi Neera was now hearing from all sorts about the airport sale. Was he missing something? Up until this point, Wi Neera had been getting “basically all” his advice from the mayor’s team. He decided it was time to take wider soundings. The more conversations he had, the more he realised something was amiss. “I started to think, this is fishy, man.”

One of those who had Wi Neera’s ear was Craig Renney, the chief economist for the Council of Trade Unions. A former Treasury official and advisor to then finance minister Grant Robertson, Renney had become one of the country’s most high-profile left-wing commentators on economic issues. He wasn’t exactly independent; Unions Wellington had recruited Renney expressly to scrutinise the business case for the sale. But he did have the credentials. In a previous life, he had audited local government accounts in the UK and had worked on the Canterbury earthquake response at the Treasury, so had insight into how central government might respond were the big one to hit Wellington. 

As he dug into the issue, Renney was struck by how much the case for the airport sale had shifted over time. First, it was about investment return, then diversification, and finally, insurance. “For a long time, the council in the widest possible sense – not the councillors – has wanted to get rid of the airport so it’s got a much more liquid asset it can trade with,” Renney says. The push for a sale wasn’t new. But the insurance argument was. And that idea could be traced not to council staff but to a first-term councillor with a career uniquely intertwined with the airport: Tim Brown.

Brown first became involved with the airport in the mid ‘90s, when he worked for Morrison & Co, a firm that advised foreign companies wishing to buy newly privatised assets. Soon after Morrison & Co was hired to help finance a new terminal for the airport, the government sold its airport shares to Morrison & Co’s infrastructure fund, Infratil. Brown was appointed a director of the airport board in 1999, and in 2013, he became chairman until he stepped down in 2022 and ran for council. In his first meeting after being elected, he learnt of the council’s insurance problem. The council had been searching for a solution. Brown had one. The airport sale was now the council’s preferred solution to an existential risk to the city.

The insurance problem was real, but it wasn’t just a Wellington problem. Councils nationwide were struggling to get insurance in the face of growing climate and seismic risks. Wellington needed to prudently manage the risks to its assets, but there was no one way to do so. The approach Wellington City Council had taken was to set an insurance target based on the expected losses from a 1 in 1,000 year earthquake – a benchmark that comes from the solvency standards the Reserve Bank sets for insurance companies. Renney thought this was excessive. “We appear to be potentially over-insuring ourselves. We’re essentially insuring assets that just won’t get built again,” he says. It wasn’t that the council was wrong to be cautious but that it was treating a contestable benchmark as a bottom-line. 

Fundamentally, the council’s problem wasn’t really about insurance, it was structural. “The councils cannot borrow enough money or get enough money to pay the bills. Central government keeps asking them to do new things. They have growing liabilities and very, very few means of generating new revenue,” Renney says. This is not a problem that will go away in two or three years’ time with a bit of money and some good luck. Fundamentally, they need a new financial settlement.” In other words, why sell the silverware when it won’t solve the underlying problem? The likely outcome of the sale, Renney believed, was that the money would inevitably disappear. While the plan was for the fund to only be used in a disaster, Renney feared that “everything would become a disaster”.

The other arguments for the sale were also contentious. It was possible the fund would generate a better return than the airport shares, but this was speculative. Modelling from KPMG suggested the likely difference was about $5 million over ten years—not a lot. While it was true the airport might be impacted by an earthquake, it was also likely to be one of the first things up and running again, given its strategic importance.  

Ultimately, Renney came to the conclusion that the airport sale wasn’t some special exception to the usual rules of privatisation. It was the way it always went. “With any public asset, the first thing you say is it’s not providing a return. Two, the private sector can run it better. Three, we can do more with that cash. Four, we’re not a good owner of this. It’s the same story over and over again. It’s just packaged differently.”

Simmering beneath the arguments and counter-arguments was a clash of worldviews. Was there inherent value in local infrastructure being owned by the local community? Was there value in the city having seats on the airport board and a veto over major transactions? What did history tell us about what might happen to the fund in future? This was not just a technical issue. It was an ideological one.  

In March, Renney put these arguments to Wi Neera at a meeting with the Unions Wellington crew at a cafe in the Spark Building on Willis Street. It seemed to land. Wi Neera recalls his thoughts, “The more I looked at the numbers, I was like, man, this doesn’t add up. Am I crazy? We’re expecting to get between four and five hundred million from the sale, but the scale of the problem is in the billions. What’s the point?”

