Two high profile enterprises in Hawke’s Bay — the Hawke’s Bay Opera House and the Hawke’s Bay Airport — apparently changed “life forms” on July 1.
The Opera House became a “charitable company” instead of merely a money-losing arm of the Hastings Council. As if by magic, this legal transformation is supposed to somehow make the operation more “business-like” and improve its financial fortunes. But it’s not clear why or how this is supposed to happen.
Yes, the deck chairs have been re-arranged, but all the same overseers, including Councillor Bowers, are occupying the chairs! One might ask: If these folks couldn’t make a go of it before, why should they be successful now, simply because they changed hats? Meantime, who provides the performance goals and the funds to balance the books? Still the Hastings Council. So much for business direction.
Up the road, the Hawke’s Bay Airport has now been “corporatised,” meaning chiefly that it can now borrow money to do things like fund runway extensions and business parks.
Its governance has also changed, with two new directors named by the Crown — Jim Scotland and Stuart Webster — and one director each appointed by the Napier and Hastings Councils (who both chose to re-appoint individuals from the previous airport authority).
Despite the two holdover appointees, this team strikes me as more likely to succeed. Jim Scotland is chairman of the board of the Napier Port, which has been doing quite well financially, thank you. The Port’s board is named by the HB Regional Council.
But perhaps the key to the Port’s success is that the HBRC doesn’t meddle in the business! Like Scotland himself, the other Port directors are savvy business people. While the board is ultimately accountable to the Regional Council, it operates on a long leash.
That’s why it was scary to see that yesterday’s HB Today was full of Mayor Yule saying the airport would do this … then it would do that … then it would do the next thing. As if he were running the show, as he definitely is with the sports park trust. But Jim Scotland doesn’t strike me like the errand boys Mayor Yule has put on the sports park trust. Indeed, the new airport company won’t have directors like Scotland for long if politicians insist on sticking their noses into the business going forward.
In fact, the Hastings and Napier Councils might consider the unique success of the Port of Napier’s governance model and practice, as they ponder what to do about their money losers like Splash Planet and Marineland, and their other business-like assets.
The less our politicians are involved in these entrepreneurial activities, the better off ratepayers will be.