Yes, there is a highly contagious viral epidemic in Hawke’s Bay. It attacks your pocketbook, eating away at your hard-earned income.

As if Councils spending your money (and borrowing profligately against the piggybanks of your children and grandchildren) wasn’t unhealthy enough, the spending virus has now infected Unison, your powerlines company.

Most BayBuzz readers know by now that Unison has committed $1,000,000 to Mayor Yule’s velodrome.

Putting that number in context, Unison Directors have declared a dividend of $6.2 million for 2009. You and about 56,999 other hard-pressed consumers will share about $108 apiece. That should cover your extra petrol cost to get to the velodrome, should you have occasion to go. I suppose you could cycle over.

This $1 million commitment is contingent on the velodrome actually being built. Unison CEO Ken Sutherland notes firmly that the contribution ($250K in-kind, and $750K in cash, spread over three years) is not transferable … that is, no velodrome, no money. It seems that since the velodrome brings naming rights (i.e., brand awareness), it’s worth the expense to Unison shareholders. But as a gift to the sports park sans velodrome, it’s not. Hmmm … there’s a rousing endorsement!

According to Ken, the velodrome commitment represents the largest of Unison’s community contributions or sponsorships. However the total quantum of such commitments is treated as confidential. The cursory information in Unison’s Annual Report shows a penchant for contributions to sporting — rugby, sailing, sports awards, Pettigrew Green … and now elite cycling.

Unison shareholders have about as much say in such spending commitments (they’re considered mere “operational” expenses) as ratepayers have over Council spending for paper clips. Which is to say … none. Apparently, because management appreciated the sensitivity around making such a commitment to a controversial project, corporate Directors, as well as the Trust that guards your shareholder interests, were “kept informed” of the prospective contribution.

I ran last year for a seat on the HB Power Consumers Trust, but sadly failed at the opportunity to represent your shareholder interests.

Had I won, I would have argued against a contribution to the velodrome. Not only because I think the velodrome is an extravagance. But also because I believe that, if Unison is so flush as to afford a $1 million gift to anything, I can think of far more needy beneficiaries than the Ramblers Cycling Club.

For example, the Herald recently reported that NZ electricity companies were trying to chase down millions in unpaid consumer electric bills. Why unpaid? Helloo … we’re in a fairly deep recession. It’s tough for the unemployed to make ends meet. Maybe instead Unison could spread its wealth to help some of these unfortunates pay their power bills.

For example, the HB Regional Council, in a recent “Leaders Briefing” mailer (I loved those cute pictures of each of the Councillors … could an election be on the horizon?), said it was striving to provide complete insulation and clean heat (like electric heat pumps) to 4,000 homes per year for the next four years. Sounds like they could well use a bit of subsidy. But too late Chairman Dick, Mayor Yule has beaten you to the cash window. And I guess 4,000 little plaques in healthy homes aren’t worth one plaque at the velodrome.

For example, Unison could simply hand the surplus $1 million to its shareholders, you and me. I guess that’s too boring.

Any of these options seem more appealing to me … and worth more in goodwill to Unison. But I suppose they considered all that. And even if the velodrome doesn’t get built, Unison’s name already looks nifty in that flash sports park promotional DVD. Not a bad hedge on their (our) potential investment.

Tom Belford

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2 Comments

  1. Let me make it clear I am not opposed to a Velodrome, or the people who are working so hard to make it a reality.

    What many of us are opposed to is the likes of Unison using its captive market as a tax base to fund anything other than their core business.
    Customers do not have a choice of lines company, only the power retailer, so for example if we dont like the actions of Contact, we can change to Energy on Line etc.
    If Unison has a $million to ‘sponsor’ anything, then they are abusing their captive market by charging too much.
    Why do they need to advertise at all, they have got us by the balls!

    Similarly, when HDC runs a referendum on the basis that the RSP will be rates neutral, then any deviation from that stance is a fraud.

    Many of us cannot understand also that if suburban tennis clubs are struggling, then how can the solution be to shove them all to an extremity of the city boundary, & charge them something like $5 a game?

  2. "Your blog relating to Unison's sponsorship of the velodrome is yet another Bay Buzz rant with no understanding of the facts.

    You persist with the myth it's an elite facility. It's not. If you want proof check out the Southland velodrome which is overwhelmingly used by the community, 10,000 of them annually including kids right through to the elderly. In fact the "elite" have difficulty getting adequate time on the track.

    For all that we're proud that the elite will be using our track. But actually they're not elite in the way you portray it, they're New Zealand's premier cyclists. We'd be delighted if the All Blacks stationed themselves here so why not the cyclists.

    Unison's sponsorship is a commercial decision. Of course they're not going to spend this money on the Sports Park irrespective of the velodrome proceeding or not. You'd be the first to moan if they did. And what's wrong with keeping the shareholder interests informed of their decision?

    The velodrome is going to be a fantastic facility for Hawke's Bay, and incidentally it's going to be delivered to ratepayers for a fraction of the cost at least one other city in the bidding is proposing to charge. And you know what, that city's ratepayers have strongly endorsed their pitch in a public referendum.

    Come to think of it we also endorsed the velodrome as part of the Sports Park referendum and with a higher voter turnout than the local body election at the time it was a strong endorsement. So on behalf of the increasing majority who want to get the Park and the velodrome built…. move on. The region could do without your enduring negativity.

    It would be great if you could get in and be positive and support these things rather than always being so negative.

    Yours

    Ivan Aplin

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