Then there was the sale to iwi. It now dawned on Wi Neera how unlikely this was. For one thing, it wasn’t clear how Taranaki Whānui could afford the shares. And even if it could, it was far from certain they would end up the buyer. The council had a fiduciary duty with public money to take the best offer on the table. There was no guarantee the iwi would have the best offer. Wi Neera has since described the idea of selling to iwi as “a con”. Had the mayor’s office misled him?

The council says it holds no records of communications between the mayor’s office and Taranaki Whānui regarding the airport sale. However, councillor Tim Brown says he reached out to the iwi last year and connected them to the airport company “to get the ball rolling”. Taranaki Whānui has since confirmed its interest. But so has Infratil, the firm that owns two-thirds of the airport. The mayor’s office declined to comment on the matter.

Wi Neera was in a bind. He saw the insurance problem as a genuine issue but believed the sale was a false solution. Surely there had to be another way?

A meeting with the mayor

Nīkau Wi Neera was one vote. To stop the sale, Unions Wellington needed nine.

The fate of the airport was, in the first instance, in the hands of the council’s long-term planning committee, which would decide the contents of the long-term plan on 30 May. On the committee sat the 16 councillors plus two mana whenua representatives, appointed by Taranaki Whānui and Ngāti Toa. Nine votes would be a tie, which would give the casting vote to the committee chair, Labour’s Rebecca Matthews.

Wellington City Council is only half a kilometre from parliament, but it is an entirely different world. In parliament, the government commands a majority, and hashes out its agenda behind closed doors in cabinet. Council is like a mash-up of parliament and cabinet; instead of a formal majority, there is just the constant and public shifting of alliances. For the council term so far, mayor Tory Whanau had enjoyed the support of an informal left-wing majority: the eight Labour and Green councillors, plus two former Greens Iona Pannett and Sarah Free.

The airport sale complicated the equation. It was being pushed by a Green mayor and had so far been supported by all councillors except the four Labour members – Nureddin Abdurahman, Teri O’Neill, Rebecca Matthews, and Ben McNulty. The Union Wellington crew hoped to win over the Greens, but there were no guarantees. They needed to look further afield.

Throughout March and April, the three unionists – Cordwell, Rizos-Shaw and Jacob – hurried between cafes and meeting rooms, meeting as many councillors as possible to talk them through the issue and invite them to a public forum they had planned, where they would get them to commit publicly to a position. They encountered a kaleidoscope of perspectives on the airport, which refused to split cleanly along left-right lines. The issue was like a political Rorschach test: each councillor saw in it their deepest political concerns.

Former Green Iona Pannett saw it through a climate change lens, but was torn as to where that left her. “If you’re serious about decarbonising, then why would you own an airport which is one of the biggest polluters in the city?” she says. But then: “If it goes into the private market, then they will maximize profit. They want more people flying in.”

Surprisingly, the most strident opponent of the sale was not a left-winger at all. It was Ray Chung, the idiosyncratic right-wing mayoral hopeful. He saw it as a matter of fiscal responsibility. He was convinced the council would sell the shares, “take the $300 million and spend it on some frivolous ideological-driven project,” he wrote in an email to Rizos-Shaw. 

At the other end of the spectrum was Tim Brown, the architect of the sale, who was brutal in his appraisal of the anti-sale campaign. “I listen to their arguments, and I find them so sterile and bankrupt in every single possible way,” he says. “When I went to see the Unions Wellington guys, I said to them, ‘Look, I’m not wedded to selling the airport stake. I’m probably better informed than anyone to understand its merits as an investment, and it is a good investment. But we have got a really major problem here, and have you got a good solution? And, you know, they came back with complete bullshit. I sat there listening to their case. And I just thought, you really are fighting Roger Douglas’ ghost here. Your arguments are just nonsense.” 

Other right wing councillors were harder to read. Diane Calvert seemed somehow both opposed to the sale and to Unions Wellington’s campaign to stop it, calling the campaign a “publicity stunt” by Labour in an email to Rizos-Shaw. “If you and other Labour-aligned organisations (including elected members) were genuine about asset ownership, you would also be campaigning to retain all community assets”, she wrote, referring to the council’s plans to close the Khandallah pool. 

A week before the public forum, a calendar invite landed in the Unions Wellington inbox. It was from the mayor’s office and was for a meeting in a few days. And it wouldn’t just be the mayor. Multiple Green councillors, senior council staff, and the mayor’s key advisors would be attending, too. It wasn’t the low-key chat Unions Wellington had imagined, but it would be the most important meeting of the campaign. It didn’t go to plan.

Their ultimate objective was to convince the mayor to reconsider selling the airport. But standing outside the council building before the meeting, with a room of heavyweights inside, Cordwell suggested they adjust their expectations. “We’re not trying to convince them. We just need to not get too battered. And make sure they’re still going to come to the forum,” he told his two colleagues. 

They walked into the mayor’s meeting room, flanked by support. They’d brought Craig Renney with them, along with Rilke Comer from the advocacy group Climate Clinic, who was there to speak to the issue’s climate change dimension. 

There were seven in the mayor’s contingent: the three other Green councillors, regional councillor Thomas Nash, the council’s chief financial officer Andrea Reeves, and the mayor’s chief of staff Nadine Walker. A former Green Party press secretary and partner of party co-leader Chlöe Swarbrick, Walker was widely seen by councillors as hugely influential within the mayor’s office. As one councillor said, “Let’s be very, very clear. Nadine is running the show.”

No written records of the meeting exist, and the mayor has declined to comment, but conversations with more than half of those present confirm the general narrative.  The Unions Wellington delegation spoke first. Renney, Comer and Cordwell argued why the council should not sell. The response from the other side – conveyed mainly by Walker and Reeves – was that the mayor didn’t actually want to sell but felt there was no alternative. 

Rilke Comer had only been tangentially involved in the campaign but could tell there was tension in the air. “It felt like a pretty hostile environment,” she says. It was all polite enough at first. But after half an hour, Renney and Nash left, and the tone shifted. 

Cordwell raised the topic of the public forum, asking the mayor to attend so she could explain where she stood to her supporters. Rizos-Shaw had emailed the mayor’s office an invitation weeks before but had received no reply. As it happens, the mayor’s team had already decided that Whanau would not be attending. A staffer advised the deputy mayor of this four days beforehand – although no one had told Unions Wellington.

The two sides went back and forth but made no progress. Ninety minutes after the meeting began, the Unions Wellington crew stumbled out onto the Terrace bewildered. Rizos-Shaw was nearly in tears. An hour late for work, she texted her boss: “just got yelled at by the mayor, sorry!”

“It was a bad atmosphere,” says Jacob. “Tory has done a lot of yelling, accusing us of sabotaging her personally, having an attitude problem, refusing to come to the forum. It couldn’t have gone worse.” Two days out from the public forum – a crucial moment in the campaign – their confidence was shaken. But there was still hope – two glimmers of it, in fact. 

The mayor’s team had agreed to meet again with Unions Wellington and Renney to, in Walker’s words, “see if there’s any other solution we haven’t stumbled across yet”. And it wasn’t quite a definitive no regarding the mayor’s attendance at the forum. The sticking point was that the mayor’s team believed that, by attending the forum and stating her position on the issue, the mayor could land herself in hot water by breaching her legal obligation to consult the public “with an open mind”.

The Unions Wellington crew felt this concern was misguided but agreed to reword the question they proposed to put to councillors to address the mayor’s concern.  Sixteen minutes later, Walker replied, “Tory is still going to decline going to this meeting, and I have to say, unfortunately, even with your commitment to a safe environment to discuss, I found this agenda item framed up in a way that is disconcerting.” Walker was referring to the agenda item described as “Pinning Councillors/Mayor down”. Rizos-Shaw was confused. “‘Pinning’ is merely community organizing slang for asking candidates yes or no questions,” she replied.

“OK, thanks for clarifying,” said Walker. “I am used to Greens language/kaupapa, where metaphors that invoke violence are avoided, so perhaps that is why I was shocked to read that!”

The mayor would not be attending. Instead, a statement was provided, which was to be read out to the crowd that gathered at Thistle Hall on Cuba Street the following evening. Of the councillors who fronted, only Tim Brown said he backed the sale, while Iona Pannett wasn’t yet sure where she stood. The other seven – Labour’s Teri O’Neill, Rebecca Matthews and Nureddin Abdurahman, the Greens’ Nīkau Wi Neera, Laurie Foon and Geordie Rogers, and independent Ray Chung – all said they would oppose the sale.

To Unions Wellington, it felt like victory. They had secured public commitments from seven councillors and felt they could rely on Labour’s Ben McNulty, who couldn’t attend the forum for personal reasons but had vocally opposed the sale. That gave them eight votes. One more and it would be a 9–9 tie on committee. “We thought we’d saved the airport,” Cordwell says.

But if their meeting with the mayor had taught them anything, it was that it would be a struggle every step of the way. There were six weeks until the vote. 

In part two of Privatisation Lost, out tomorrow: Conflict and betrayal as councillors turn on each other. Plus, a secret society called The Order of the Rabbits.